What are your options if you can afford to buy a new home but can't afford to sell current home?

TBHomeBuyer
Contributions:2

We bought our townhouse three years ago, and at the time our plan was to move up to a single detached home after three years - which is around this time. However, we are one of the many whose mortgage/home equity balance is now much greater than the value of the townhouse. We can afford to buy a single detached home, but we do not have the cash reserve to pay off the balance of our current mortgage (estimated at around $70K) with the townhouse's current value.

Are there any options that will allow us to take out a loan to pay off the mortgage balance for our current home? We can afford the monthly payment for the mortgage of the new home and another loan if the terms of this loan are similar to that of a mortgage/home equity (e.g. 30 year amortization or 15 year ballon over 30 year amortization).

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May 29 2009 - US

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Replies (3)

Naoma Doriguzzi, "Naoma Doriguzzi"
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You could rent out your current home if you really need to upgrade to a bigger house until the market changes.

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May 29 2009

TBHomeBuyer
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Unfortunately, we don't have this as an option. Our potential rent income cannot be counted when qualifying for a second mortgage. I also read in another post that we can only have one FHA mortgage.

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May 29 2009

real estate mike
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Here's what I'd do. You had a three year goal and the economy is delaying you a bit, that's life. Keep paying some extra on where you live now and make a new goal. Rent this one and buy what you want is a very bad idea in this economy, when you're upside down on this one. You didn't mention how far "under" you are. Find out from a pro; maybe you've been seeing all the doom and gloom. Is it possible to make this one worth more with some do-it-yourself work?