Buying a New Home? Sell Your Old One First

For most consumers, owning two homes -- and paying two mortgages -- is a financial impossibility. That makes trying to time the sale of an existing home with the purchase of a new home all the more stressful. Your best bet in today's market is to focus on selling your existing home first.

In normal times, most homeowners wait until they've found their dream home before putting their existing home on the market. That's no longer a good idea, explains Dorcas Helfant-Browning, a Virginia-based real estate agent and past president of the National Association of Realtors. "People used to put an offer in on a new home with a first right of refusal, contingent upon their ability to sell their old home," says Helfant-Browning. "Now you're better off putting your home on the market first."

By accepting an offer on your old home before shopping around for a new one, you're more likely to qualify for a better mortgage rate. Lenders aren't as keen to approve you for a second mortgage if there's a chance you'll be making payments on two mortgages simultaneously. And that's unfortunate given that mortgage rates are at historic lows. ...