3 Proven Methods to Use Your Home Equity for a Seamless Move

By Rob Gintner

Rob assists people who want to ensure a smooth and efficient transition into a better space to call home, allowing them to embrace a more fulfilling lifestyle.

Are you eyeing your dream home but hesitant to make the move because you haven’t sold your current one yet? Don’t let the fear of a drawn-out selling process hold you back. With the right approach, you can leverage the equity in your current home to secure your new home before you even list your property. Here are three savvy strategies to consider:

1. Home equity line of credit. A HELOC serves as a second mortgage, allowing you to borrow cash against the value of your home without selling it. Most lenders offer up to 85% of your home’s equity, providing you with substantial funds to facilitate your home purchase. However, it’s essential to act swiftly, as HELOC approvals often take longer than traditional mortgage approvals.

2. Bridge loan. A bridge loan is a short-term financing option that utilizes your home equity as collateral. With this loan, you can access up to 80% of the combined value of your old and new properties. While bridge loans typically have faster approval times compared to HELOCs, they often come with higher interest rates and stringent eligibility criteria, catering mostly to individuals with excellent credit and significant equity.

3. Third-party services. Companies like HomeLite or NOC offer an innovative solution for homeowners looking to buy before selling. These services assess your equity and home value to provide you with an approved amount. Subsequently, they purchase your new home with an all-cash offer using the approved funds. You then have the flexibility to move into your new home, sell your old one at your convenience, and repurchase the new property from the company using the proceeds from your sale.

Each of these options presents distinct advantages and considerations, depending on your specific circumstances. Whether you prioritize speed, flexibility, or financial terms, there’s a solution tailored to meet your needs.

Don’t let the traditional home-selling process hinder your homeownership aspirations. By leveraging your equity wisely, you can smoothly transition into your new home without the stress of waiting for your current property to sell. If you have any questions or need further guidance on navigating these options, feel free to call or email for personalized assistance.