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Old 03-01-2017, 11:15 AM   #3
Jimmy Stang
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Quote:
Originally Posted by Mortgage Made Easy View Post
Hi Jimmy -

Great questions and I am sure Realtor 1 will comment on the market, etc.

But for the financing part, just wanted to add some comments. Bridge financing comes into play when you have sold your existing home and want to "bridge" the equity (cash) from the sold home as down payment on the new home.

It sounds from above that you are going to carry both properties and decide what to do with the current home. The question is your down payment for the purchase... you are either refinancing your existing to get some equity out for down payment or you currently have some available funds for the down payment for the purchase?

Just wanted to be sure you understood that "Bridge Financing" is for when your current home is in a firm binding contract (sold) and you are taking possession of your new home before your existing is closed (where the buyers have taken possession).

Best wishes in your new home search. Feel free to PM if you have more questions... I know you are working with someone but am available for 2nd opinion or questions.
Thanks for the reply. I knew that this was kind of a half real estate, half mortgage type of thing, so I'm glad that you also saw it.

Perhaps I've got my terminology mixed up. When I spoke with the mortgage guy on the phone he called it this (I'm pretty sure), but maybe only because I was.

Basically what we'd like to do is use our equity in our existing home (approx 2/3 paid off) to qualify for a "new" mortgage to cover both homes temporarily. And then when we sell the old home, we can dump as much as permitted onto that mortgage to get it back down to normal. Of course, there are limits as to how much you can put as a lump sum, in additional to doubling up payments.

I was told that, given our incomes and debt level, we'd qualify for that bigger mortgage. There was no talk about having to sell first (in fact, that was the exact thing that I told him we did not want to do), so perhaps I was mistaken to call it "bridging". Now that I type this out, it sounds more like we're just getting a much larger mortgage by leveraging our equity.

So from a mortgage person's point of view, is this asinine? A real turnoff is selling while living in the home, and then scrambling to find a place before we need to move out of the old place. I know that possession dates are flexible and negotiable, but it still seems like too much uncertainty for my liking.

To bring it back to real estate a little bit, we are also really picky as to what we'd like, and to the area that we are interested in. So the criteria that must be met is quite specific, otherwise we'll just stay put.

Which brings me back to "buy first, sell second". I'd rather not live in a constant state of "ready to sell" for when my wife finds that perfect place for sale. I'd like to pounce, move, and then sort the old one out afterwards. I know that's ass backwards compared to how most people do it!
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