samantha25
Pearl Clutcher
Posts: 2,912
Jun 27, 2014 19:06:19 GMT
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Post by samantha25 on Feb 27, 2020 4:22:41 GMT
Well, this is maybe me just venting and asking advice... It looks like my disdain for my DH's gym equipment (other vent thread) is minor to what our options are. We are trying to buy a house in Cherry Creek School District at either Campus or West Middle School area and sell our house, too. The current houses available are slim in our price range (550-650K). I contacted a realtor and mortgage broker. Realtor said that it would be best to have a non- contingency purchase (cash offer, not dependent on our house being sold). The mortgage broker said that we would not qualify for new loan as non-contingent, debt to income ratio too high, unless we sold our house..... We have 250-300K equity in our current house, but they won't give a new loan, unless we come up with 20% down payment cash, about $115-200K) I thought we could use a HELOC for down payment to offset any timing between buying and selling. Our credit union is offering a HELOC rate of 2.5%, interest only payment up to 80% equity, so $200K for down payment on new home, but can't qualify with 3 loans (current, HELOC, and new home)... but our house will sell. The market in Denver is crazy..
I'm thinking we could get house ready to sell and then rent something in district to get the kids in good school. We would have to downsize our stuff (rent a storage facility) and then probably DH's gym equipment would go away (good thing, IMO) and then move when something comes up. It's all a gamble with the market here, but not sure what other options we have. Any suggestions welcome.
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Post by mom on Feb 27, 2020 4:27:46 GMT
There is no chance I would have 2 mortgage payments + a HELOC payment. I would sell my home and rent until I found a new home. Is it going to take some extra moving? Yeah. But not having three loans would be worth it for me.
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Post by lisacharlotte on Feb 27, 2020 4:35:20 GMT
I agree with mom . Also, if your debt to income ratio is a problem for a loan, I don't think you can afford to float two mortgages and a HELOC.
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mimima
Drama Llama
Stay Gold, Ponyboy
Posts: 5,020
Jun 25, 2014 19:25:50 GMT
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Post by mimima on Feb 27, 2020 4:39:01 GMT
I'm a Realtor (not in Colorado) and completely agree. As unfun as moving twice is, it sounds like the best option.
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samantha25
Pearl Clutcher
Posts: 2,912
Jun 27, 2014 19:06:19 GMT
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Post by samantha25 on Feb 27, 2020 4:55:22 GMT
There is no chance I would have 2 mortgage payments + a HELOC payment. I would sell my home and rent until I found a new home. Is it going to take some extra moving? Yeah. But not having three loans would be worth it for me. I agree... but it's just the timing... I am pretty sure that our current house will sell within 30 days (home built in 2000). That's what I don't understand. It's what the brokers have to put on paper to finance the new loan. The comps in my subdivision are in the range have sold from $440-550 recently. I'm being realistic that we offer 400K to sell and we will still have equity (at least $275). We sell the home and then the first and HELOC will go away. And the HELOC is interest only, payment about $100/month. It's all about the gamble... my gamble is that I know that our current house will sell quickly within the range of 400K up.....
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Post by mom on Feb 27, 2020 5:19:47 GMT
There is no chance I would have 2 mortgage payments + a HELOC payment. I would sell my home and rent until I found a new home. Is it going to take some extra moving? Yeah. But not having three loans would be worth it for me. I agree... but it's just the timing... I am pretty sure that our current house will sell within 30 days (home built in 2000). That's what I don't understand. It's what the brokers have to put on paper to finance the new loan. The comps in my subdivision are in the range have sold from $440-550 recently. I'm being realistic that we offer 400K to sell and we will still have equity (at least $275). We sell the home and then the first and HELOC will go away. And the HELOC is interest only, payment about $100/month. It's all about the gamble... my gamble is that I know that our current house will sell quickly within the range of 400K up..... But what if you don't sell in 30 days? What if the economy falls apart? Or....Or....Or....you will be risking your families home. You are risking your peace of mind. The list is endless on what you are risking. If you 'know' your home will sell so quickly, then put it up for sale and once it is sold move into an apartment for a few months while you house hunt. There is a reason no bank wants to buy into your plan. Think about that.
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Post by katlady on Feb 27, 2020 5:28:46 GMT
Yes, what mom said! Don't forget about the economy. It is in sort of a turmoil right now with the Coronavirus hurting businesses. People may not be able to buy a home in the next couple of months. I would sell first, then buy.
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samantha25
Pearl Clutcher
Posts: 2,912
Jun 27, 2014 19:06:19 GMT
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Post by samantha25 on Feb 27, 2020 5:56:36 GMT
The economy is great for selling now. That's my point...it will be s short time sale, like within 30 days. My house will sell, with minimum of 400K on the low end.... It will sell. I'm not listing at the maximum. It will sell, there's no if. I'm estimating on the low end. There's no tanking on the market here in Denver. Not now...
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samantha25
Pearl Clutcher
Posts: 2,912
Jun 27, 2014 19:06:19 GMT
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Post by samantha25 on Feb 27, 2020 6:09:39 GMT
I agree... but it's just the timing... I am pretty sure that our current house will sell within 30 days (home built in 2000). That's what I don't understand. It's what the brokers have to put on paper to finance the new loan. The comps in my subdivision are in the range have sold from $440-550 recently. I'm being realistic that we offer 400K to sell and we will still have equity (at least $275). We sell the home and then the first and HELOC will go away. And the HELOC is interest only, payment about $100/month. It's all about the gamble... my gamble is that I know that our current house will sell quickly within the range of 400K up..... But what if you don't sell in 30 days? What if the economy falls apart? Or....Or....Or....you will be risking your families home. You are risking your peace of mind. The list is endless on what you are risking. If you 'know' your home will sell so quickly, then put it up for sale and once it is sold move into an apartment for a few months while you house hunt. There is a reason no bank wants to buy into your plan. Think about that. Apartment rates are 2X our current mortgage ($2000 or more) so not an easy decision. My point is that we will have the equity but the timing/move is difficult..... We would have about $275 in equity if we sold our house first and currently the homes to purchase are crap in our area, considering we want to spend 599 K plus
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flatfish
Full Member
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May 26, 2019 3:17:27 GMT
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Post by flatfish on Feb 27, 2020 6:14:59 GMT
I would sell and then rent until I found the right house. The upside is you won’t be under pressure to buy just anything. Second, to the seller, they don’t have to worry about you not being able to sell your home to buy theirs.
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Post by mom on Feb 27, 2020 6:16:49 GMT
But what if you don't sell in 30 days? What if the economy falls apart? Or....Or....Or....you will be risking your families home. You are risking your peace of mind. The list is endless on what you are risking. If you 'know' your home will sell so quickly, then put it up for sale and once it is sold move into an apartment for a few months while you house hunt. There is a reason no bank wants to buy into your plan. Think about that. Apartment rates are 2X our current mortgage ($2000 or more) so not an easy decision. My point is that we will have the equity but the timing/move is difficult..... We would have about $275 in equity if we sold our house first and currently the homes to purchase are crap in our area, considering we want to spend 599 K plus Do what you want. You said you wanted suggestions, and IMHO this is very bad idea. Its such a bad idea that your bank won't go for it. But hey - you do you.
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samantha25
Pearl Clutcher
Posts: 2,912
Jun 27, 2014 19:06:19 GMT
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Post by samantha25 on Feb 27, 2020 6:33:00 GMT
Apartment rates are 2X our current mortgage ($2000 or more) so not an easy decision. My point is that we will have the equity but the timing/move is difficult..... We would have about $275 in equity if we sold our house first and currently the homes to purchase are crap in our area, considering we want to spend 599 K plus Do what you want. You said you wanted suggestions, and IMHO this is very bad idea. Its such a bad idea that your bank won't go for it. But hey - you do you. your fucked... Of course I'll do want I want... but I wanted some alternative of other's experiences... like has anyone experienced this, what did they do, etc? or you're fucked? That's actually good advice... I have not signed any contracts so I would welcome some information gathering advice/experiences?
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Post by mimi3566 on Feb 27, 2020 10:36:47 GMT
Is renting the only option if you sell first? We sold first and lived in an RV for 6 months waiting for new construction. Perhaps you could buy or rent an RV (used) and live in an RV park for a few months. The monthly rental for a spot in an RV park is much, much cheaper than an apartment/house. It wasn't ideal but knowing it was temporary was worth it. Another option is family nearby....again, living with family is not ideal but knowing it's temporary could make it an option.
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peaname
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Posts: 3,389
Aug 16, 2014 23:15:53 GMT
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Post by peaname on Feb 27, 2020 10:43:38 GMT
We sold and paid month to month for an apartment. Rent a storage space for his equipment if he uses it. If not, sell it. The pain of moving twice means you can sleep at night and not worry about two mortgages and you won’t have to accept a low offer.
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Post by verdepea on Feb 27, 2020 11:27:57 GMT
Yep the gym equipment is the least of your worries. I dont trust this economy and would take the risk even if the banks would say yes.
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Deleted
Posts: 0
May 19, 2024 14:41:13 GMT
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Post by Deleted on Feb 27, 2020 11:33:31 GMT
Does the district you want to be in offer open enrollment? If not, get in and make a case that you are moving to the district. Then rent where it is cheaper (and hopefully, short-term or month-to-month lease options) and drive them to school. Most important thing is you don't need to be in a crazy rush to sell and can maximize the equity you get out.
Also, just because your realtor tells you that you can't make a contingent offer doesn't mean you can't. You drive the terms and a realtor that understands your situation and has properly vetted your sale will make a case for you. You aren't moving to a price range that cash offers are expected - yes, there may be some, but most buyers are probably in your same situation.
I understand what you are trying to do from a financing perspective, but no way would I do it. And the economy IS absolutely a concern. I think there will be some turmoil and I think it will affect housing markets. Best thing is for you to sell now and take advantage of it while it's hot and maybe it will cool off a bit and you will gain some advantage when you buy. No one expected the 2008 recession a year in advance. We sold a home in fall 2007 and moved to a rental while we built a new house. New house started in Jan and was running 1 month behind as we got into Sept. Our mtg broker (who has a very calm, flat personality) was freaking out that we had to get done so we could close (cabinet maker was the hold-up). We made it happen and a long time after the fact our mtg broker told us that if we had delayed 1 more week, he wouldn't have been able to close our loan and we would have had limited to no financing options for a long time, partly due to demand and values dropping so quickly. I don't think anything that extreme will be happening, but why not be prudent? Selling and buying is stressful enough, but it's way more stressful when you put yourself in a dicey financing arrangement, too.
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Deleted
Posts: 0
May 19, 2024 14:41:13 GMT
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Post by Deleted on Feb 27, 2020 11:45:43 GMT
But what if you don't sell in 30 days? What if the economy falls apart? Or....Or....Or....you will be risking your families home. You are risking your peace of mind. The list is endless on what you are risking. If you 'know' your home will sell so quickly, then put it up for sale and once it is sold move into an apartment for a few months while you house hunt. There is a reason no bank wants to buy into your plan. Think about that. Apartment rates are 2X our current mortgage ($2000 or more) so not an easy decision. My point is that we will have the equity but the timing/move is difficult..... We would have about $275 in equity if we sold our house first and currently the homes to purchase are crap in our area, considering we want to spend 599 K plus That rental rate is pretty typical of in-demand areas, but if that is a concerning price for your budget, PLEASE make sure you are factoring in what your property taxes and homeowners insurance will be on the new house. Our taxes are over $7k a year and insurance had crept up to $6k (we switched and more than halved that). It adds more than $1K to our monthly mortgage payment and has steadily increased over time. If you are in a "good" school district, I'm sure taxpayers are paying for it, too. I don't know if that is how it works in CO, but that's MN for you. And I live in a suburban rural area. My house in the metro suburbs would be at least double the taxes.
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Post by houstonsandy on Feb 27, 2020 13:40:07 GMT
Never been in this situation but just throwing out this question.... Is it possible to list your home with a contingency that you can stay and rent it for...say...2 or 3 months...to give you time to find a new place? Then you at least don't have to move more than once unless you don't find something in that time frame?
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Post by jassy on Feb 27, 2020 13:52:05 GMT
But, things still happen.
I'll give you a current example from a hot market. My BIL and his wife found their dream home on their current street. They bought it without their house being on the market, and then rushed to get their house to market. They current house is GORGEOUS and they've done so much to it. Just a picture perfect house in a great neighborhood. They had something ridiculous like 10 offers in first day. They went under contract, and then....BAM...the inspection happen. A ton of issues were uncovered that they were not aware of, most of them small but a couple moderate. Their buyers pulled out and now they are legally required to make that inspection availalbe to all other buyers. They are working furiously and making a ton of fixes ($$$), but now that their house has sat for 30 days, it has a "stink" on it in this super hot market where things are selling quickly, especially with that inspection report, even though they have addressed/are addressing things. THey moved into their new house last week - so TWO mortages, a HELOC and all the cash they are outlaying on fixes. They are STRESSED.
I just moved in October. We did a domino closing on our old house and new house - it was the most stressful thing in the world! Both DH and I actually ended up with bronchitis and pneumonia in the weeks following closing probably because our immune systems were shot from all the stress over those 6 weeks. Thankfully, the people we were buying from loved us, wanted us in their beloved home, and weren't in a hurry to move. It all worked out, but if I ever had to to this again, I would move somewhere in between to not go through that hell.
If you are totally set on doing it the way you are saying, I highly recommend you do your own inspection on your house first so you can fix anything you might not know about that could cause a snag.
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Post by pierkiss on Feb 27, 2020 13:56:30 GMT
There is no chance I would have 2 mortgage payments + a HELOC payment. I would sell my home and rent until I found a new home. Is it going to take some extra moving? Yeah. But not having three loans would be worth it for me. Yeah. I would have a nervous breakdown trying to deal with all of that. I would definitely sell and rent and then buy again later.
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lizacreates
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Posts: 3,856
Aug 29, 2015 2:39:19 GMT
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Post by lizacreates on Feb 27, 2020 13:59:50 GMT
There is no chance I would have 2 mortgage payments + a HELOC payment. I would sell my home and rent until I found a new home. Is it going to take some extra moving? Yeah. But not having three loans would be worth it for me. I agree... but it's just the timing... I am pretty sure that our current house will sell within 30 days (home built in 2000). That's what I don't understand. It's what the brokers have to put on paper to finance the new loan. The comps in my subdivision are in the range have sold from $440-550 recently. I'm being realistic that we offer 400K to sell and we will still have equity (at least $275). We sell the home and then the first and HELOC will go away. And the HELOC is interest only, payment about $100/month. It's all about the gamble... my gamble is that I know that our current house will sell quickly within the range of 400K up..... But you already said above you can’t qualify. ?? So how will you do it? Also, I know that some lenders generally do not approve a HELOC if the house being used as collateral is already on the market. Look into this and make sure before investing more time pursuing.
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Post by pierkiss on Feb 27, 2020 14:01:25 GMT
Is renting the only option if you sell first? We sold first and lived in an RV for 6 months waiting for new construction. Perhaps you could buy or rent an RV (used) and live in an RV park for a few months. The monthly rental for a spot in an RV park is much, much cheaper than an apartment/house. It wasn't ideal but knowing it was temporary was worth it. Another option is family nearby....again, living with family is not ideal but knowing it's temporary could make it an option. That would only work if there is an RV Park in the school district the OP wants. I can tell you in our area, there are absolutely no RV parks in the school zones for the top middle and high schools in my county. They are waaaaaay far away in less than stellar school zones. If you have school of choices it might work if you can apply to get your kids into the zone you want, and they are accepted. But I’m guessing that’s not the case here, as the OP is moving specifically to be in the desired zone.
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Post by Darcy Collins on Feb 27, 2020 14:39:04 GMT
I agree with houstonsandy that renting your existing house back might be possible to avoid two mortgages and moving twice. Often times in an extremely hot market, the lower the prices are so in demand, that sellers have a bit of leverage and it's easier than trying to buy with a contingency to sell.
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Post by bigbundt on Feb 27, 2020 14:58:33 GMT
Also, just because your realtor tells you that you can't make a contingent offer doesn't mean you can't. You drive the terms and a realtor that understands your situation and has properly vetted your sale will make a case for you. You aren't moving to a price range that cash offers are expected - yes, there may be some, but most buyers are probably in your same situation. This. Just because having a non-contingent offer is better doesn't mean you can't make one with a contingency. It just depends on what other offers the sellers might be getting and their motive. When we have sold our houses, we have always considered those with contingencies (but expected the offer price and closing costs to be higher TBH). The only time we asked someone to remove a contingency was when we had two identical, contingent offers. The realtor of one of the offers found out and said he knew 100% the house would sell in time so we told them if they were so confident, remove the contingency and they take the risk. Everything worked out perfectly on both ends. If it were me, I would try offers with contingencies and if those didn't work, rent even thought it is more money. You would just be in a better position to make a decision whereas if you carried two mortgages and HELOC, you might make a decision out of desperation and emotion.
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kelly8875
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Posts: 4,391
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Oct 26, 2014 17:02:56 GMT
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Post by kelly8875 on Feb 27, 2020 15:44:42 GMT
The banks are telling you that you don’t qualify. So your only real choice is to sell and rent before buying.
I think it sounds like you’re going to overstretch your budget in trying to move to this larger budget home. Taxes and insurance will also be an added expense. Are you sure it’s something you can realistically afford without stress?
And just because you don’t like the opinions here doesn’t mean it’s the wrong opinion. And this gym equipment is the last thing you should worry about.
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Post by Linda on Feb 27, 2020 15:53:50 GMT
I get that you really want your kids in this one particular school district but it doesn't sound like the ducks are lining up to make that happen at this point. It might be time to reconsider, see if there's a different school district or perhaps if the one you're already in is acceptable. Because honestly? It sounds like you already have a bunch of debt and the new house would be a stretch financially even without the creative financing the peas are warning you against. Sometimes we have to step back and look at our situations with a different eye....(((Hugs))) I know that's hard.
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Post by MichyM on Feb 27, 2020 16:12:02 GMT
Do what you want. You said you wanted suggestions, and IMHO this is very bad idea. Its such a bad idea that your bank won't go for it. But hey - you do you. your fucked... Of course I'll do want I want... but I wanted some alternative of other's experiences... like has anyone experienced this, what did they do, etc? or you're fucked? That's actually good advice... I have not signed any contracts so I would welcome some information gathering advice/experiences?
Ok below is my experience. FWIW I too agree that’s in your situation it’s best to sell first then buy. {ETA: I have deleted the body of this because the OP has had the opportunity to read my personal experience about buying before selling, and I don't need it out here on the internet for perpetuity.} This is the only circumstance I would ever consider buying before selling. In your situation there is no way in the world I’d consider doing what you want to do. There are some smart cookies here. Listen to them. You’re being unreasonably stubborn in my opinion.
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Post by chaosisapony on Feb 27, 2020 16:30:12 GMT
The market here is insane too. When I bought in 2018 any reasonably priced house was snatched up with a cash offer in about 48 hours of the house listing. I made some contingent offers, well above asking price, and each time lost to a cash offer of a lesser amount. So I get your frustration!
I moved all of my stuff into storage and lived with my parents for a few months while I found something to purchase. It was still hard but without having the contingency my offers were at least considered. In your shoes I would sell your current home and rent something. Yes it's expensive to rent but it seems like the best way to go about what you are trying to accomplish. Plus then you get to take your time finding the perfect house. Two mortgages and a HELOC payment would be as much or more than rent I would think.
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Post by Basket1lady on Feb 27, 2020 17:50:08 GMT
I’m one that overspent on our Boston house for the good school district. And I would do it all again in a heartbeat. We rented instead of buying because at the time, there were only 2 houses for sale that were under one million and one was mid-renovation and didn’t have any walls. Is renting a house for the school years a possibility? It’s generally cheaper in the long run because you aren’t carrying PMI, HOA fees, taxes, etc. the downside is that you aren’t building equity. We’re military and move too often to buy, so we never really seriously considered buying, which helped that decision a lot.
But we were definitely house poor and we didn’t have any debt going in. We made the decision because our DS had been physically assaulted at his old school, we were moving anyway, and I had a boy genius who just didn’t fit in. I needed to keep him safe and I needed a curriculum that was more than your average school. Parochial school didn’t have the academic program that he needed and we couldn’t afford private school. I will say that our Boston school was better than I could have ever dreamed. Best of all, I had the staff working and advocating for DS and the rest of his schooling was a huge success because they gave him the tools to acclimate and I found rigorous academic programs for HS the next time we moved. I can’t say enough about what a good decision it was for us, but it was terribly difficult to live with so little fun money
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Post by catmom on Feb 27, 2020 18:27:03 GMT
We did exactly that and it worked out fine, but do make sure you have enough wiggle room in your finances to cover property taxes, utilities etc for 2 months and money to cover the time to sell plus close if it goes longer than 30 days. We had that issue and in the end decided to rent the house out and we actually came out ahead, but you have to have buffer in your finances to cover the unexpected.
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