Are you dreaming of buying a new home in Texas without the hassle of selling your current home? It's a common scenario, and the good news is that there are a couple different strategies to make it happen. As a customer-focused mortgage company, we understand the challenges and complexities involved in this process. Our team of knowledgeable mortgage loan officers are here to guide you through the intricacies and help you achieve your dream of buying a new home without the stress of selling your current one.
One of the most effective strategies for buying a home in Texas without selling first is to explore bridge loans. A bridge loan is a short-term financing option that allows you to access the equity in your current home to use as a down payment on your new home. This can be an excellent solution if you have found your dream home but haven't been able to sell your existing one. Bridge loans provide the financial flexibility you need to make a competitive offer on your new home without being contingent on the sale of your current one. Although bridge loans are mostly short-term solutions (less than 6-12 months), they can offer some great benefits in negotiating AND qualifying. Often called cross-collateral loans, some bridge loan products provide easier qualifying criteria with regard to debt-to-income ratios. In a competitive market, being able to purchase and give the seller peace of mind that you don't need to sell your current home first in order to purchase their home is often the difference between winning and losing an offer. Bridge loans typically require a good bit of equity in the departure residence, but each situation is different. And then additionally, the house you'll be buying in Texas plays a role in the equation as well. Give us a call, or submit your information here with "Texas Bridge Loan" in the comments section and we'll walk through a worksheet with you to calculate exactly how big of a bridge loan you might qualify for. So what are bridge loan interest rates in Texas? Again - it depends on the entire scenario, but they're usually just a tad higher than regular market rates due to the fact that you're paying for a convenient solution to a problem.
A second option to consider is a home equity line of credit (HELOC) on your current residence. With a HELOC, you can tap into the equity of your current home to finance the down payment on your new home. This can be a flexible and convenient way to bridge the financial gap between buying a new home and selling your current one. The benefit here is you can use the funds to come up with a sizeable down payment on the new property. The downside being that you need to qualify for not only the departure residence mortgage payment, but now also the HELOC payment, AND the new mortgage payment on your home in Texas. This option is perfect for the type of buyer that has plenty of income, but might have most of their cash tied up in their current home. HELOC's are also relatively inexpensive to obtain - so it can be a pretty cost efficient way to tap into some cash and strengthen your offer on the new home that you want to buy. Here at McKinney Home Loans we can not only help you purchase that new Texas home you've fallen in love with, but we'll do the HELOC for you in most instances at the same time to reduce time and effort spent on documentation. Give us a call and we'll help you understand the potential benefits and risks associated with this financing option.
A third option, and one that isn't used often enough in our opinion, is to keep the current home you have and rent it out. The idea here is to use the rental income from a tenant to offset the mortgage payment so that it doesn't impact your debt-to-income ratios when qualifying for the new home in Texas. Not only are you getting the tax advantages of having a new investment property, but depending on the market you're in and the current loan payment and rent you'll be receiving, you very well might be walking into a cash flow positive situation that pays you each month. We are well versed in the different lender requirements for utilizing departure residence income. The rules and guidelines on how rental income is calculated, how much of it is allowed, and whether it even can be allowed are different from Fannie Mae to Freddie Mac to FHA to VA to Jumbo. That's why it is critical you connect with a trusted advisor at McKinney Home Loans first if you're thinking of going this route, so that you can get the expert guidance and advice up front to see if utilizing rental income from a departure residence before buying a new home is the right fit for your situation. Some programs require an appraisal on the departure residence to determine what fair market rent might be. For others they may only require a signed lease and first month's rent and a security deposit. If you're exploring the idea of buying a new home in Texas without selling your current home first, it's important to have a clear understanding of your financial situation and options. Our team of mortgage professionals can help you navigate the nuances of this process and provide personalized guidance tailored to your specific needs. We understand that every situation is unique, and we are committed to helping you find the best solution for your individual circumstances.
When it comes to achieving your goal of buying a new home without selling first, it's essential to work with a team of experienced mortgage professionals who have a deep understanding of how loans work, especially in Texas. Far too often we see buyers pass on an opportunity to purchase the home they really want simply because they received poor or inaccurate advice on how best to handle the current home they're wanting to move out of.
We encourage you to reach out to us to discuss your specific needs. Together we'll explore the seamless strategies available for obtaining financing to purchase a home in Texas before selling an existing property. Our team is ready to provide you with the personalized attention and expert advice you deserve as you embark on this exciting journey. Whether you're just beginning to explore your options or you're ready to take the next steps, we are here to support you every step of the way. Get in touch with us today and let's work together to make your dream of buying a new home in Texas a reality.
