Did you know that it’s possible again to get a bridge loan? A bridge loan is a short-term loan that can be used to access the equity in a home you are planning to sell in order to purchase a new home.
Following the financial crisis in 2008, lending standards got extremely strict, and bridge loans vanished from the market. Non-cash buyers who wanted to buy a new home before selling their old one needed to either (1) show that they had enough income to make payments on the loans on their existing home and on their new home indefinitely, or (2) they needed to show a signed lease for their old home, covering enough of the carrying costs for that property. Now some lenders will review the loan application taking into account that the borrower is only planning to own both homes for a short period of time.
Not every lender offers this type of loan, and they don’t make sense for everyone, but I do know of a couple very good local loan people who can offer a bridge loan. (I’m happy to send you their contact information if you’re interested.) There are still, of course, qualification requirements including a good amount of equity in your old home, but you no longer need enough income to pay your new and old mortgages indefinitely, and you no longer need to show that you have leased your old home.