[Unatheowl]

Dh and I want to build but that is in 5-10 years. We thought we would stay where we are until then unless something comes up which would be a suitable interim house, so we're kind of looking out all the time and seeing whats out there.

Yesterday I saw something suitable. Obviously our house , although it has been valued, it not on the market. What would our options be to secure this new place when our own place which may or may not sell for a while, especially as it is coming up to Christmas. Surely we aren't the only people who happen upon this situation? What do other people do ?

[SarahM72]

Maybe ask whoever is doing your side of the conveyancing about putting a clause in the contract that makes the purchase of the house subject to the sale of your house. As far as I know a time limit is normally put on it, say for example that if your house doesn't sell within three months then the contract to buy that particular house is void/cancelled.

I'm in Qld, and this seems to be a fairly common sort of thing to have inserted in a contract when one is purchasing a house.

[Unatheowl]

ahh, ok thanks for that. Ive never been in a situation where i'm selling one house to buy another. I can imagine there would be so many timing issues bu I just have no experience with it. Its probably the normal situation thought right? Is there some kind of finance that the bank can offer in the meantime and what would it involve?

[SarahM72]

A bridging loan perhaps? But if you were purchasing the home subject to the sale of your house, you would only need to put a small deposit (I've seen deposits as smallas $50, or even none at all). There would be no need for a bridging loan, as you haven't actually purchased the other home, and won't be until and unless you sell your house. Hope this makes sense.

You would only need a bridging loan if you purchased the other house without it being subject to the sale of your house (unless there was a large gap in the settlement time on your house and the other house I would suppose).

However I'm not a conveyancer or anything, this is only what I know from personal experience. I know it can be done however, but obviously you need to talk to a legal professional of somesort. Although I guess the estate agent could give you some preliminary information about sale contracts, so you have something more to think about how you want to go about this.

[SplashingRainbow...]

Una you can ask your bank about bridging finance.

Happens quite a bit.... I think you're self employed? They will almost certainly want financials (bank that is) make sure you get a copy from your accountant before they close for Christmas.

[Unatheowl]

wow, such a small deposit? That would be ideal. Yes, I do need to do more research so I thought EB would be a great place to start lol

Yes, we are self employed (both of us ) but have been for about 6 years now.

[Shadowess]

You need to speak to your solicitor and your mortgage broker/bank, to see what can be done.

[SplashingRainbow...]

Another option is to buy now with delayed settlement - say 3 to 6 months. In that time you can rent it from them if you want to move in an advertise your existing place.

[SarahM72]

wow, such a small deposit? That would be ideal. Yes, I do need to do more research so I thought EB would be a great place to start lol

Yes, we are self employed (both of us ) but have been for about 6 years now.

I'm in Qld, so you better check out the deposit requirements where you are. But here in Qld the deposit can be negotiated, and can be very little, as long as both seller and buyer agree (at least it was when I last bought a house). However some sellers are reluctant to accept a small deposit (incase the buyer pulls out I guess??)

And yes, as per PP, delayed settlement would be another option, but if your house didn't sell within the settlement period you'd have to be aware that you would then have two houses and possibly two mortagages to support until you sold your other house. Generally speaking, I would suppose (and I'm in no way an expert at all!!! - just another house buyer like you) this is where a bridging loan would come into play??

[AllegraM]

Unless you can afford to buy the new place and keep your current place as a rental, you have two options.

1. Buy but make contract subject to selling your house within a specified period.

Advantage is that you can transfer your mortgage smoothly, as long as both properties settle on the same day. Disadvantage is that you will have to move out of your house and move into the new house on e same day. Nightmare! Major disadvantage is that the sellers of the house you are buying may not agree to enter a contract on that basis. Sellers hate prior sale clauses as it gives them no certainty for what is often a long contract that has the potential to fall over if you can't sell your current place.

2. Bridging finance

Advantage is that you can quickly proceed to buy the new place without waiting to sell your current place. You can move from one property to another at your leisure. Disadvantage is that yiu will be essentially paying for two mortgages until you sell. Bridging finance is expensive and should be a short-term option only. Major disadvantage is that you would be in a big pickle if you could not sell your current place easily, or could not sell it for the price you need.