Will the bank count our current mortgage against us when we buy the next house?
Answered by Chris Deutsch, Founder & Editor
Licensed Minnesota Realtor #20382264 ·
The short answer
Most lenders count both payments against you — until your current house is sold or under a solid contract. It's the single biggest surprise for move-up buyers, and it's why strong households sometimes hear a 'no' that feels wrong.
On stage The 60-second answer
Captions on · Transcript below
The stage is set.
Chris's video answer is on its way. Until then, the short answer above says the same thing.
The transcript posts with the video.
The longer answer
The ways through are specific. A closed sale clears it completely. A signed purchase agreement on your house often lets the lender drop the old payment, depending on the program. Strong reserves — months of both payments in the bank — widen what underwriting accepts. Rental income on the departing house can count, but usually only with an executed lease in hand, not a plan to find a tenant. (Every program draws these lines differently; your lender walks you through the exact ones.)
The strategy answer: get pre-approved for the carry-both scenario before you fall for a house. If you qualify carrying two, everything after that is easier than you feared.
The next department over
What people in this spot usually ask next.
- Financing & ratesCan we use a HELOC on our current house for the down payment on the next one?Read the answer
- Financing & ratesWe have a 3% mortgage. How do we move without feeling like we're lighting it on fire?Read the answer
- Financing & ratesHow does financing a cabin or a second place up north work?Read the answer
- Financing & ratesCan we buy the next house now and put the sale money into the mortgage later?Read the answer
- Selling processMy agent wants our family photos put away and it feels like erasing us. Why?Read the answer
- Sudden wealth & business saleCan we win the house with a cash offer and put a mortgage on it later?Read the answer
From the editor's desk
“As Founder and Editor, I review, correct, and stand behind every answer.”
Is your situation more specific than the market? That's the one worth talking through.