Eyeing a new place in Farmingdale but not ready to list your current home? You are not alone. Many homeowners want the freedom to shop confidently for their next place without juggling back-to-back closings. In this guide, you will learn your best options to buy before you sell, what they cost, how timing works in Kennebec County, and how to reduce risk. Let’s dive in.
Is buying before selling realistic in Farmingdale?
It can be, depending on your equity, financing options, and the current pace of the market. Inventory in parts of Maine has been tighter than in past years, which can make non-contingent offers more competitive. Spring and summer often bring more listings and faster activity in New England, while fall and winter can be steadier.
Before you act, check up-to-date local metrics like days on market, months of inventory, and recent sales. A current valuation for your home and a frank conversation with a local lender will show how practical a buy-before-you-sell plan is for you right now.
Your main options to buy before you sell
Bridge loan
A bridge loan is short-term financing that uses your current home’s equity to help you buy the next home before you sell. Lenders underwrite based on your equity, credit, and income. The loan is usually paid off when your current home closes.
- Pros: Lets you write a strong, non-contingent offer; adds flexibility on timing.
- Cons: Higher interest and fees than a standard mortgage; you carry more risk if your home takes longer to sell.
- Best for: Owners with solid equity who want to compete for a desirable property.
HELOC or home equity loan
A home equity line of credit or second mortgage taps your current home’s equity for a down payment on the new home. You apply before you make an offer, and you repay it when your current home sells.
- Pros: Often lower cost than bridge loans; flexible access to funds.
- Cons: Adds a second lien; you may carry two payments temporarily.
- Best for: Owners with good equity and steady income who want flexibility.
Home sale contingency
You make an offer on the new home that depends on the sale of your current home within a set period.
- Pros: Reduces the risk of two mortgages; no short-term financing needed.
- Cons: Less attractive to sellers in competitive situations; deadlines add pressure.
- Best for: Homes with longer days on market or when buyer demand is moderate.
Rent-back to align closings
If you sell first, you can negotiate to remain in the home for a short period after closing. Terms like rent amount, deposit, and length are written into the contract.
- Pros: Buys time so you do not have to move twice.
- Cons: Not a true buy-before-sell solution; relies on buyer approval.
Short-term rental or temporary housing
You can secure the new home and use temporary housing or rent your current home for a short period to smooth cash flow.
- Pros: Avoids bridge financing; gives breathing room.
- Cons: Paying rent plus a mortgage can be costly; consider landlord obligations if you rent out your home.
Hybrid approaches
Some buyers increase the earnest money deposit, request extended settlements, or blend a small bridge line with a flexible contingency. These hybrid moves can make your offer stronger while keeping safeguards in place.
Costs, risks, and budgeting
Build a conservative budget so you are not surprised:
- Financing costs: Bridge loan or HELOC fees and interest.
- Carrying costs: Two mortgage payments, property taxes, insurance, utilities, and maintenance if you own two homes for a period.
- Prep and sale costs: Staging, minor repairs, professional photography and tours, listing costs, and standard closing expenses.
- Move costs: Movers, storage, and possible temporary housing.
Plan for a cushion of 3 to 6 months of carrying costs in case your home takes longer to sell than expected.
Timeline examples that work in Maine
Scenario A: Strong equity, bridge loan
- Get pre-approved for your new mortgage and bridge financing.
- Make a non-contingent offer on the new home; close when ready.
- List your current home immediately with pricing and presentation aimed at a timely sale.
- Repay the bridge loan at closing.
Scenario B: Contingent purchase
- List your current home first and accept an offer.
- Make an offer on the new home with a 30 to 90 day contingency window.
- Align inspections and appraisals; adjust deadlines as needed.
- Close on both properties in sequence.
Scenario C: HELOC route
- Open a HELOC before you shop.
- Use HELOC funds for the down payment on the new home.
- Close on your new home; then list and sell your current home.
- Pay off the HELOC at sale.
Local inspections and approvals to plan for
In Maine, buyers often order several inspections that can affect timelines and negotiations. Build these into your plan:
- Septic system inspection if the home is on a private system. Subsurface wastewater systems are regulated in Maine, and septic condition often drives negotiations.
- Well water testing for homes with private wells.
- General home inspection for structure and systems.
- Shoreland and floodplain review if the property is near water. Farmingdale’s proximity to the Kennebec River means you should confirm flood maps and any shoreland zone rules.
- Appraisals and valuation checks for both the new loan and any bridge or HELOC product.
Maine closings commonly involve real estate attorneys and title companies. Expect standard title searches, title insurance, and recording with the county Registry of Deeds. Property taxes are prorated at closing based on local schedules.
Quick decision framework
Use this snapshot to narrow your path:
- Choose a bridge loan or HELOC if you have strong equity and want a competitive offer.
- Try a home sale contingency if the market pace allows and you prefer less financial risk.
- Consider temporary housing or a rent-back if you want to sell first and reduce stress.
- Plan for extra inspections and timelines if the home involves septic, well, floodplain, or shoreland factors.
Pre-move checklist
- Get your current mortgage payoff and a realistic equity estimate.
- Speak with a local lender about bridge and HELOC options; secure pre-approval for your new mortgage.
- Request a comparative market analysis to price your current home competitively.
- Map out closing steps with your agent, attorney, and title company.
- Schedule inspections early for both properties where applicable.
- Budget for 3 to 6 months of potential double carrying costs.
- Discuss rent-back or short-term rental plans in case timelines shift.
How Hoang Realty supports your plan
When timing matters, you want a team that knows Kennebec County and has the systems to keep things moving. Hoang Realty pairs local guidance with premium listing presentation that helps your current home attract more buyers faster. Our complimentary Hommati 3‑D tours, floorplans, and professional photography are standard, not add-ons. You also get a team-based approach with transaction coordinators to keep dates and details aligned.
If you need to bridge the gap with a short-term rental or want to hold your current home briefly, our rental and property management support can help you evaluate options. Ready to talk strategy for Farmingdale and nearby communities? Connect with Hoang Realty to map the right path for your move.
FAQs
How do bridge loans work when buying before selling in Maine?
- A bridge loan uses your current home’s equity as short-term financing so you can purchase first, then repay the loan when your home closes; expect higher costs than a standard mortgage and plan for tight timelines.
Will carrying two homes affect my mortgage approval for the new home?
- Yes, lenders evaluate your full debt-to-income; unless your current home is under contract with conditions that allow exclusion, the existing payment typically counts toward your DTI.
How much equity do I need for a HELOC or bridge loan?
- Many lenders look for combined loan-to-value ratios within a conservative range; exact requirements vary by lender, so consult a local bank or credit union before you shop.
Are home sale contingencies accepted in Farmingdale?
- They can be, especially for homes with longer days on market or when competition is lighter; in faster markets, sellers often prefer non-contingent offers.
What inspections should I expect in Maine purchases?
- Common inspections include general home, septic, and well water testing, plus shoreland and floodplain checks if the property is near water; schedule these early to avoid delays.
What happens if my home does not sell within my bridge loan term?
- You may need to request an extension, adjust pricing and marketing to accelerate the sale, or refinance; plan a conservative budget and timeline to reduce this risk.
Are there tax considerations when selling a primary residence?
- You may qualify for a federal capital gains exclusion if ownership and use tests are met; consult a tax professional for guidance specific to your situation.
