So, you’ve been through the home buying process before. You know the excitement, the paperwork, and the eventual joy of unlocking your front door for the first time. But now, life has evolved, and you’re considering your next home. Whether you’re looking to upsize for a growing family, downsize as an empty nester, relocate for a new opportunity, or simply find a home that better suits your current lifestyle, the journey, while familiar, has new layers of complexity.
At Goodwill Finance, we understand that moving from one owned home to another presents unique financial and logistical considerations. Here’s a quick guide to help you navigate this important transition.
1. Reassessing Your "Why" and "What" – It’s Different This Time
Your needs and priorities have likely shifted since your last home purchase. Take time for honest reflection:
What’s Driving the Move? Is it space (more or less?), location (closer to work, family, or specific amenities?), lifestyle change (less maintenance, more land?), or financial goals? Clearly defining your “why” will guide your entire search.
How Have Your Needs Evolved? What works in your current home, and what absolutely doesn’t? Think about daily routines, future plans (kids leaving for college, aging parents, working from home permanently), and desired lifestyle changes.
Long-Term Vision: Is this your “forever home,” or another stepping stone? This will influence your priorities regarding features, potential for appreciation, and how much renovation you’re willing to undertake.
2. The Financial Equation – Leveraging Your Current Position
This is where things differ most significantly from your first purchase:
Understanding Your Equity: Your current home is likely a significant asset. Get an accurate market valuation to understand your potential equity. This will be crucial for your down payment on the next property and overall budget.
Mortgage Pre-Approval (Still Crucial!): Even as an existing homeowner, getting pre-approved for your next mortgage is vital. Lenders will assess your current financial situation, including existing mortgage (if any), and the potential proceeds from your sale. Goodwill Finance can help you understand your borrowing power in the current market.
The “Net Sheet” Reality: Calculate the net proceeds from your current home sale (after real estate commissions, closing costs, any necessary repairs/staging, and remaining mortgage payoff). Similarly, factor in all costs for the new purchase (down payment, closing costs, moving expenses).
Bridge Loans or Contingencies? Will you need to sell your current home before buying the next? Or can you manage a period of overlap? Discuss options like bridge loans (short-term loans to cover the gap) or making offers contingent on the sale of your current home with your financial advisor.
Capital Gains Tax: Depending on how long you’ve lived in your home and your profit from the sale, you might need to consider capital gains tax. Consult with a tax professional.
3. The Big Question: Sell First or Buy First?
This is often the trickiest part for current homeowners.
Selling First:
Pros: You know exactly how much money you have for your next purchase, making you a strong buyer (no sale contingency). Less financial stress.
Cons: You might need to find temporary housing if you sell before finding your next home, involving a double move.
Buying First (often with a Home Sale Contingency):
Pros: You can move directly into your new home.
Cons: Your offer might be less attractive to sellers. You might carry two mortgages for a period if your current home doesn’t sell quickly. This requires careful financial planning.
Your real estate agent and a mortgage advisor from Goodwill Finance can help you weigh these options based on market conditions and your personal circumstances.
4. Location, Lifestyle, and Long-Term Suitability (Revisited)
You have a better understanding of what you value in a location now.
Beyond the Commute: Consider proximity to healthcare, desired school districts (if applicable), walkability, community atmosphere, access to hobbies, and noise levels.
Future-Proofing: If downsizing, think about accessibility (fewer stairs, wider doorways). If upsizing, consider if the space will adapt as your family’s needs change again.
Maintenance Levels: Are you looking for less yard work, or more space for gardening? Do you want a newer home with potentially fewer immediate repairs, or an older home with character that might require more upkeep?
5. Streamlining the Transition
Declutter and Prepare Your Current Home for Sale: This is essential for maximizing its appeal and sale price. Start early!
Home Inspection on Your New Purchase (Don’t Skip!): Even if you’re an experienced owner, a professional inspection on the property you intend to buy is non-negotiable.
Logistics of the Move: Coordinate movers, utility transfers, and mail forwarding. If selling and buying simultaneously, timing is everything.
Your Next Chapter Awaits – Let Goodwill Finance Help You Plan It
Moving to a new home when you already own one is a significant undertaking, but it’s also an exciting opportunity to align your living situation more closely with your current life. Careful planning and expert financial guidance can make all the difference.
The team at Goodwill Finance specializes in helping homeowners like you navigate the complexities of selling and buying. We can help you understand your equity, explore mortgage options for your next purchase, and strategize the financial aspects of your move.
Ready to explore your options for your next home? Contact Goodwill Finance today. We’re here to provide the clarity and support you need to make your next move a successful one!
