Helpful Tips, Random Thoughts, Real Estate

Trading Up Homes? Consider Listing Your Existing Home First

September 23, 2010 by · 4 Comments 

Valparaiso Indiana Home For Sale by Steve Cardwell

Valparaiso Indiana Home For Sale by Steve Cardwell

Households in Porter County Indiana are starting to understand that it is a great time to buy property.

Some are looking at all those foreclosures on the market and dream of getting a deal for pennies on the dollar. Others, more realistically, are looking at the current market conditions and see a great opportunity to trade up to a larger home, or a nicer location, than the one they live in now.

You’ve found your dream home in Porter County Indiana and at a terrific price. What’s next?

You must be prepared to answer three tough questions on your quest for your dream home.

1) Are you ready to endure the long road ahead for your dream home?

Did you know it takes around 6 months, on average, to sell a home in Portage Indiana? The numbers in Chesterton Indiana are similar. In Valparaiso Indiana it can take up to 9 months, depending on price range and the area. So from the first day you list, to the day of closing, it may be easily 6 (+) months to get you moved.

2) Can you afford two mortgage payments?

Most people need the equity from House A in order to put down payment on House B. And unless you have lots of cash and above average income, you probably cannot afford mortgage payments from two homes at once. Consequently, if you are like most people you really need to sell first, then buy second.

3) How long will the seller of your dream home wait around while you put your house in order?

One technique Realtor’s use to extend deadlines is the Contingent on Sale rider. In other words, the contract to purchase the new home is conditional on selling the old one. Sounds great, but it puts everybody in a bind. You have agreed to buy a house but you can’t afford to finalize the process until you sell yours first. That’s a bind. You are asking the home seller to take their home off-the-market, then wait around while you sell. That seller is now in a bind too. Is it fair to the seller to have to wait several months due to your procrastination?

If the home seller is like most, they will only let you slide for 30 – 60 days. After that, the home sell will want the chance to sell to a different, more serious home buyer; serious, meaning someone else who is more prepared to CLOSE THE DEAL than you. Now, if you are committed to moving forward, you are forced to accomplish in one month, what it normally takes 6-9 months to complete, which means, forcing you to offer your home at a deep discount price simply to meet the deadline. That is a money losing bind.

What’s the bottom line to trading up homes when you have found your dream home?

Although it is possible to find your dream house first, then sell your existing home, the law of probability says otherwise. On the other hand with proper planning you will be rewarded with less stress, and significant cost saving, by offering your existing home for sale prior to searching for your dream home.

If you’re ready to trade up to your dream home in Porter County Indiana, let’s get your home listed today!

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Steve Cardwell

Steve Cardwell is an Indiana Realtor working with residential buyers and sellers throughout Northwest Indiana. He likes to stay current on the housing market by analyzing real estate trends with a focus on the towns of Highland and Munster Indiana. His broker affiliation is Red Key Realty Leaders in St John, Indiana. Learn more about Steve and visit

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4 Responses to “Trading Up Homes? Consider Listing Your Existing Home First”
  1. For those homeowners who can afford to carry two home mortgages, just remember that Fannie Mae has the ultimate say.

    Fannie Mae requires 6 months of complete home payment (PITIMI) in reserves for the existing home. Furthermore, they also require you to qualify with both existing and future home payments in their evaluation of your debt to income ratio.

    As you stated Steve, if you’re ready to trade up nows the time. Contact Steve to get your home listed and contact me to get preapproved on your dream home.

  2. Those kind of reserves sounds like it will skew many people into the “unqualified” category even if they COULD afford the payments. And wont that rejection adversely impact their ability to qualify later, after being turned down once?

  3. Steve – if not prepared with liquid assets to satisfy the reserve requirements, a resounding loan denial is ahead. The denial will not necessarily impact the future home loan so long as the reason for the denial has been remedied.

    At the end of the day, it’s about being prepared and working with the right professionals to get proper guidance towards a successful home transaction.


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