It's a good time to trade up to a home that suits your circumstances better than the one you have now. Before interest rates go up any more, you will be able to afford a larger mortgage, and your present home will be affordable to a larger group of people.
If you want to buy before selling, you have to decide how to do it before your home equity is available to you. That could be tricky. Here are some ways to do it:
* Some home builders offer plans that allow up to 100 percent of the purchase price to be financed by a qualified buyer. If you take this route, financial advisors suggest taking a short-term adjustable rate mortgage (ARM) with an eye toward refinancing when you receive the proceeds of your home sale.
* You could take a second mortgage on your home to cover the down payment.
* In some cases, you can take a first mortgage on the new home and second mortgage to be paid off when you sell the one you have now. Any second mortgage should be a low-rate ARM.
In all cases, it's important to be realistic about the amount of cash your home will generate. It's better to plan on the low side of what the proceeds may be than to be overly optimistic about the amount of money the sale will bring.