Key Information Processors & Loan Officers Need to Know

Buy Before You Sell affects the incoming residence's mortgage in two ways — assets and liabilities.


  • The final Buy Before You Sell Agreement will show the amount being wired to the title company (available Equity Unlock + 2nd lien payoffs)
  • The Equity Unlock loan note is used for proof of funds on the incoming residence's mortgage
  • The Loan Terms document is used in place of the Closing Disclosure, if needed
    • Except in Texas, where the Closing Disclosure is provided


  • Buy Before You Sell facilitates a fully executed purchase contract with no contingencies. It removes the current mortgage debt from the incoming residence's mortgage DTI.


How to set up the Equity Unlock loan in your LOS 

1. Set up the Equity Unlock loan as you would a bridge loan 

  • Except in Texas, where you should set it up as a HELOC with a 100 year term 
  • The loan has 0% interest, and $0 payment 
  • Total Equity Unlock = Proceeds (available Equity Unlock + 2nd lien payoffs

2. Add asset as funds from pending home sale 

  • The sale date is the incoming residence's closing date 

3. Exclude the mortgage payment debt 

  • When prompted to indicate why its being excluded, select 'Pending Sale'



What if an underwriter requests the Closing Disclosure for the sale of the departing residence?

  • HomeLight cannot provide the final  Settlement Statement/Closing Disclosure for the departing residence sale until closer to the end of the 90- day selling period
  • The Settlement Statement/Closing Disclosure is not needed per FNMA/FHLMC agency guidelines

Where will the Equity Unlock funds be sent?

  • Your client's funds will be sent directly to the incoming residence's title

When will the Buy Before You Sell documents be available? 

  • Residential Purchase Agreement & Final Buy Before You Sell Agreement  
    • After the departing residence inspection & final approval 
  • Equity Unlock loan note 
    • After the departing residence inspection, final approval, Equity Unlock loan closes, and the notary sends the documents back to HomeLight

What does the incoming residence's title need to know? 

  • The Equity Unlock funds need to be wired directly to them 
  • The overage must be disbursed back to the borrower