Anyone ever hear of this?

Buying a house is CASH? does that buyer immediately have the upper hand to anyone going through the banks?

I think the seller would probably select a cash buyer over a bank one.

I can't imagine ever having all of that cash though! Wow.

we offered cash for a house in port jeff when we were first looking and the idiot turned us down b/c he said he wanted a mortgage and $1,000 more than our cash offer! Didn't he realize that he didn't have to claim the exact amount we bought the house for and would have come out way ahead taxwise? The house ended up being on the market for 6 months after that and they ended up dropping the price by $60K by the time it sold!

We aren't in the financial postition to pay cash for a house ourselves, just that my FIL was able to loan us the cash and we would pay him back. I wish we had that much $$ lying around!

OH yeah seller would prefer that Im sure! Not to mention you would have more leverage as a buying.

My Mom did this, she offered the seller $25,000 LESS than the asking price in cash and they accepted!

My good friend worked on a closing over ten years ago where the young couple (mid thirties) paid for their $800,000 home in CASH!

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Posted by KimberlyBride

Contractors do this all the time. Much quicker that way. Probably very few first time buyers buy a home with 100% cash.

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that's how my FIL had cash for us! He buys houses with his friend and fixes them up and then resells or rents...... life is nice!

the 'all cash' tactic is a great way for your offer to appear more attractive, however you are under NO obligation (unless your loan app is denied) to pay all cash. we used this tactic when bidding on our soon-to-be house. coupled w/ the fact that we had nothing to sell and were flexible in re: closing date, our offer was more attractive then those that offered more money and less flexible terms. regardless of what we stated (no mortgage contingency), we ARE mortgaing 80%.

IMO (if one has the means) paying ALL CASH is EXTREMELY foolish. there are SO many other ways to leaverage your money. the house WILL (hopefully) appreciate regardless of how much equity is paid. a mortgage allows one (those that have the means) to invest the equitable money at an higher rate than the mortgage interest rate, earn interest on the investments, and deduct the mortgage interest. unless one is buying to flip, then there is no reason (IMO) to pay all cash.

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Posted by skew

the 'all cash' tactic is a great way for your offer to appear more attractive, however you are under NO obligation (unless your loan app is denied) to pay all cash. we used this tactic when bidding on our soon-to-be house. coupled w/ the fact that we had nothing to sell and were flexible in re: closing date, our offer was more attractive then those that offered more money and less flexible terms. regardless of what we stated (no mortgage contingency), we ARE mortgaing 80%.

IMO (if one has the means) paying ALL CASH is EXTREMELY foolish. there are SO many other ways to leaverage your money. the house WILL (hopefully) appreciate regardless of how much equity is paid. a mortgage allows one (those that have the means) to invest the equitable money at an higher rate than the mortgage interest rate, earn interest on the investments, and deduct the mortgage interest. unless one is buying to flip, then there is no reason (IMO) to pay all cash.

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So you're saying that you offered to pay all Cash...but then decided to go through mortgage?
I'm confused...We are also bidding higher than asking, will put 20% at contract and are pre approved and very flexible w/ timing...

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Posted by skew

the 'all cash' tactic is a great way for your offer to appear more attractive, however you are under NO obligation (unless your loan app is denied) to pay all cash. we used this tactic when bidding on our soon-to-be house. coupled w/ the fact that we had nothing to sell and were flexible in re: closing date, our offer was more attractive then those that offered more money and less flexible terms. regardless of what we stated (no mortgage contingency), we ARE mortgaing 80%.

IMO (if one has the means) paying ALL CASH is EXTREMELY foolish. there are SO many other ways to leaverage your money. the house WILL (hopefully) appreciate regardless of how much equity is paid. a mortgage allows one (those that have the means) to invest the equitable money at an higher rate than the mortgage interest rate, earn interest on the investments, and deduct the mortgage interest. unless one is buying to flip, then there is no reason (IMO) to pay all cash.

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We did exactly the same thing as per the advice of my parents. What it meant is that our offer wasn't contingent on us getting a mortgage. The seller still got their money in a timely fashion, but he didn't have to worry about us pulling out because we couldn't obtain a mortgage. Our terms were more flexible then others and we won the bid over 7 others that very first day as a result. My parents say they have done this and when they sold their home in Old Brookville someone offered cash the first day on the market, and they accepted. The guy ended up selling one of his homes in the Hamptons first and getting a mortgage, but it is more of a guarantee.

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Posted by Gonnacatchapeacock

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Posted by skew

the 'all cash' tactic is a great way for your offer to appear more attractive, however you are under NO obligation (unless your loan app is denied) to pay all cash. we used this tactic when bidding on our soon-to-be house. coupled w/ the fact that we had nothing to sell and were flexible in re: closing date, our offer was more attractive then those that offered more money and less flexible terms. regardless of what we stated (no mortgage contingency), we ARE mortgaing 80%.

IMO (if one has the means) paying ALL CASH is EXTREMELY foolish. there are SO many other ways to leaverage your money. the house WILL (hopefully) appreciate regardless of how much equity is paid. a mortgage allows one (those that have the means) to invest the equitable money at an higher rate than the mortgage interest rate, earn interest on the investments, and deduct the mortgage interest. unless one is buying to flip, then there is no reason (IMO) to pay all cash.

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So you're saying that you offered to pay all Cash...but then decided to go through mortgage?
I'm confused...We are also bidding higher than asking, will put 20% at contract and are pre approved and very flexible w/ timing...

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EXACTLY. we offered lower than asking, ALL CASH, 10% at contract and flexible terms. not sure how many other offers there were, but i guess ours was the most attractive. the reason why sellers prefer an all cash buyer is because it is a guaranteed sale even if the buyers are denied a mortgage.

we are mortgaging 80%. even if you do offer ALL CASH all that matters in the end is that the seller is paid and not who they are paid by.

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Posted by skew

seems like you have a VERY strong offer. have you heard back from the seller?

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They haven't decided yet. I don't know what's going on really :( You'll have to excuse my confusion - but, (really really new at real estate matters ) we will have no problem getting a mortgage from the bank. (pre-approval process showed us that).
Does that mean if I lose out on this house and find a different house eventually - that I can say to the real estate agents or homeowners that 'I will give you X amount of dollars CASH'. And when bid is accepted, proceed to contact a mortgage company (after 20% down) for the rest of it?

I know the bank cuts the homeowner a check - either way - is that considered a 'cash deal'.
Or is a 'cash deal' when I come to their house w/ a briefcase full of 100's? LOL....thanks.

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Posted by Gonnacatchapeacock

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Posted by skew

seems like you have a VERY strong offer. have you heard back from the seller?

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They haven't decided yet. I don't know what's going on really :( You'll have to excuse my confusion - but, (really really new at real estate matters ) we will have no problem getting a mortgage from the bank. (pre-approval process showed us that).
Does that mean if I lose out on this house and find a different house eventually - that I can say to the real estate agents or homeowners that 'I will give you X amount of dollars CASH'. And when bid is accepted, proceed to contact a mortgage company (after 20% down) for the rest of it?

I know the bank cuts the homeowner a check - either way - is that considered a 'cash deal'.
Or is a 'cash deal' when I come to their house w/ a briefcase full of 100's? LOL....thanks.

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cash doesn't mean currency in actual dollars, just means the purchase is not contigent on a mortgage. it is not uncommon for one to be denied a morgage. the ALL CASH tactic is a way to leaverage your offer. if you KNOW that you WILL be approved for a morgage in the amount that you desire, by ALL MEANS offer ALL CASH. again, all that matters in the end is that the seller is paid.

wanted to add that the ALL CASH offer is risky. it worked for us but the seller or seller's agent could have easily called our bluff by asking for written documentation of funds. not sure if you really have to disclose fund info but if you are offering ALL CASH the seller might want confirmation of funds. if you are unable (as we were if asked) to provide that info you run the chance of losing the house.

good luck to you. let us know what happens. don't see why the seller would not accept your VERY strong offer.