Thinking About Buying Before Selling? You’re Not Alone.
For many current homeowners, selling your home before buying a new one feels like walking a financial tightrope—stressful, uncertain, and full of compromises.
Whether you’re relocating for work, upsizing for your growing family, or simply looking to avoid rushed decisions, buying before you sell offers more control over your timeline and outcome.
But how do you actually make it happen without carrying two mortgages or draining your savings?
This guide explores practical mortgage strategies that let you buy first—along with insights into how Federal Hill Mortgage helps homeowners structure these deals with confidence and flexibility.
Jump to a strategy: Bridge Loan | HELOC | Cash-Out Refinance | Less Than 20% Down + Recast | Sale-Leaseback | Rent-Back Agreement
Why Some Homeowners Choose to Buy Before Selling
Key Benefits:
- Move at your own pace without pressure to accept the first offer
- Avoid temporary housing or storage costs between homes
- Make non-contingent offers in competitive markets
- Keep your current home staged for top-dollar resale
Common Risks:
- Managing two mortgage payments if your home doesn’t sell quickly
- Needing enough equity or financing flexibility to bridge the gap
- Market changes affecting your expected sale price
6 Mortgage Strategies to Buy a Home Before You Sell Yours
If you’re wondering how to buy a house before selling yours, these six mortgage-based strategies are where to start.
Bridge Loan
A bridge loan is a short-term loan that uses the equity in your current home to help fund the down payment on your next one.
- Typically repaid when your current home sells
- Can help you avoid making your purchase offer contingent on the sale
- Ideal for homeowners with substantial equity and homes likely to sell quickly
Federal Hill Advantage: We offer flexible bridge loan solutions tailored to your timeline and sale strategy.
HELOC (Home Equity Line of Credit)
A HELOC lets you tap into your home equity and access funds on an as-needed basis, often with interest-only payments during the draw period.
- Use the funds toward your down payment or moving costs
- Usually faster to close than a traditional refinance
- You must apply before listing your home for sale
Federal Hill Advantage: We provide fast, flexible HELOC options with competitive rates.
Cash-Out Refinance
A cash-out refinance replaces your current mortgage with a new one at a higher balance, giving you cash to use for your next home.
- May offer better rates than a HELOC depending on market conditions
- Works well if you have significant equity and want a fixed payment structure
- Be aware it can reset your loan term or affect monthly payments
Federal Hill Advantage: We guide you through the numbers to ensure this move fits your bigger financial picture.
Less Than 20% Down + Mortgage Recast
If you have enough liquidity for a small down payment, you can purchase your new home with less than 20% down and avoid selling first. Once your current home sells, you use the proceeds to pay down the new mortgage—and then request a recast.
- No need to refinance
- Reduces your monthly payment after the fact
- May help you avoid PMI depending on loan structure
Federal Hill Advantage: We help align your recast timeline with your home sale for maximum impact.
Sale-Leaseback Contingency
In a sale-leaseback, you sell your current home to a buyer but stay in it temporarily as a renter. This frees up your equity and buys you time to secure your next property.
- Works well in strong sellers’ markets
- Eliminates the need for temporary housing
- Requires the buyer’s agreement and flexible terms
Federal Hill Advantage: We collaborate with your agent to make this option part of a smooth transition plan.
Delayed Closing or Rent-Back Agreement
In some cases, you can negotiate with the seller of your next home to delay closing—or rent the home from them for a short period—giving you time to sell your current home after your offer is accepted.
- Keeps your timeline flexible without carrying two homes
- Requires strong negotiation and a competitive offer
- Most successful when paired with fast preapproval
Federal Hill Advantage: We support your negotiations with strong preapproval letters and clear communication with listing agents.
How to Choose the Right Strategy for You
Each homeowner’s situation is unique. Choosing the right approach comes down to four key factors:
Factor | affects these strategies |
|---|---|
Available Equity | HELOC, Bridge Loan, Cash-Out Refinance |
Timeline Flexibility | Sale-Leaseback, Delayed Closing, Rent-Back Agreement |
Down Payment Available | Less Than 20% Down + Mortgage Recast |
Market Conditions | Strategy timing and offer competitiveness |
At Federal Hill Mortgage, we analyze your full financial picture to recommend the best path forward—often blending strategies for better outcomes.
Real-Life Strategy: How One Family Bought First, Sold Later — Without Stress
Jason and Elena owned a home in Towson, Maryland, but needed to relocate to Silver Spring quickly for a new job opportunity. They were worried about two things: carrying two mortgages and missing out on the right home while waiting to sell.
We helped them create a custom strategy:
Step 1: They opened a HELOC on their Towson home before listing it, giving them access to $120,000 for a down payment.
Step 2: With a same-day preapproval letter from Federal Hill Mortgage and a non-contingent offer, they successfully purchased their Silver Spring home.
Step 3: After selling their Towson home 45 days later, they applied the proceeds to recast their mortgage, reducing their monthly payment significantly—without refinancing or starting a new loan term.
The result: A seamless move, a competitive offer that won the home, and a comfortable monthly payment thanks to smart strategy and expert execution.
Why Federal Hill Mortgage Makes It Easier
Buying before you sell doesn’t have to be complicated or risky. At Federal Hill Mortgage, we combine the flexibility of a broker with the power of a direct lender—so you get more options, faster closings, and personalized strategies.
What Sets Us Apart:
- Broker and lender model for better pricing and loan variety
- #1 producing loan officer in Maryland
- Same-day preapproval letters to strengthen your offers
- Extensive experience structuring buy-before-sell loans
- Direct access to mortgage experts—not a call center
We’ll help you navigate all your options and close with confidence.
Frequently Asked Questions
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What is a bridge loan and how does it work?
A bridge loan is a short-term loan that uses the equity in your current home to fund the down payment on a new one. It’s typically paid off when your old home sells and is ideal for homeowners with strong equity and quick sale prospects.
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Can I use a HELOC to buy a house before selling mine?
Yes. A HELOC allows you to borrow against your home’s equity to fund a down payment. It’s a flexible option with interest-only payments and can be set up before you list your home for sale.
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What is a mortgage recast and how does it help?
A mortgage recast lets you apply a lump-sum payment (from the sale of your old home) to your new mortgage’s principal and have the lender recalculate your monthly payments—without refinancing.
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What if I don’t have 20% to put down before selling my current home?
You can put down less than 20% and still buy, then recast your loan after selling to lower your payment and potentially eliminate PMI.
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What is a sale-leaseback, and when is it useful?
A sale-leaseback lets you sell your current home and remain in it temporarily as a renter. This gives you access to equity while allowing time to secure your next home.
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What is a rent-back agreement when buying a home?
In a rent-back, you negotiate with the seller of your new home to rent the property back to them temporarily after closing. This gives them time to move and gives you flexibility to sell your old home without overlap.
Ready to Buy Before You Sell?
Thinking about buying before selling? Let’s create your custom strategy.
You don’t have to choose between convenience and financial stability. We’re here to help you make a confident move—with a plan tailored to your goals.
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