Qualify to buy before you sell

Lender approval tied to debt ratio, current home equity

The appeal of buying before selling is that you know where you’ll be living next and you may avoid having to move to an interim rental, which is frequently the case if you sell your home before buying a new one.

An often insurmountable hurdle to buying your next home before selling the current one is today’s rigorous mortgage qualification requirements. Most homeowners can’t qualify.

However, if you’re an all-cash buyer and don’t need to jump through hoops for a mortgage lender, buying first makes sense, particularly if you have no intention of selling your current home. Some buyers in this position keep the current home as an investment and rent it out.