Keys to Avoid Getting Burned When Selling Your Stafford Home
Selling your Stafford home can be risky. While it usually doesn’t seem like it’s going to be too fraught with danger, underlying the simple thought of selling your Stafford home lurk a number of traps that can have significant financial ramifications if you’re not careful. Because moving and selling your Stafford home can be incredibly expensive, it’s important to take proper precautions so you don’t end up regretting your decision.
There’s no way to remove all of the risk unfortunately, and part of life is taking risks. However, calculated risks are far more likely to payoff than diving headlong into a situation without proper preparation.
To help sellers avoid getting burned when selling your Stafford home, avoid the following mistakes.
Selling Before You Close on a New Home
A common risk many Stafford home owners take when selling their home is selling before they have closed on a new home. While the average homeowner needs the funds from the sale of their existing home to buy the new one, and it’s commonly done, it can be a costly error if it goes wrong.
For this reason, some real estate pros will advise that sellers make sure that your closing is essentially done on the new home before you sell your existing home. If a seller makes the mistake of not lining up their next home, it could create a situation where the they have nowhere to go.
Situations like this can wreak havoc on Stafford sellers. Scrambling to find a place to live in the meantime is not pleasant. Especially for those with larger families, moving in with relatives or friends for the short term is not always an option.
What Options Do You Have?
If closing on a new home immediately is not an option, make sure you get as far in the new home purchase process as possible by getting pre-approved for a new mortgage. What you ideally want to have is a commitment from a bank to lend you money for the new home, pending a closing statement from the first home, which would enable you to sell your home on day one and close on your new home on day two with bank funding.
Another trick smart home Stafford sellers typically take advantage of is purposely moving into an apartment when selling their home. This strategy affords you time to both close the sale, and research and find the right second home. While this strategy can sometimes backfire, it still has elements of safety because you can always move back into the home assuming you haven’t sold it.
Avoid Using Retirement Money
You will want to think twice about using your retirement money as a down payment for a home purchase. While it may seem like a good idea at the time, it can backfire in costly ways if it doesn’t work out.
Liquidating your 401K or other similar retirement accounts before your first sale closes may seem like a safe gamble. But if you hit any hiccups, the penalties you can pay for withdrawing your retirement funds could wipe out any profit you might have seen on the sale of your first home.
While we’ve listed several common traps people fall into when selling their Stafford home, it’s important to remain ever vigilant when conducting what is typically the largest financial transaction most people will ever conduct in their lives. In addition to the mistakes listed above, it’s recommended to seek out the advice of people who have done this several times before. The more you know when selling your Stafford home, the better off you will be.