Should You Sell First or Buy First in Richardson?

Should you buy your next Richardson home before selling your current one, or sell first and then buy? The choice can feel high stakes, especially when timing, school calendars, and budget all collide. You want a path that protects your equity and reduces stress without missing out on the right home.

This guide gives you a clear, local framework built around your equity, your financing capacity, and the current Dallas–Plano–Irving market. You will see the numbers that matter, the pros and cons of each path, and the Texas contract tools that help you control timing. Let’s dive in.

Start with equity math

Your decision starts with what you will net from your current sale and what you need to close on the next purchase.

• Estimated net proceeds from sale = Sale price − commissions/fees − seller-paid closing costs − mortgage payoff(s) − repair credits/concessions − prorated taxes/HOA.
• Cash needed to close on new purchase = Earnest money + down payment + new closing costs + prepaids/reserves + moving or overlap costs.
• Equity available for down payment = Estimated net proceeds − any debts/liens paid at closing.

If your net proceeds are the main source of your next down payment, selling first usually keeps financing simple. If you can qualify and bridge funds, buying first can be practical.

Illustrative example only

• Current home hypothetical sale price: $400,000
• Mortgage payoff: $250,000
• Selling costs: 6% commission ($24,000) + $3,000 closing/title/other = $27,000
• Net proceeds estimate: $400,000 − $250,000 − $27,000 = $123,000
• Target new purchase: 20% down on $600,000 = $120,000

Interpretation: In this illustration, sale proceeds roughly cover the next down payment. Selling first would supply the funds. Buying first would require a bridge solution to cover the down payment until your sale closes.

Can you carry two homes?

Lenders look at your total monthly obligations when you try to buy before selling. They review debt-to-income ratios, credit, reserves, and any second-lien payments. Underwriting rules vary by lender and product, and they shift with the rate environment.

• If you can qualify while holding your current mortgage, buy-first is possible.
• If you cannot qualify with two payments, selling first or using a sale contingency may be necessary.
• Some lenders consider excluding the departing home’s payment if you have an executed contract to sell with conditions met. Ask lenders about their specific overlays.

Richardson market context

Richardson sits within the Dallas–Plano–Irving area. Corporate relocations, regional job growth, and the Telecom Corridor support steady housing demand. In a low-inventory sellers’ market, listing agents often favor non-contingent offers. In a balanced or buyers’ market, sale contingencies and longer timelines are more acceptable.

For up-to-date local context, review inventory and days-on-market from your local MLS and association reports, plus regional economic commentary from trusted sources. Your strategy should match the competitiveness of your target submarket and price range.

Compare your options

Sell first

• Pros:
  • Lower financial risk and simpler underwriting.
  • You know your exact proceeds and can shop with confidence.
  • Lower or no overlap carrying costs.
• Cons:
  • Temporary housing or a second move may be required.
  • You could feel time pressure to buy if your rent-back window is short.

Best when your next down payment depends on sale proceeds, or when your purchase market is not hyper-competitive.

Buy first

• Pros:
  • You move once and avoid temporary housing.
  • You can write a strong non-contingent offer in competitive Richardson or Plano submarkets.
• Cons:
  • You carry two homes or pay for short-term financing.
  • Underwriting can be complex, with reserves required.

Best when you qualify with two payments and want maximum control over timing, or when your target neighborhood sees multiple offers.

Make a contingent offer

• Pros:
  • You avoid bridge financing and stay in your home until it sells.
• Cons:
  • Less competitive in tight markets.
  • Sellers may insist on strict deadlines and kick-out clauses.

Best in balanced markets or when your current home is likely to sell quickly with clear timelines.

Texas contract tools that help

• Sale contingency: Your purchase depends on selling your current home. Sellers often view this as weaker in multiple-offer situations, so expect tight deadlines and proof of listing and marketing.
• Kick-out clause: Allows the seller to continue marketing and accept a back-up offer. You usually have a set time to clear your contingency.
• Temporary leaseback: Texas standard addenda allow you, as seller, to remain in the home for a defined period after closing under a written lease. Terms should address rent, deposit, duration, and insurance.
• Strong pre-approval: Full documentation pre-approval strengthens a buy-first plan and improves seller confidence in your offer.

Financing tools to bridge the gap

• Bridge loan: Short-term loan against your equity to fund the new down payment before your sale closes. Expect higher rates and fees than a standard mortgage. Confirm repayment triggers and terms.
• HELOC or second mortgage: A revolving line or fixed second-lien secured by your current home. Useful for down payment funds, but lenders may count the payment when qualifying you.
• Cash, savings, or gift funds: Cleanest from a qualifying standpoint, subject to lender documentation rules for gifts.
• Cross-collateralized programs: Some lenders underwrite using both properties. These are more complex and vary by lender.

Sample timelines

Scenario A — sell first

1. List your current Richardson home.
2. Accept an offer and close in 30 to 45 days.
3. Move to a short-term rental or family housing, or negotiate a post-closing leaseback.
4. Shop with proceeds in hand and close on your next home.

Pros: known proceeds, lower risk. Cons: possibility of two moves. Risk mitigations include budgeting for temporary housing and securing a leaseback if needed.

Scenario B — buy first with bridge funds

1. Complete full pre-approval and line up a bridge loan or HELOC.
2. Write a non-contingent offer on the new home.
3. Close, move in, and promptly list your departing home.
4. Close the sale and repay the bridge or HELOC.

Pros: one move, stronger offers. Cons: higher carrying costs and underwriting complexity. Mitigate by pricing the departing home conservatively and keeping reserves.

Scenario C — contingent offer with kick-out clause

1. List your current home and make an offer contingent on its sale.
2. Agree to clear deadlines and allow the seller to keep marketing.
3. Once your sale is under contract and contingencies are met, remove your contingency and close.

Pros: minimal upfront financing. Cons: less competitive and subject to deadlines. Strengthen with solid earnest money and documentation.

Cost and risk checklist

Use this quick list to keep surprises low.

• Order a payoff statement from your mortgage servicer, including per-diem interest.
• Get an itemized, realistic net proceeds estimate from a local agent.
• Secure a full pre-approval for the next purchase.
• Request written term sheets from multiple local lenders for bridge, HELOC, or cross-collateral options.
• Budget for 2 to 4 months of reserves to cover possible overlap.
• Price and present the departing home to sell efficiently, with staging and professional photos.
• If selling first, negotiate a clear leaseback with rent, deposit, duration, and insurance responsibilities spelled out.

Decision flow

Follow these steps to choose your path with confidence.

1. Calculate estimated net proceeds and down payment needs.
2. Confirm with lenders whether you qualify while carrying your current mortgage.
3. Assess market competitiveness for both your sale and your target purchase.
4. Choose your timing strategy based on your tolerance for moving twice or carrying two homes.
5. Select financing and contract tools that match your plan.

If net proceeds are essential for your down payment and the market is balanced, sell-first may be best. If you qualify to carry two homes and your target Richardson neighborhood is competitive, buy-first can help you win.

When to buy first

Consider buying first if the following are true:

• You can qualify for a new mortgage while keeping your current one.
• Your target neighborhood in Richardson or nearby Plano tends to get multiple offers.
• You want to avoid temporary housing and prefer one move.
• You have reserves to handle overlap months and short-term financing costs.

When to sell first

Consider selling first if the following are true:

• Your down payment depends on sale proceeds.
• You prefer lower financial stress and fewer moving parts.
• Your current home is likely to sell quickly, making your purchase timing easier.
• You can handle a leaseback or a short-term rental if needed.

Your next steps

• Start with the numbers. Request a precise net proceeds estimate and confirm your qualifying position with a trusted local lender.
• Match your strategy to the market. Align your plan with current Richardson inventory and demand in your specific price band.
• Use Texas tools to control timing. Consider a sale contingency, a kick-out clause, or a temporary leaseback where appropriate.

If you want a clear, contract-savvy plan tailored to your Richardson move-up goals, reach out to schedule a conversation. You will get a step-by-step roadmap, including equity math, lender options, and timeline scenarios that fit your family’s calendar. Connect with Suzanne Millet-Realtor to start your plan.

FAQs

Can I make a sale-contingent offer in Texas?

• Yes. It is allowed, but sellers may prefer non-contingent offers in competitive markets, so support your offer with strong terms and realistic deadlines.

What is a kick-out clause and why use it?

• It lets the seller keep marketing the home while you work to sell yours. If the seller receives another offer, you have a set period to remove your contingency or step aside.

How does a temporary leaseback work in Texas?

• After closing, the seller remains in the home for an agreed period under a written lease that defines rent, deposit, duration, and insurance responsibilities.

Will my lender count my current mortgage when I buy first?

• Usually yes. Lenders include your existing housing payment and may require reserves. Some may allow exceptions with a signed sale contract and certain conditions.

What are the typical costs of a bridge loan?

• Bridge loans often carry higher rates and fees than standard mortgages and add overlap carrying costs. Compare written quotes with the cost of renting temporarily to decide.