New Way to Buy a House When You Already Have One
No one wants to sell the house they live in before buying a new home: It usually means living in a rental, putting all your stuff in storage, or both. It also involves extra expenses and the hard work of making two moves. Home-selling platform Knock has an innovative approach to this challenge that offers some significant advantages.
HOW DOES KNOCK WORK?
First, Knock will evaluate your current home and financial situation. If approved, Knock will provide an interest-free bridge loan that covers the down payment on the new house and mortgage payments on the old house. You can move into your new home right away, paying only the mortgage on the new house.
Knock also provides up to $25k for any needed repairs and updates to get your home ready for the market. Once your old house is listed for sale, you won’t have to worry about keeping it show-ready because you’ll already be living in your new house.
When your house sells, you’ll pay Knock a convenience fee equal to 1.25% of your new home’s value (in addition to standard closing costs). You’ll also reimburse Knock for the down payment on the new house, the mortgage payments they made on the old house, and any repairs they may have covered.
On the off chance that your house doesn’t sell, Knock will buy it. They’ll give you their offer up front and you can decide whether to accept it.
KNOCK BENEFITS
You have the money you need for a down payment on a new house before selling your old house.
You have the money to make repairs before you put your house up for sale.
You only have to make mortgage payments on the new house while your old house is on the market.
You don’t have to live in your house while it’s on the market and being shown to potential buyers.
Knock will buy your old house if it doesn’t sell. But that’s unlikely—90% of their homes sell in three months or less.
THE BOTTOM LINE
If you want to purchase a new home before you sell your old one, and you can’t secure the financing or want to avoid two mortgage payments during the process, Knock’s program could be your solution. Knock is only open to select brokerages—to take advantage of the program, look for a Knock-certified agent.
Carrie Rowland is an Accredited Buyer’s Representative,® Certified Probate Real Estate Specialist,® Military Relocation Professional,® Graduate of the Realtor Institute,® Knock-certified agent and a Realtor-Associate at RE/MAX Alliance Group in South Tampa
