How to Buy and Sell a House at the Same Time?
6 minute read
April 4, 2023


After you purchase your first home, there are some circumstances when you may find yourself buying and selling houses at the same time.

It sounds like it may be complicated, but we’re here to show you how you can buy and sell a house simultaneously.

We’ll review the differing outcomes of buying first and selling first, which is the better option, and the tools you may need to do this successfully.

If you decide to buy first…

When deciding whether you should buy and sell a house at the same time, it’s important to review all factors and how they align with your financial goals and timeline.

If you decide to buy a new home before you sell your existing home, there are different advantages and disadvantages to be aware of. 

Advantages of buying first

One of the most significant advantages is that you’ll have a home to move into once you sell your current home. This option could help you save on storage and hotel costs.

Buying before you sell gives you peace of mind as you won’t have to scramble to move into your home. 

Another advantage is the timeline begins with you so that you can set the pace. You won’t have to rush into buying a home you wouldn’t be happy with. 

Something else to consider is that you’ll be able to move whatever you need into your new home. 

This gives you time to move and makes it easier when setting up your home for showings. 

Disadvantages of buying first

The biggest disadvantage is taking on a mortgage in addition to your existing mortgage payment. Even for a short period of time, making two mortgage payments each month can be costly.

On top of that, if you buy a home while having a current mortgage, potential lenders may see you as a risk and may offer less-than-ideal rates and terms. 

This is partly because lenders look at your debt-to-income ratio. If you have a higher DTI because of your existing mortgage, lenders will factor that into your mortgage rates.

Other factors to consider are the down payment and closing costs on your new home purchase.

A down payment can quickly add up to the thousands. For example, a 10% downpayment could easily amount to $100,000.

You’ll also have to pay closing costs and you’ll need to have that money saved already for when you purchase your new home. 

Many homeowners don’t necessarily have those funds before they sell their biggest assets. This is why some lenders offer what’s called a bridge loan to “bridge” the gap before you sell your existing home and buy a new one. 

Check your mortgage options

If you decide to sell first…

For a few reasons, selling a house first is the preferred path for homeowners. Some of those reasons are the flip side of what we’ve just discussed.

Advantages of selling your home first

The biggest advantage of selling your home first is that you’ll have the money from the sale to purchase your new home and secure a mortgage.

It’s a double-win because lenders will see you as less of a risk and offer you rates and terms more fitting to your financial scenario; plus, you’ll be able to cover the upfront expenses, like a downpayment and the closing costs.

Another factor to consider is that you won’t be pressed to settle for an offer just sell the home sooner. 

You can list your home and wait for the proposition that makes the most sense for you.

Disadvantages of selling your home first

Before deciding whether to sell or buy a house, make sure to arrange temporary housing once the house sells.

Unless you already have your next home picked out, finding your home and getting approved for the mortgage could take some time and be expensive.

You’ll need to make living arrangements and secure a place to store all your home goods and furniture.

In this situation, you may be pressured to find a home and you don’t want to settle on somewhere that wouldn’t be your first choice.

Selling your home first comes with significant advantages, but it would be beneficial to plan ahead so you can make the process as seamless as possible.

Is it better to sell your house before buying a new one?

It’s possible to buy a new home and sell your old house at the same time. The right path depends on your financial situation and timeline.

If you have everything lined up for post-sale, then selling your house before buying another may be a better route. 

You’ll have the money from the sale to move forward with your purchase, and your financial situation will be more appealing to lenders.

On the other hand, if you have a great financial situation and have been pre-approved for a mortgage with rates and terms you can meet, then buying a house first may be better for you.

Check out the local housing market and see if it’s a seller’s or buyer’s market

If it’s a seller’s market, there are more buyers than homes available. It might take you longer to find your next home, but you may be able to sell your home faster and perhaps for higher than what you’re asking.

If it’s a buyer’s market, there are more homes available than potential buyers, so you may be able to purchase a home for a better price. 

Tips for buying and selling houses at the same time

Whether you buy or sell your house first, getting preapproved for a mortgage is beneficial. 

You’ll need to provide your financial information to a loan officer so they can review your scenario and provide you with a pre-approval letter. 

While it’s not a guarantee, the preapproval states how much the lender is willing to lend you based on your financials. 

Having a preapproval in hand can expedite the process in two ways. It assures potential sellers that you’ve already been approved for a set amount and it speeds up the process of applying for a mortgage. 

It would also be beneficial to review your financial situation and see how you’d fair with a new mortgage and what type of mortgage you’d be eligible for in either scenario. 

You can do this with a mortgage calculator; these calculators help estimate what you can expect on a new mortgage, and you can adjust the terms and rates to get a clearer picture.

Whether buying first or selling first, contact a trusted mortgage lender

When you’re ready to buy your new house, GO Mortgage can help you navigate tough situations such as a competitive market or getting a new mortgage before selling your existing house.

We can review your scenario and walk you through your best course of action.

Speak with our experienced team of loan officers and get started today.

Photo by cottonbro studio

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