Cash Buyer is not necessarily an advantage....

[samclem]

+1 on the "ask for a higher deposit", but I disagree on the financing: if the buyer had a rate locked in for x days (especially during an environment where the rates have risen a huge percentage-wise amount in a short time), I highly doubt the financing company would patiently wait on the sidelines while the lawyer plays the "let's see how many weeks I can draw this out" game and keep the funds at a pre-approved rate for weeks on end.

Right, but that same "deadline" can be accomplished with a properly worded acceptance. And if it was an offer from a non-cash buyer who still needed to obtain financing, then the potential delays are increased.

It's a minor point, but I just don't think the cash/non-cash thing makes a big difference if the person buying the property gets cold feet, hires a lawyer who wants to "make a statement" etc.

 

[JoeWras]

Currently helping Dad sell his place. We took the cash buyer offer over a mortgage (about the same price). Now there's a "slight delay." But to be fair, it is still an aggressive schedule.

I'll give more details later after this settles one way or the other... But I'm starting to agree that OP's title of this thread is spot on.

 

[Katsmeow]

Well, to give the other side I have been a cash buyer and have sold to a cash buyer with no issues at all.

 

[pb4uski]

+1 In fact when we sold out house the main reason we accepted their relatively low offer compared to our expectations is that they were a cash buyer and had no contingencies other than a home inspection. I figured that their offer gave me the same cash in hand as listing it with a realtor, selling at the market, paying the realtor commission and carrying the property during the likely selling and closing period and this party wanted to close asap. We had one serious issue with the home inspection and they brought in a structural engineer to evaluate it. Once he had made them comfortable with the issue, they wanted to accelerate the closing by over a week. We agreed subject to them allowing us to store some stuff in the garage for a few days since we weren't all moved out at that point.

 

[LoneAspen]

Grats on the closing!

 

[sheehs1]

Well, to give the other side I have been a cash buyer and have sold to a cash buyer with no issues at all.

The only other thing I might add to this thread is as someone who has put in cash offers I feel I have to particularly cautious regarding the property. Everyone wants that deal to go thru including the agents.

I have had a tendency to dot my i's and cross my t's. In all cases so far in this resort community we have been looking at, it has paid off. But had I left it up to the agents or appraisers, we would have proceeded with property we would have regretted as things came to light with pest or mold inspections, surveys and CAMA lines, building codes...etc.

It can be a daunting thought to drop a half million or so on a property one may have spent 30 minutes in even if it was two or three times. I spend more time picking out a car! But that seems to be what some agents want you to do in resort communities.

 

[haha]

It can be a daunting thought to drop a half million or so on a property one may have spent 30 minutes in even if it was two or three times. I spend more time picking out a car! But that seems to be what some agents want you to do in resort communities.

I think the main problem is that agents have a totally different goal from buyers. The buyer is going to lay out something between a meaningful and a frightening amount of money, and he needs it to work out long term. The agent just wants to get some of that money so he can go home.

When I think about the agent's thought process, I am reminded of a Dr. John song about another ethically challenging situation.

Dr. John - Such a Night - YouTube

Ha

 

[sheehs1]

Very true Ha! And in fact I've had an agent tell me this very thing in not so many word a couple of times. Her words, "If you don't buy it, someone else will". LOL!
(BTW - I ran from the subtle manipulation)

 

[SVHoper]

Congrats on the sale!

Just a small comment. I have only experienced CA where it seems to me to be all about the contingencies - these can be for items such as inspections or for loan. Cash removes the loan contingencies, but if all other contingencies remain in place, then these still offer opportunities for delay and contract cancellation.

From a buyer perspective, cash, 10-15 day closing and leaving inspection contingency gives the buyer an out for the first part of the contract, but still makes the terms look attractive.

I have only sold to those with a mortgage, and luckily no problems but 30+ days of waiting for certainty means the actual closing for me was very anti-climactic compared to the offer where I wanted to be excited but couldn't celebrate until settlement.

 

[LoneAspen]

As a cash buyer, the only contingency I would remove is anything dealing with getting funding, or any type of Funding Objection deadline.

All others would remain in place. I would still want objection deadlines around Inspection, Title work, Survey, and Appraisal. Although, since funding isn't an issue, and the closing date is likely moved up a lot because of that, the actual deadlines will be tighter as well. But they're still an "out" for the buyer.

Especially on the inspection. Not sure about in other states, but in Colorado you could get out of a contract (and get your earnest money back) via the inspection objection for just about any reason. You could just say the buyer objected to the condition of the property and elects to terminate the contract. Didn't have to get specific, or give the seller a chance to correct. That's why, as listing agents, we always wanted the inspection objection deadline as soon as possible after the contract was executed, usually within 5 to 7 days. We wanted that "get out of jail free" card out of the way as soon as possible, so we could mark the property as Active again on the MLS if the buyer changed their mind for any reason.

 

[JoeWras]

I have some advice due to experience. If you have a cash buyer, hold them to it!

We had a cash buyer and through the kindness of our heart, we let the cash buyer convert to a loan buyer. In the end it all worked out OK due to some excellent representation by counsel.

It was just a delay, but if I had to do it over again, I'd ask my attorney to hold the buyer to the contract on threat of contract breach if they try to do something else. I'm too nice. Remember, cash means fast and easy. This wasn't. My mistake was being nice.

Don't want to get into details, but this is what earnest money is for. Like I said, it was OK, but I did a lot of sweating. Our attorney really earned their pay, with multiple extra correspondences and closing calculations. The OP talked about nit-picks. We had those. I understand, because we had every possible flavor. It would have stopped real quick if we told counsel to "put the hammer down" right away. Counsel eventually did put the hammer down on my behalf. I love my lawyer today!

Maybe I haven't given up on real estate. I'll just take this as experience. It is too bad that in America (maybe the world), if you are nice, you get stomped on -- or at least they try to stomp on you. What has happened to decency in this world?

 

[eytonxav]

While any real estate transaction can go awry, I would much prefer a cash buyer, since a buyer's mortgage lender can leave you up in the air until actual closing wondering whether they will fund or not, although you would at least have the buyers earnest money if the lender didn't come through.

We sold our mega mansion back in August in 2 days and at asking price, and had money down on a new gated home that will be a major downsize for us. The fast sale and top $ seemed almost too good to be true, and I kept thinking something is going to go wrong. Lost a lot of sleep between worrying about the inspection, appraisal, and then the lender funding, but it all turned out OK. Now we are just waiting for our new home to be finished which hopefully will be in the next week.