If you’re considering putting your home on the market for sale here in SW Florida, there are dozens of details to consider.
A buyer may approach you – or your real estate agent – with a purchase offer, but it may be contingent on the buyer getting a mortgage loan, unless they’ve been pre-approved. Another buyer might offer to buy your house for all cash, removing many potential obstacles to a successful sale.
Let’s take a closer look at accepting an all-cash offer to purchase your property.
Consider Your Specific Circumstances – Some people are not in any hurry to sell their home. In fact, there are those who put their home up for sale almost as a fishing expedition – if they’re offered the right number, they’ll sell. If not, no harm, no foul. But other sellers may be facing specific circumstances that dictate they sell their property quickly, and with the least amount of hassles and potential obstacles.
Some scenarios that may dictate a cash purchase offer makes more sense include a home that is bordering on foreclosure, and the owner is no longer able to make the mortgage payments. A cash purchase offer can eliminate the need for a foreclosure and relieve the burden on the current owner to keep up with the payments.
Certain life events can also be a good reason to accept a cash purchase offer, like a sudden death of a spouse or the immediate need to relocate in order to care for an aging family member. Those circumstances call for a fast sale, and a cash deal can move the process along much more rapidly.
A home that has become a physical burden on the current owner is also a catalyst for accepting an all-cash purchase offer. If an older person owns a home they can no longer take care of either physically or financially, the offer of a cash purchase may make sense, getting them out from under the stress and monetary challenges of home maintenance, property taxes, homeowners insurance and more.
Benefits of Receiving an All Cash Offer
There are many reasons that accepting a full cash offer makes good business sense.
No Need for an Appraisal – Buyer’s going through a traditional mortgage loan to buy your home will be required to pay for a home appraisal so the lender can decide if the loan makes sound financial sense.
With a cash purchase, no appraisal is required, which removes one more hassle and saves time. A low appraisal may result in the lender turning down a potential borrower, which means they’re not able to complete the transaction.
No Home Inspection Required – Just as in an appraisal, a professional home inspection can be another problem in a purchase offer, and mortgage lenders do require them. A cash buyer will not be required to use a home inspector, eliminating one more possible hurdle in a successful sale.
Still, some savvy cash buyers will still order a home inspection in order to determine if there are any serious issues before closing the deal.
Fewer Life Disruptions – When you list your home for sale, you’ll be expected to make sure it is ready to show at all times and interrupt your life by leaving the property when the sales agent says they are coming over to show your home.
Even if a cash offer may be slightly less money than another offer you’ve received, getting on with your life and relocating faster will eliminate all those continuing inconveniences.
Inheriting a House You Don’t Want – If your parent passes away and leaves you their real estate property, it may be that you have no need for it. You could rent it out, but the hassles of becoming a landlord may not make sense for you. A cash buyer can alleviate you from paying the property taxes, insurance costs, property upkeep and repairs and dealing with tenant hassles quickly, and at a fair price.
Damaged Homes – In Florida, Hurricane Ian devastated thousands of homes, mobile homes, and condominiums in September 2022. Depending on the condition of your home after sustaining heavy damage, you may decide that rebuilding does not make economic sense and a cash buyer can be a good opportunity to move on.
No Back-and-Forth Negotiations – A cash buyer will eliminate the need for buyer and seller to undergo time-consuming negotiations. The terms and financial arrangements of a cash property purchase are much more stress-free than with a potential buyer who needs to go through the mortgage loan process. This is a huge time saver when it comes to getting out of your home.
Eliminate the Sales Commission – In Florida, the seller is responsible for paying the commission to the sales agent who facilitates the sale. This can range anywhere from 5% to 7% and mean a sizeable amount of more cash out of your pocket. If you accept a cash offer from a buyer, you’ll add that amount back into the proceeds of your sale.
An offer of all cash to purchase your home, depending on your specific circumstances, may represent the best way to sell your home in the shortest time and with the fewest headaches.
If you receive a cash purchase proposal, you can also use the services of a reputable real estate attorney to review the purchase offer to protect your legal rights and ensure the deal is a legitimate purchase contract.
Cash home buyers may be property investors with available funds to acquire properties as a long-term rental property, or an entity which has plans for making improvements to the home and either live in it or re-sell it.
If you feel the cash offer is fair and equitable to all parties involved, it can be the best real estate decision for your situation.