we are looking at buying a house and the one that most closely matches our criteria is a foreclosure. the previous owners just couldn't afford it. they didn't trash it and it's in great shape. we've been to see it twice, took my parents once (dad is an architect), and everything is great. the bank says we can afford it. yay let's make an offer...

i called my realtor and she tells me sometimes with bank-owned property they won't accept an offer that's contingent on us selling the house we're in. this is the only way we could afford to buy a new house, so we are just trying to sell ours first and hoping that the other doesn't sell beforehand.

has anyone been in this situation? tried a bridge/swing loan? i don't really know what to do and if there are other options. i'm waiting to hear back from the realtor and our bank to see what we can do, but if anyone has any personal experience i'd really appreciate the advice. i didn't find anything on here by searching but please link if it's out there.

11/23/2009 10:14:39 AM

bridge loan is probably your best option. I was in this situation as well about a year and a half ago. I asked my mortgage broker about a bridge loan, but he ended up approving us for a 95% fixed loan instead, and then when we sold the old house, I could throw the money back into the new house, and they'd re-amortize.

but yeah, if we hadn't done that, the bridge loan would have been the next best way to go.

11/23/2009 10:44:47 AM

we're approved actually for a 97% loan. i really don't understand all this crap very well so i don't know how your 95% loan avoided the need for a bridge loan. please explain

11/23/2009 10:49:58 AM

if you approved for a loan for 97% of the offering amount of the home you want ... and you have the remaining 3% + closing costs in the bank somewhere, then you dont technically need another loan (or the equity from your current home) to buy the property ... so why are you offering a contingency offer?

Just make an offer with no contingencies.

11/23/2009 12:39:00 PM

^^

sorry, i guess every situation was unique. I didn't have a problem making two mortgage payments (well, i didn't WANT to do it, but i had enough in savings to swing it for a while if needed), but I couldn't put 20% down, AND make two mortgage payments, so I would have needed a bridge loan if they couldn't approve me for a 95%+ loan. The builder I bought from also would not do a contingency offer, and we had to move fast.

this was right when the bottom fell out of the mortgage industry and they went from giving a loan to anyone with a pulse to being overly strict.

11/23/2009 1:36:55 PM

^^we can't just make an offer b/c we have to sell the house we're in. we can't afford 2 mortgages, hence why we looked at a bridge loan. we can easily afford the new house if we aren't paying for the current one.

we met with our bank today. i finally understand how a bridge loan works, which is way not how i thought it was at first, but we don't have enough equity to do that anyway. i wasn't really surprised

11/23/2009 7:56:10 PM

better drop the price on your house and get it sold

The bank is only going to look out for the bank, they do not have anything to gain by letting you put a non-binding contract on the house they need to get rid of.

11/23/2009 9:37:30 PM

^agreed, drop the price of your old house until it's sold.

11/24/2009 1:07:43 AM

it's not on the market yet, but soon, which is also why we looked into the bridge loan.

well, like i said, the bridge loan is not for us. i was relieved to walk out of there with a definite answer instead of having to make a tough decision. they were really helpful and explained it in terms that we could easily understand, which apparently the internet cannot do. we're looking around some more. i found another house that's awesome but has no garage/workshop. we could build that later but i dunno how much later that would be. we'll probably just wait around until we find the right thing. the reason we were trying to move so fast before was b/c that other house was such an insane deal that we probably won't find anything as big with so much storage plus a garage and whatnot again.

hopefully that means it wasn't meant to be and we'll find something more awesome later. i do want to get it sold before the end of the tax credit stuff. we don't qualify, but someone buying our house might.

11/24/2009 9:24:11 AM