I want to sell my current home & purchase a condo. I am a retired senior with a fully paid-up home. The condo is in construction to be finished in a couple of months.
If I list my current home, it may not sell in time to simply pay for the condo. Therefore I have been to see lenders. They all recommend against a bridge loan due to unavailability and also due to high costs. They also recommend against a Home Equity loan. The one I think would be the best is this scenario but I am asking for your guidance on which one is the better way to do this for any and all reasons.
Re-finance my current home and take a 0k loan at less than 5%. This loan would have no prepayment penalty. I would make a k down payment on the condo Then sell my home and pay off the refinance loan on the home & owning the condo free & clear.
The other alternative, is to take a mortgage on the new condo & pay it off when the house sells but that mortgage cannot be done until it is completed. Again, there would be no prepayment penalty. Also the seller will not do a contingency.
If I would take the loan on my current home I would not have a problem making the mortgage payments because they would be low enough for me to afford to do this for a few months while the house is listed. But I’m not sure if it makes things more complicated to sell a home with a mortgage on it or not?
I would like to keep the home & rent to my son for property taxes only but it would be less rent than FMV & I think the IRS calls it my second home & the tax benefit is lost. What a shame not to be able to help out.
Thank you,