I feel like this is a silly question, but here goes.
We currently own a residence with mortgage. We want to move to another place, and wonder about down payments. We do not have much free cash for a down payment down now, but the sale of our house will give us more than 20% downpayment (even with worse case scenario) for the property we are looking at.
Is this normally how it works when one sells their property and buys another O/O property, with contract being contingent upon selling of the first residence? Is that money brought to closing considered the downpayment, or would we need the funds up front with the offer? Or, I guess all that could be negotiable
I’ve done this before by having 1k with the offer then about 4-5k with the P&S and then the rest at closing. Just depends how much you have in cash with you to put down with the P&S. Then you just have the rest at closing. Make sure the attorneys keep in touch so that the money is in the right form at the double closings.
On the 1003 or loan application, there is a box that the loan officer checks on a purcahse transaction and is offered a drop down box that allows the loan officer to choose the source of the downpayment.
One of the options is “Equity from Pending Sale”.
That is, if the lender is sourcing the downpayment.
The only silly question here is the one that was never asked.