From: WelcomeHomeABQ.com
So... you need to move but you can't sell your existing home until after you move. If you can afford and qualify for two house payments, no problem. But what if you can't... here are some options.
•1) Seller Financing - Ask the seller for a short term Real Estate Contract (REC). This is difficult for the seller if the down payment is small. They will need 8-9% of the sale price just to pay their closing costs, so unless your down payment is large enough, they would have to bring their own money to the closing table to sell on a REC. Also, their agent will want financial information on you and a lender letter to ensure their confidence level is high that you will be able to follow through with the purchase and pay off the REC as per the contract terms.
•2) Lease/Purchase. This is where the purchase offer includes, as a part of the offer, a date in the future to close on the home but lease it in the meantime at _x_ dollars monthly/daily. We go through the offer/counter offer process and come to purchase and lease terms all at the same time. Again, the seller is going to want your financial information and a letter from a lender saying you will be able to close on the home as soon as your home sells. The closing date on the purchase part can say contingent upon home located at _____ closing and funding. This might be the most viable option for you someone with a small down payment.
•3) Of course a contingent offer is always an option, but would not allow for moving-in prior to selling current home. The good thing is it provides a comfort level of knowing where you will be. Most accepted contingent offers have about a 60 - 90 day closing offered and the sellers can continue to market the property if they do a "right of first refusal" as a counter offer to your offer. This is where they accept your offer with the contingency, but say if another offer comes in that they want to work with, they would give you 24 (or 48 or 72) hours to either remove your contingency and solidify your deal, or they could work on their other offer and you can lose the home. Many agents are hesitant to show homes with a right of first refusal as they know it can be emotional and difficult.
