How to Avoid the Double Mortgage When Building a New Home in Dallas-Fort Worth

by Steve

Introduction: Why the Double Mortgage Trap Catches So Many Buyers

Building a new home sounds exciting—until you realize you might be stuck paying two mortgages. One on the home you live in. Another on the one still under construction. That financial squeeze keeps a lot of buyers on the sidelines.

The good news? You have options. With the right timing, financing strategy, and prep, you can build your dream home in Dallas-Fort Worth without carrying two mortgages at once.

This guide breaks it all down—without the jargon.

Neighborhood Spotlight: Where New Construction Is Booming

If you’re looking to build new in Dallas-Fort Worth, these communities offer strong inventory, flexible builders, and resale-friendly timelines:

Forney

Master-planned communities like Devonshire and Gateway Parks offer great schools, walking trails, and builder incentives that help you time your sale.

Celina

Known for its growing builder presence (Perry, Highland, M/I Homes), Celina allows more flexible closing dates—ideal when selling your current home first.

Mansfield

Offers high resale demand and newer developments with builder-backed financing partners. Great if you're leveraging a construction-to-permanent loan.

Explore new construction options here: Dallas-Fort Worth New Construction Homes

Local Market Trends: Why This Matters More in 2025

With high demand and low resale inventory, more buyers are building instead of buying existing homes.

2025 DFW Stats (Redfin + CoreLogic):

• New construction closings up 24% YoY

• 32% of buyers delayed building due to “fear of carrying two mortgages”

• Average time to build: 6.8 months

• Median home price: $449,000

• Mortgage rates: Hovering around 6.25% – 6.75%

“Most people think double mortgages are unavoidable when building. They’re not. You just need the right loan structure and sale timeline.”
— Jason Fuller, Mortgage Consultant, Dallas

Cost Breakdown: What a Double Mortgage Looks Like (And How to Avoid It)

Cost Type Avg. Monthly Amount Avoidable? Existing Mortgage $2,100 Construction Loan Payment $1,700 Temporary Housing $1,400 Property Taxes (on both) $600

You don’t want to juggle that. Here's how to not end up here.

Builder & Community Insights: Who Can Help You Avoid the Overlap

Top Dallas builders often offer more flexible closing options, rent-back programs, and on-site lenders with specialized products.

Perry Homes

Offers extended move-in dates, which can give you time to sell before your first construction payment hits.

Highland Homes

Known for their flexibility and experience with buyers using construction-to-permanent (C2P) loans.

Bloomfield Homes

Some communities offer 90- to 180-day closing windows, letting you sell first with breathing room.

Pro Tip: Download this New Construction Home Guide before you sign a contract—it helps you map your timeline right.

Financing & Incentives: Strategies That Prevent Two Mortgages

Here are the top ways to avoid the double mortgage trap when building new:

1. Use a Bridge Loan

This loan uses the equity in your current home to fund the down payment on your new build—without selling first. You repay it after your current home sells.

When it works best:

• You’re in a hot market with high resale demand

• Your current mortgage is nearly paid off

Learn about your selling options here

2. Ask About Construction-to-Permanent Loans

This loan funds construction and then converts into a traditional mortgage once the home is complete. You only pay interest during the build.

When it works best:

• You’re keeping your existing home until move-in

• You want one closing and one set of fees

Start here: Get Pre-Approved

3. Sell Your Current Home First + Leaseback

Sell your home now, but lease it from the new owner for 60–90 days while your new home finishes.

When it works best:

• You need a flexible transition

• You want to unlock your equity now

Calculate your home’s readiness: Home Seller Score

4. Use the Builder’s Incentives Wisely

Many builders offer:

• Closing cost coverage

• Delayed first payment options

• Temporary interest rate buydowns

Ask what’s available. It can cover part of your overlap expenses.

Join the New Construction Webinar to learn how these incentives work.

Conclusion: You Don’t Have to Carry Two Mortgages. Really.

Avoiding the double mortgage comes down to three things:

1. Right financing (C2P or bridge loan)

2. Right timing (sell before you close)

3. Right builder (with incentives and flexibility)

You don’t need to be stressed while building. Plan early. Work with a pro. And always ask about your options.

Download the Lone Star Living App now
Use the New Construction Guide
Save money with the Rebate Program

You're Always Home With Refind Realty!

FAQs – Real Buyer Questions About Avoiding Two Mortgages

1. Can I avoid paying two mortgages when building a house?

Yes. With the right financing and sale strategy, you can avoid or minimize overlapping payments.

2. Should I sell my house before building a new one?

If you need equity for your next down payment, yes. But use a leaseback or temporary housing plan so you’re not homeless during construction.

3. What is a construction-to-permanent loan?

It’s a mortgage that funds your build and automatically becomes your permanent mortgage after completion—only one closing and interest-only payments during the build.

4. How long will I have to pay both mortgages?

If you plan it right—you won’t. A leaseback, bridge loan, or builder incentive can remove the overlap entirely.

5. Is temporary housing better than a double mortgage?

Sometimes, yes. If you can stay with family or rent affordably, it can save thousands compared to carrying two full mortgage payments.