How Is A Cash Offer On A House Different?
If you’re wondering what the difference is between financed offer and a cash offer on a house, there are a few things to keep in mind. Taking a cash offer can be good for some situations, and not good for others. Depending on the market, condition of the property, financial situation, or timeframe, it may or may not make sense to accept a cash offer.
A cash offer on a house differs greatly from a regular financed offer in a number of ways.
Here’s how a cash offer on a house is different:
- Cash offers are more likely to close because there are no financing contingencies.
- Cash offers can close faster.
- Cash offers have less sales costs associated with them. I.E. no financing costs, etc…
- You often do not need appraisals when accepting a cash offer.
- Buyers are less likely to pull out when giving cash offers.
- A cash offer on a house usually comes “As-Is”; the buyer usually buys the property “As-Is”.
When cash offers make sense:
- A cash offer would make sense if you house needs updating or repairs.
- If you need to sell quickly a cash offer on a house might make sense.
- If you want to sell in the easiest way possible, a cash offer would be the best route.
- If your property will not qualify for financing.
- In times where credit is hard to obtain.
- Cash offers provide more certainty.
When cash offers don’t make sense:
- If your house is in great shape, and is up to date.
- If you want full market value and are in no rush to sell.
- If you do not mind the extra hoops you have to jump through to obtain financing.
- In times of easy credit and if your house doesn’t need work a cash offer might not make sense.
In deciding if a cash offer is the best route to take, make sure you weigh your options and your situation. Sometimes the certainty of closing is enough for people to want to go ahead with a cash offer, even if it’s lower than a conventional offer. To others, it doesn’t matter if their property falls out of escrow because of financing.