Second-Time Homebuyer Guide

Disclaimer: This content may include information about products, features, and/or services that The Federal Savings Bank does not provide and is intended to be educational in nature. 

Buying your first home probably felt like stepping into a brand-new world full of new terms, big decisions, and a lot of emotions. Buying your second home may feel a bit different. You’re not starting from scratch this time, but you’re still stepping into a new chapter with a fresh set of goals and responsibilities.  

Perhaps you’re looking for more space. Maybe you’re ready to downsize. Or maybe life has simply changed, and your home needs to change with you. Wherever you are, this guide is here to help you move forward with confidence.  

In this article, we will share some things to consider as a second-time homebuyer heading back into the homebuying process. To be clear, we’re not necessarily talking about buying a second home, as in a vacation home or investment property, but rather buying a new primary home.

What’s different as a second-time homebuyer?

Buying a second home feels familiar, but it isn’t necessarily going to be the same experience you had the first time. You’re bringing knowledge about what worked well, what you’d change, and what you wish you’d known earlier. That experience may make each step feel a little more manageable compared to your first purchase. 

But there’s a chance that a lot has changed around you since your first purchase. The market, your lifestyle, and your finances may all look different than they did the first time you bought.  

You could have a new income to work with, or you could be facing different interest rates or higher home prices. Beyond that, you might have new priorities like finding a great school district or reducing your commute time.   

You might also need to consider some things you didn’t have to worry about the first time, like whether to sell your current home before you buy or how to use the equity you’ve built. These factors could play a big part in how you approach your process as a second-time homebuyer.

Start by defining your goals

Before you dive into the process, make sure you get very clear on your goals. Your goals shape every decision that follows, including your budget, your timeline, and the type of home that feels right for you now.  

Are you buying again because you need more space for a growing family? Are you trying to move closer to work? Are you downsizing? Whatever inspires your choice to make this move, name it clearly right at the start. 

You’ll also want to think about what to do with your current home. Should you sell it, or does keeping it as a rental fit your long-term goals? Each path comes with benefits and trade-offs, and knowing your direction early helps you line up the right plan.

Should you sell your home first or buy first?

This is a big question for second-time homebuyers: Do I have to sell before I can buy? The answer depends largely on your priorities and financial situation. Here are some things you should consider.  

Selling First

Selling before buying often seems like the most straightforward option for second-time homebuyers. When you sell your first home before buying, you: 

• Know exactly how much equity you have to work with, so you can more accurately predict how much money you’ll walk away with after paying your current mortgage and other costs.  

• Could have a more predictable budget. Assuming you do not have an overlapping mortgage or other pressing debts, and your home sells for a large enough amount, the remaining proceeds that come from the sale might be able to fund your down payment, closing costs, and may even give a financial buffer during the move. 

• Remove the stress of carrying two mortgages at once. This can be a complicating factor for buyers during their second time buying a home.  

However, you also need to consider: 

• You may need temporary housing. If you haven’t found your next home yet, you will likely need to find a place to stay in the meantime. Maybe you can save money by staying with family or friends, but you might need to find a short-term rental otherwise. 

• You may need to move twice or store belongings. Orchestrating two moves and finding a place to store your things between them can add time and cost to your process.  

Buying First

While this can be challenging for some buyers for a number of reasons, buying your next home before you’re able to sell the first can have some benefits: 

• You can move at your own pace. If you resolve to buy before selling, you might be able to avoid some of the stress of aligning the timing between sale and purchase.  

• You can avoid temporary housing. Once you close on your next home, you can move in, get settled, and focus on selling your old home on your own time. 

• You might get some extra negotiating power. The lack of a sale contingency may make your offer more appealing to sellers. However, this approach depends on your financial situation and level of comfort.  

Of course, there are some considerations to weigh if you plan to buy first: 

• You might need to qualify with two mortgages on your record. Until your current home sells, lenders may need to count both payments during qualification. Some buyers have the financial profile to do that; some don’t.  

• Funding your down payment and closing costs might be more complicated. Without proceeds from a sale, you may need access to more savings or consider alternative financing solutions like a bridge loan. 

• There may be a period of overlapping expenses. Carrying two mortgages, utilities, or upkeep costs, even briefly, can feel demanding. Be honest with yourself about your ability to handle that. 

Can a Bridge Loan help?

Bridge loans may be an option for borrowers who cannot sell their current residence before buying their next one. Generally, a borrower would take out a bridge loan to fund their down payment and other closing costs. Then, they would use the proceeds from the eventual sale of their current home to pay off their bridge loan. 

However, before you take on a bridge loan, note that: 

• Bridge loans are secured by your current home.  

• They will take a second lien position or better.  

Because bridge loans are secured against your property and are ultimately more debt you will need to pay down, they can be risky.  

How to decide what’s right for you

As we said before, deciding to buy first or sell first depends on your unique situation. But there are some things you can consider to guide your decision-making: 

• Local market conditions 

• Your own financial picture 

• Your timeline 

• Your risk tolerance

How to approach the buying process

As a second-time homebuyer, you have more experience this time around. So, let’s be sure we’re using it! For example, you can take what you learned during your first purchase and use it to refine your search. Consider what worked well before, how your lifestyle has changed since, and what features are non-negotiables.  

You may also benefit from working with a trusted real estate professional, whether an agent and/or REALTOR®. Maybe you could work with your previous team or find one that’s better aligned with your needs now.  

Finally, use your experience to help you craft a competitive offer. You likely now have a better understanding of how your offer will impact your finances. Your agent can help you align with the market.  

When things don’t go according to plan right away, you can also remember that that’s completely normal. Lean on your experience to stay grounded and keep your offers within a realistic budget.

Research buyer’s assistance programs

You may have heard of, or even used, first-time homebuyer programs in the past. However, there are also programs out there for repeat homebuyers. If you’re planning to move on from your current home, but think you may need some help to do so, check with your local or state housing authority. Depending on factors such as your income level or where you plan to move, you might be able to get some help from a buyer’s assistance program.

Final Thoughts

Buying your second home is a meaningful milestone. You’re stepping into the process with real experience, clearer priorities, and a stronger sense of what “home” should feel like for you. Although the market, your needs, or your finances may have changed since your first purchase, you’re not starting from scratch this time.  

By setting clear goals, choosing the right timing, understanding your options, and leaning on trusted professionals, you can approach this next chapter with confidence. Every move you make is informed by what you’ve learned, and that knowledge helps you navigate each step with a little more ease. 

Disclaimer: This content may include information about products, features, and/or services that The Federal Savings Bank does not provide and is intended to be educational in nature.