<prompt> Human: Hello PF!I am toying with the idea of building a new construction house. My question is how do you buy a house if your money for the down payment for your new house is mostly in equity in the current house? My current house has about 150k in equity. The house I am thinking about building would cost 500k so a 20 down payment would be 100k. I have about half of that amount 50k in savings. With a new construction, you put a deposit down and then actually get the loan to purchase the home 9 months later when the house is completed. Do you put the old house on the market and hope the timing lines up? Are their short term loan options? Alternately, could I pull the money out of my 401k and then pay it back?  <response>: You dont actually have the downpayment. You dont have the down payment until you sell your house.You can sell your house and move into a rental. Some people will get campers and live on the property for months while the house is being built. You could move in with family, or get a rental for the time being. Or you could put off the new build for one more year and put more money into savings for the downpayment which will just put you in a much better position when you do sell your house. 