Real Estate Blog

Countless people have told me over the past year that they are thinking of moving and are excited by how much they could make if they sold their home now.   A housing market like the current one is great for sellers, after all, selling your home quickly and for top dollar seems like a win to me!  However, before jumping into the market to sell, keep in mind that you will also be a buyer at some point in this transaction and need to have a plan for what comes next. 

Buying a home right now is not impossible, but it is extremely competitive (hint: the main reason why your home would sell so quickly and bring top dollar!) and requires some patience and preparation.  The first thing to consider before starting a home search is how you will pay for a new home.  Do you need to sell your current home in order to finance the new one?  Currently, many sellers are flooded with cash offers or offers with no contingencies and will often decline offers with sales contingencies.  However, that doesn’t mean you don’t have a chance if your offer is strong and you can show your home is on the market or better yet, under contract.  If you really want to move, don’t delay!  Start now by putting your home and finances in order.  Work through what type of loan you will need and get pre-approval.  At the same time, prepare your home and get it on the market.  It will be frustrating for you to look at homes for sale and make offers without having the ability to move quickly when negotiating a contract.

Once you have your finances in order and your home listed, you need a plan if or when your home sells before you purchase a new one.  What if you have a closing date on the contract to buy a new property but that closing date doesn’t match your selling contract date?  Often times we can negotiate dates to match, however, with so many out-of-town buyers moving into Tennessee, they often can’t or don’t want to delay closing.  Consider your circumstances regarding moving and temporary housing.  Is the time difference between closings a few days, a few weeks, or months away?  Are you able to handle the time, effort, and expense of moving twice?  One of the easiest solutions could be to negotiate staying in your current home after it closes and paying the new homeowners rent until you close on your new property if they don’t need to move in immediately.  However, if the buyer needs to take possession on closing day, you will need to have another plan and it should be fool-proof as delays in vacating your old property may cause undue tension for everyone involved!  Plan to budget for the cost of a short-term rental as well as storage for your household goods if this occurs. Some homeowners in this situation are able to save some money by arranging to stay with family or friends until they close.  You can also explore the option of extended stay hotels or fully furnished short term rentals which could help eliminate the need to have access to household goods such as sheets, towels, and kitchen items. 

Also remember if there is a gap between the sale of your old home and the purchase of your new home you transition from being a homeowner to a renter and need to check with your insurance company on steps to take to ensure you have adequate coverage for your personal items no matter where they will be stored. 

Many people continue to sell and buy properties in this current market successfully, they just need to be patient, flexible and have contingency plans in place.  If you really want to sell and move, now could be the perfect time to do so as long as you are prepared.  Call me if I can assist with any of the steps in this process!

Always remember....."You've Got A Friend in Real Estate"

Jarod Tanksley 615.403.8265

www.BrentwoodandBeyond.com

Brentview Realty 615.373.2814

Why Go with a Jumbo?

The prices of homes in middle Tennessee jumped 40% from 2021 to 2022.   With this drastic rise in home prices, borrowers are having to look at loan options that are outside of the realm of a Conventional fixed rate loan. The Federal National Mortgage Association (also known as Fannie Mae) raised their conforming limit this year to $647,200, up from $548,250 in 2021, but in this market sometimes it just isn’t enough.  According to Investopedia, the definition of a conforming loan limit is “the dollar cap on the size of a mortgage that Fannie Mae or the Federal Home Loan Mortgage Corporation (also known as Freddie Mac) will purchase or guarantee.”  Mortgages that meet the criteria for backing by these two agencies are known as conforming loans and the limit is recalculated each year based on county. Most counties in the United States are assigned the baseline rate.  Based on the mandate of the Housing and Economic Recovery Act (HERA) of 2008, the conforming loan limit is adjusted every year to reflect changes in the average price of a home in the United States and is reset in November for the following year. 

Most people have heard of doing a first and second mortgage in situations where there is a need to borrow a higher loan amount than Fannie Mae’s conforming limit.  This works in most cases, but the borrower then ends up with two mortgage payments instead of one and if they ever want to refinance the home, they will have to do a cash out refinance to combine the two loans.  This is one instance where a jumbo loan could help. 

If you plan to purchase a home that costs $500,000 or higher, a jumbo mortgage may be a good option for you to consider. Keep in mind however, that in order to qualify for a jumbo loan, you will need to meet more strict credit requirements than if you were applying for a conventional loan because jumbo loans carry more credit risk for the lender. You will need to have a very strong credit score with low debt and be able to show adequate assets to cover the increased mortgage payment. The increased risk comes from the higher amounts of money borrowed and the fact that these loans are not guaranteed by Fannie Mae or Freddie Mac.

There are multiple loan options available to a home buyer that are specific to individual financial circumstances.  Contact me today to find out how we can help you get into that dream home! Brittney Campbell/Citizens Bank 615.491.4744 NML#184975   Always remember... "You've Got A Friend in Real Estate"

Jarod Tanksley 615.403.8265

www.BrentwoodandBeyond.com

Brentview Realty 615.373.2814