It’s a scenario we are all too familiar with: That 2-bedroom apartment looked huge when you bought it as newly-weds. But now that your second baby has arrived, it seems to burst out of its seams. You’d love to move. But how can you? Your equity is tied up in the condo, and qualifying for an entire second mortgage on the new home is out of the question.
What to do? Sell first, put the proceeds in the bank and move the family to a temporary rental? It’s a conservative solution but not necessarily a cheap one, and it would entail moving twice, possibly renting storage and could mean missing out on good offerings and low interest rates.
Alternatively, you might consider making an offer on your new house contingent on the sale of the current one — an option that is less likely to fly if you are buying in a more competitive market. It also often means you are forced to move the old home quickly, have less time for preparation and will likely sell for less money.
The third option is a bridge loan. But it’s often a scary one. While certain lenders might offer bridge loans to you based on your income and the equity in your home, this option makes many sellers uncomfortable. Just how long can they afford to pay two mortgages? And what if the house doesn’t sell right away? Where will the extra money come from that might be needed to move and make market-ready improvements?
That’s where our rather amazing new Compass bridge loan program — rolled out today — comes in. Combined with the interest-free Concierge loans (which can pay for cosmetic home improvements and sometimes even temporary living arrangements for the sellers) the bridge loan program potentially fronts you 6-months-worth of mortgage payments on the new residence, providing quite a bit of (previously unavailable) flexibility and control. Assuming you sell within those 6-months, you won’t have to pay any of this back until your current condo or house settles.
We don’t want to brag here, but it’s just one more way we can make your transition easier (or possible in the first place!) Find more info here, or just call us or fill out the form below to get started!