Needing to buy a home before you sell your current one is a common problem. Timing the sale of your old home with the purchase of a new one only gets more complicated in a competitive market where homes sell quickly and often for more than the asking price.
Fortunately, there are a number of buy before you sell companies that can help. These services are for people who don't have a lot of cash on hand and are relying on the value of their current home to purchase the next one.
Many of the same companies also have cash offer services for home buyers who want a competitive advantage when they're making an offer.
Which service is right for me?
If you only need to sell a home, many of the companies that offer buy before you sell or cash offer services will also buy your home from you.
Looking for something else?
While buy before you sell services are convenient, they aren't available to everyone — they operate in limited markets, and not all homes and customers in those markets will qualify.
Even if you qualify for buy before you sell services, you might still have to find your own real estate agent.
If home trade-in services aren't an option for you, consider going with a discount agent or an iBuyer.
Where do buy before you sell companies operate?
Some companies operate only in certain local markets within these states. Please check each company's review page for more information.
Best for timing a sale and purchase: buy before you sell companies
Chances are, your home is your most valuable asset, even if you still owe a little bit on the mortgage. Buy before you sell companies can help you unlock the value in your current home to make an offer on a new home.
Most people don't have enough cash on hand to simply buy a new home before selling their old one. And qualifying for a second mortgage can be difficult or impossible if you still have to pay the first one.
The traditional path is to time the sale of your old home with buying a new home so you can use the proceeds from the sale as a down payment on your new mortgage. But in a market where homes are selling quickly, you have to cross your fingers and hope that the home you want is available the same time you sell your old one, and you make a strong enough offer to have it be accepted.
Buy before you sell programs work by providing you with a bridge loan — a short-term loan backed by the value of your current home — so you can make a strong offer BEFORE your old home sells.
Most companies will also allow you to make this offer in cash, giving you an advantage over competing offers. That's because a cash offer gives the seller a fast and easy way to close on the home without any strings attached.
Once the offer on the new home is accepted, you'll get a traditional mortgage (through the trade-in company or on your own, depending on the service). When your old home sells, the company takes the proceeds to pay off the bridge loan.
Top buy before you sell companies
Orchard is one of our top picks because it lets you stay in your new home rent free until the old one sells — which could save you thousands of dollars. Most other companies charge you rent or make you start paying your mortgage during this time. Orchard also gives you an interest-free loan to fix up your old home before you sell.
Knock is best for people who want to use their own agent in the process. Knock is very similar to Orchard, but Orchard requires you to use its in-house agents for buying and selling. Knock also provides an interest-free loan of up to $25,000 to get your old home ready for the market.
Homeward is a good alternative to Knock if you want to use your own agent but Knock isn't available in your area.
Flyhomes is another option if you are looking to buy a home in the ultra-competitive California or Seattle markets.Customer reviews say it is good at making strong offers and winning homes. Flyhomes also operates in Colorado, Massachusetts, Oregon, and Texas.
Other companies to consider
Ribbon gives you two options to make an offer. If you close using financing, Ribbon charges 1% for the service. A cash offer costs 2–2.75%.
EasyKnock (review coming soon!) allows you to stay in your home while you shop for a new one. You sell the home to EasyKnock and then rent it back until you move out.
Best for buying in a competitive market: cash offer services
Many of the same companies that allow you to buy before you sell also provide ways to place a cash offer on a home, giving you an advantage over other offers in a seller's market. These services — called cash offer services or power buyers — are designed with buyers in mind.
Even if you have enough equity in your home to afford an additional mortgage, it might not matter if you can't win a bidding war for a house in a competitive market.
Cash offer services enable you to make an all-cash offer on your next home, giving you a leg up over offers that use financing or ask for favors, like a delayed closing to give the buyer time to sell their own home (favors like this are called contingencies).
When using a cash offer service, you'll bring all cash to the table, meaning you won't have to wait for financing to come through. And because you don't need to wait for your old home to sell, you can close at any time.
Why are cash offers stronger than other offers?
Home sellers prefer cash offers over financed offers because they don't need to wait around for the loan to be approved and there's no risk of the loan falling through and sinking the deal.
Cash offers are more likely to be accepted, especially when the market is hot. A 2021 study in Denver found that buyers making offers using traditional financing had to make offers on seven different homes before being accepted, but buyers using cash only needed to submit an average of 1.1 offers before closing the deal.
A cash offer company gives you a loan for the new home based on your credit score.
Instead of coming to the seller with an offer that involves financing like a traditional mortgage, you'll present the offer using the company's cash.
Once you close on the home, you'll take out a traditional mortgage to pay the cash offer company back.
Top cash offer companies
*These fees are waived if you choose the company for your mortgage lender.
**Paid for by the seller.
- Orchard can help you make an all-cash offer on a home. It charges 4% — a little more than the typical 2.5–3% buyer's agent fee — but this will be paid for by the seller.
- Opendoor doesn't charge buyers a fee for this service because commission is paid by the home seller. But you can earn 1% off the purchase price of the home if you use one of the company's agents.
- Knock's cash offer, called Knock GO (Guaranteed Offer) has a lender fee of $1,450 for the buyer.
- Homeward is an affordable choice — its 1.9% fee is completely offset by a rebate if you choose to use its lending service.
- Flyhomes also gives you a rebate on its cash offer service if you use Flyhomes Mortgage as your lender, effectively eliminating its 1% fee.
Many traditional lenders are starting to get into the cash offer business as well, proving that it's a legitimate and useful service for homebuyers.
How to deal with other common buying/selling problems
If you're changing jobs or going through personal life changes that require you to move quickly, buy before you sell services can help you find your new home without waiting on your old home to sell. You can put a competitive offer on your new home and then live there until your old home sells. You get to move into your new home quickly and then just wait until the old house sells.
If you are a first-time homebuyer, cash offer companies can help you as well. A bridge loan or cash-backed offer can help you make a strong offer that will help you win the bid on the home quickly, then you can convert the bridge loan into a standard mortgage.
If you only need to buy, first consider using a traditional agent or a discount agent along with a traditional mortgage. It's not necessary to pay more to use these services under most circumstances.
But if you're in a competitive market, many home trade-in companies also provide cash offer services to help you make a strong offer on a new home with no financing contingencies. You'll need to qualify for the bridge loan to make the cash offer, but you won't need another home to use as equity.
When the company closes on the loan, you'll then buy it from them using a traditional mortgage.
Most sellers only need a traditional agent or discount agent to sell their home, especially if they're in a seller's market. But if you're looking for speed and convenience, many of the companies mentioned in our list can help. If you've inherited a home or are moving in with another person and you only need to sell, some of these services will buy your home from you.
Another option is an iBuyer, which will pay you a near-market price for your home quickly, with no showings.
Alternatives to buy before you sell services
Many of these buy before you sell or cash offer companies operate in limited areas where the housing market is a good fit for their business model.
Even if you want to buy and sell in a market where they do business, your home must meet their qualifications, including having enough equity in your home to borrow against.
If you don't live in the right area or don't have enough equity to borrow against, you have two main alternatives: iBuyers and discount agents.
An iBuyer is an alternative that provides a fast way to sell while getting a fair price. iBuyers (companies like Opendoor and Offerpad) also offer a flexible timeline, which could allow you to coordinate the move-out with the purchase of your new home.
Another option is a traditional agent or discount agent. An agent can help you make competitive offers, think of creative financing options, work with your budget, and help you save money. Keep in mind that some of the buy before you sell services require you to find your own agent, as well.
Plus you could save even more with a discount agent. Our partners at Clever Real Estate can match you with a 1% commission agent, helping you save thousands in fees.
👋 Next Steps: Talk to an expert!
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Ready to get started? Give us a call at 1-833-2-CLEVER or click to learn more. Remember, this service is 100% free and there’s never any obligation.
Frequently asked questions about buying before you sell
Can you buy a home before yours is sold?
Yes, companies offering buy before you sell or home trade-in services use the value in your current home to lend you the money you need to buy a new home. You can focus on selling your old home once you have moved into the new home. Find out more about buying a home before you sell.
Can I make an offer on a house before mine is sold?
Using a buy before your sell or cash offer service, you can make an offer on a new home before selling your current one. These companies use the value of your current home to lend you the money to make a strong offer on a new home, entirely in cash in some cases. Find out more about cash offer companies.
Should I pay off my mortgage before selling my house?
Most people don't have their mortgage completely paid off before selling. You can sell your home first and use the proceeds to pay off the mortgage and put a down payment on a new home. If you want to buy first, buy before you sell companies can help. Find out more about how you can buy a new home before selling your old one.
What is a power buyer in real estate?
A power buyer is a company that helps homebuyers make a cash-backed offer on a new home. Cash offers are more enticing for sellers because they are the quickest path to closing, with no strings attached. Find out more about power buyers.
Zavvie. "Q4 21 Seller Preferences Report." Accessed March 17, 2022. Updated February 1, 2022.