How to Buy a New Home with an Existing Mortgage in Edmonton
Although usually, homeowners sell their present home before buying a new one, sometimes things go unplanned. Perhaps you came across your new dream home before listing the present one. Or maybe you have got a new job that needs you to relocate as fast as possible. Regardless of the reason, you can purchase a new home before listing the existing one. Let me give a few ideas on how to buy a new home with an existing mortgage in Edmonton!
Port Your Mortgage
Based on the terms and conditions mentioned in the mortgage contract, you may port your mortgage. In this case, the lender may allow porting the mortgage rate and agreement from your existing home to the new one. Mortgage porting is exclusively available for homeowners who are selling and buying simultaneously. It makes sense if you enjoy a low-interest rate and remain with your current term. Transferring your mortgage may help you avoid penalty charges related to early agreement breaking.
Rent Out Your House
You can also keep your existing home and earn some money from it. Rent it out for some profit. It will help you shift to your new home immediately while having somebody else pay the existing mortgage for you. It’s an amazing solution for people who could not sell their houses as fast as expected.
Opt for Home Equity Line of Credit Loans
HELOC or Home Equity Line of Credit is an accomplishing line of credit secured against your current house. It helps you put the old home equity to work as a loan, along with a set of EMIs and interest rates. Although homeowners choose these loans for numerous reasons like kids’ schooling, setting up a new business, or home renovations, you can also use them to secure your new home’s down payment. After selling the old home, you can repay the loan instantly with the finances you got from the sale.
Borrow a Bridge Loan
Bridge loan financing is about reducing the gap between selling existing homes and buying new ones. The same as HELOC, a bridge loan helps you borrow against the old home equity to finance the down payment on your new home. However, since this loan provides quicker approval and helps lay your hands on funds, it may offer shorter terms and ask for higher interest rates. So, it’s a suitable choice if you need temporary funding immediately. However, you need to repay the loan faster.
The above points state how to buy a new home with an existing mortgage in Edmonton. Feel free to weigh your choices, as there are numerous ways to buy a new house before selling the current one. Contact Chris Hedstrom, consult about your preferred lending options or what choices may suit you, and look forward to your new dream home in Edmonton. You can contact me in no time to get details about Edmonton’s real estate market, finances, and more. Stay in touch now and see how I can help you!