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House Swaps in Big Canoe?
By Karin Elliott | March 2, 2008
What on earth is a house swap? Is it legal?
Yes it is legal and it is a great way to avoid the “on the block” parade.
Here is the scenario: Owner Bob has a house that he has had as a weekender and loves Big Canoe so much that he’s ready to find a permanent home in Big Canoe. Owner Jane has her Big Canoe house for sale but it’s a slow market and she is looking for a smaller mortgage but wants to remain in Big Canoe with all her friends. There is a way to get Bob and Jane to find each other. They can house swap. (Pardon the oversimplification, I was an elementary school teacher and sometimes the simplest explanations work the best)
How does the house swap theory work? There are a lot of people who don’t want to bother with selling their homes in this market. They are selling because they either want to upsize or downsize. I have had several inquiries regarding house swaps and how they work and I don’t shy away from it if I think both sides are realistic. It seems very complicated but when you look at it from the outside it is very simple.
There are two sales that take place. First both parties have to agree on prices for each others’ homes. Then they have 2 separate purchase and sale contracts. There are two inspections and there will also be two sets of closing costs. Buyers usually pay for their own closing costs. Both parties may or may not have agents. Participating agents get paid in accordance with the lisiting agreements. If you are concerned about getting anothe rmortgage, talk with your lender about the swap. There are several ways to work around the financing if you are prepared in advance.
You have read the idea and it all seems so simple. However the hardest part is finding two parties that both love each others’ homes. In parting sometimes an “almost” house (that can be tweaked) with a promise to buy your house is a lot easier to achieve then the “IT” house that you have to wait for until your home sells. This market is trick and you need to be creative. Look for a swap! It may save you some aggravation.
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