Teresa

Here’s a quick look at some articles that caught my eye over the past week:

JLP talked about retirement risks.
Jim talked about when frugality is a fault.
Flexo is having trouble with his TIAA-CREF SEP-IRA.
FMF talked about the best place to sa…

These two to the left look happy now, but just wait until that house sits on the market for 8 months and they're carrying two mortgages because they already bought a new place. That's the topic J.D. at Get Rich……

I’ll second the home equity line of credit. Thanks to some frugal living we paid off our line of credit that covered 10% of our old (first) house. When we found our dream house, we could instantly extract money from that line of credit to slap onto the new home’s down payment, making the process very easy.

In the end, the profit from the old home sale covered our entire new home’s 20% down and we could instantly pay off the home equity line we opened for that.

Also if you buy/sell at the same time (which is obviously best). It’s often possible to get a rent back from your buyer to stay in the home for a few days to make moving easier.

FT
http://www.milliondollarjourney.com

When I bought my current house, I already had a contract to sell the old one. I was able to schedule the closings for the same day.

The house I was buying was empty, so the sellers let me move my stuff in a few days early. That way, I could give possession of the old house to my buyer at the closing.

Unfortunately, my buyer backed out on the day of closing, and left me in the lurch. All my stuff was in the new house. I had to redo the financing to buy the new house. (The old loan and the new loan were both FHA. Since you can’t have two FHA loans at once, I had to change the new loan to conventional.)

I had to agree to pay the sellers rent (for allowing me to store my belongings) while I got everything straightened out. The rent was pro rata based on their mortgage payment, which was over $1,600/mo.

Fortunately, I found another buyer for the old house fairly quickly, so I never had to make double mortgage payments. But I did have reduce the sale price of my house to make it work.

Of course, this doesn’t work in a very active market, but as the market has been down some lately, you can easily do this.

Of course, when this happens, the real estate agent usually continues to market the house, so if they get a new potential buyer, you usually have 72 hours to remove the contingency, or you lose the contract.

That’s when you need to decide if you can go to 2 payments a month for a while, or if you’d rather wait and play it safe.