All Forum Posts by: Sam Alpha

This might require a simple strategy, but I'm struggling with putting it together.

We live in our primary home at the moment. 

Appraisal: $470-475k$

Willing to sell: 450k as-is.  (Nothing major wrong, usual wear, floor plan isn't the greatest). 

Amount left on the mortgage: $250k.

Equity: $425k($450k minus fees) - $250k = $175k

At the other end, we would like to build at acost us about $360k over 7 months.  We are hoping to pull the equity from the other sale and transfer it to the new build and have a new mortgage at $185k. With all done, the new property (on the lake) should appraise at around $575-600k.

This is where I need help.  

The numbers above work great on paper.  However, if the market takes a turn, we cannot sell until the other property is built.  Chances are, all the built-up equity, which I plan to transfer would dry up fast and get us in a bind!.

I do have the option at taking a home equity loan at 5%. This does put the equity in my hand and maybe even allow to put the down on the new build. If the market turns and the equity dries up, can I let the bank take the old property or will they hold me liable for the equity loan as well?.  What other implications do a home equity loan have?.

Is there a smarter way of making this transition, whilst protecting the equity?.

Thank you!

Our team is in the process of creating an algorithm that is designed to indicate the best possible time to lock a mortgage rate determined by various factors such as upcoming economic/market data, news related volatility, duration of lock allowance, present US 10 year treasury price action etc.  

i) Is there a credible company out there that provides a list of people that have just been pre-approved for a loan/mortgage.

ii) Would sending out targeted mail, e-mail or social media ads just after pre-approval application has been submitted be the best time.

iii) Is there any other or better way(s) of marketing this service.

Thank you.

@Parker Detweilerthank you for the helping hand.  If we decide to sell, I will be getting in touch with you.  It sure helps getting an opinion from someone that does this day-in, day-out!

@Parker Detweiler to get it under contract in 2 weeks, we may have to be EXTREMELY aggressively priced.  I'm not sure if that would be the best course of action in the long run. 

Refinancing and renting is another option we have at hand.

@Upen Patelthat is one of the options we are looking at.  Alternatively, if we are willing to be aggressive, we will drop the price and move in there.  

How much would refinancing cost on a property worth $250k (all costs included)?

@George Hermann

For Sale sign - ✔

Staging - ✔

Multiple online database - ✔

Paper ads - x

Price - This item is subjective and since I am the agent owner, I wanted to get the bias factor out of the equation.  I got 3 friends (agents) to do me a comp. analysis and it seems that we were priced well.  Over the last 30 days, the prices have dropped about 10% (which is a bit for a very highly sought neighborhood) and if we want to sell, than we may have to aggressively lower the price.  We got a major discount on the other property, so in the scheme of things, we can still afford to price aggressively and call it a day.

I appreciate all the advice that you've posted.  Thank you.

@George Hermannmyself.  I've had a couple of open houses, one brokers open and have reduced the price by $10k so far.  We have been on the market for 60 days.

@Andreas W.that is correct (2 mortgages/2 primary res.)

It's really not about the lender finding out, but doing the right thing.  I like sleeping easy with a clear conscience.

 I already have a mortgage set up for the purchased property (as my primary residence). The plan was to sell my current property and assume the purchased property as my primary residence.

Thanks @Upen Patel 

That could have worked, but my primary residence is only 5 years old and in very good condition.  Renting it out posses the following issues:

i) rent will not cover the mortgage

ii) showing will be an issue with renters residing here

iii) tenant presence may deteriorate the condition of the property

The purchased property came at a 40% discount and needs updating.  It is habitable with no major issues and so seems the better one to put on rent.

How can I rectify this issue and how would one align themselves for the foreseeable future?