Turning your equity into cash for the next home.
On paper it sounds simple: sell the old house, use the money for the new one. In practice there are three questions that decide how smoothly it goes — how much actually lands in your account, when it lands, and how you prove where it came from. Here’s the mechanics.
What funds your next down payment is net proceeds, not equity. From your sale price, subtract the mortgage payoff (request the exact quote — it runs slightly higher than your statement balance), agent commissions, and closing fees, transfer taxes and any credits to the buyer — typically 8–10% of the sale price all-in. The wire that arrives from escrow is the real number to plan around.
The cash arrives at your sale’s closing — so the order of operations matters:
Lenders verify where down-payment funds come from. Sale proceeds are the easy case: unlike gifts or cash, they need no seasoning time — your signed settlement statement (Closing Disclosure) is the paper trail. Keep the wire in one account and don’t shuffle it between banks mid-process; every extra hop is another document request.
A bigger down payment doesn’t just cover the purchase — crossing 20% down removes PMI, shrinks the loan, and can turn the same monthly budget into a meaningfully higher price ceiling. That’s why counting your equity is often the single biggest lift available to your Buying Power.
Toggle your current home’s equity into your Buying Power and watch the sell-to-move-up math update — both sell-first and buy-first paths.
Count my equity