Using Equity To Invest
I am selling my current home with no equity in it. So, I am selling it at the appraised price..My goal is to purchase another home below appraisal value and use the equity to invest in property...What are the pros and cons to this?
Why not sell it on a Lease Option and create equity in it..get a down payment in the form of Option money and adjust the price for the duration of the option. At the end of the option period, the buyer gets their own financing and you get your equity from the sale and you also get a monthly income from the payments.
Are you selling your home for more than you paid for it? Are you selling your home for more than your mortgage payoff?
If the answer to either question is YES, then you probably have equity. You know for sure how much when you walk away from the settlement table with cash in your pocket.
If the answer to my questions is NO, then what is your compelling reason to sell at a loss? Remember there is no tax benefit to taking a loss on your primary residence.