Forgotten Your Password?

Need to Register?

Question Icon

Can I take out a loan on a home I am currently selling?

my home is completely paid off and we are looking to move out of state. Can I take a loan on my current home to assist in a down payment for my new home? by barbarag169 from Camp Pendleton, Colorado. 22 days ago Reply


Nick Bebout (NickBebout)
#102 ranked lender in Colorado - 29 contributions

Yes, you can take out a "bridge loan". From what you described, a bridge loan is used for that exact purpose. It's a temporary loan that will allow you access to some of the equity in your current home to put down on a new home. Unless you will be keeping your current home, then you could take cash out on a new fixed rate mortgage, or a home equity line of credit.Nick Bebout - American Liberty Mortgage, Denver, CO - 303-458-3778

22 days ago
1
0
Mike Shaw (MikeShaw)
#4 ranked lender in Colorado - 9 contributions

Bridge loans can be expensive but your only option if you are already selling. However, if you have other assets for a smaller down payment you can purchase the new home and then put the rest of the money down after it sells. This is a loan scenario called Delayed Financing that may work for you as well.

22 days ago
1
0
William J Acres (William_Acres)
#1 ranked lender in Arizona - 8,294 contributions

Yes.. so long as you disclose the loan when you go to purchase your new home.. it's not a problem.. but getting a loan on a home that is currently listed for sale will be difficult.. most conforming loan guidelines will require that you remove the property from being offered for sale before applying.. The other issue is that you really want to be sure the lender knows you plan on paying off the loan as soon as the property sells.. this is because there's a lot of work involved in getting a loan put together.. the lender only "Profits" when you make payments.. if you don't make at least 6 payments, then it's possible the lender will actually lose money by doing your loan. Also,, depending on the loan size, it might be difficult to find as well. Are you looking for a $30K loan? or are you looking for $130K loan.. the smaller loan's are a little more difficult to find since most lenders have minimum loan amounts they can do.. some are $50K, some are $75K or higher.. but not many go below $50K.. As Nick suggested,, a bridge loan is probably your best bet.. this is a hard money type loan.. it's fast, but it's expensive. expect to pay a very high rate and much higher costs... I'm a preferred Lender with California and Arizona being my primary markets. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com NMLS# 226347 / LendUS, NMLS 1938/ AZMB0121893

21 days ago
1
0
Subscribe to our news feed.