Just curious - is it hard to buy a house for cash?

[ivinsfan]

Our neighbor recently passed away so the kids sold off the property. Buyer paid in cash. They didn't bring a cashier's check to the closing, they brought cash. $1.7M in cash, all inside a metal briefcase.

OK that is super sketchy and how do you fit 1.7 into one briefcase...?
No way I'd take possession of all those greenbacks.

 

[friar1610]

Just as a data point, we’ve bought 2 houses for cash and were never asked to show any evidence of sufficient assets.

 

[ExFlyBoy5]

OK that is super sketchy and how do you fit 1.7 into one briefcase...?
No way I'd take possession of all those greenbacks.

No doubt. I am surprised that the closing agent/title company accepted it. That is about 37 pounds of paper (17,000 $100 bills) that would need to be checked for false bills. When my Dad passed away, he had a fair amount of cash in a safe and it took a couple of hours to get them cleared and deposited at the bank...and it was a lot less than 1.7m.

 

[calmloki]

Dang - and I was all puffed up by cornering a banker and getting mortgage insurance removed from an apartment building they held the loan on. Had to show we had a certain percentage of the loan available in available funds. We did - just - if I included greenbacks and gold. Went in with pockets of hundreds, a pound of gold and the morning's gold prices. Banker acted like I was showing him porn

 

[badatmath]

Our neighbor recently passed away so the kids sold off the property. Buyer paid in cash. They didn't bring a cashier's check to the closing, they brought cash. $1.7M in cash, all inside a metal briefcase.

Wow.

But yeah I'd be comfortable with a letter stating I had at least $x but not showing them my actual balance you know? These are total strangers. . . Though what they could do if they knew I had it is probably not much.

I wonder why it is okay to buy for cash but renting income is harder to prove. . .

 

[ExFlyBoy5]

Wow.

But yeah I'd be comfortable with a letter stating I had at least $x but not showing them my actual balance you know? These are total strangers. . . Though what they could do if they knew I had it is probably not much.

I wonder why it is okay to buy for cash but renting income is harder to prove. . .

When we bought our current home, we moved money around so that the funds availability letter showed a balance that was in line with the offer price.

 

[Teacher Terry]

12 years ago bought a foreclosure from the bank and they would only consider cash offers. Offer had to include a copy of the statement showing funds. When recently selling the house we received 4 offers. 2 were 30k over asking and the only cash offer was 45 less than those two. We didn’t take it. They would have closed faster.

 

[jim584672]

In my area I read half the sales are done for cash, and these homes are > $600K most the time.

 

[badatmath]

In my area I read half the sales are done for cash, and these homes are > $600K most the time.

I knew it was a thing at lower prices but never really gave it any thought. I am so tempted to go back to renting in retirement. . . once I get there. 598 more days.

 

[street]

Our neighbor recently passed away so the kids sold off the property. Buyer paid in cash. They didn't bring a cashier's check to the closing, they brought cash. $1.7M in cash, all inside a metal briefcase.

I like that!!
And they say, paying in cash is old school, and cash is going to be a think in the past. I thinking cash will never disappear and will always be expectable way of trading.

 

[pjigar]

I was wondering about this because I see people asking about proving income when they are using assets to qualify to rent.

Wasn't sure if a real estate agent would be skeptical of your ability to pay and I am sure many here have downsized and run into it.

Just curious. You don't need to tell me its not the best move as it is not a possibility anyway.

I have always asked for proof for funds before signing contract (cash or not) just to make sure the closing will go through. I all needed was a bank statements. Some buyers may hide account number for privacy and that was fine with me, as long as I can see correct name and current address on the statement.

 

[Freedom56]

We paid cash for our condo back in 2011 and saved a bundle on closing costs. In 2011 92% of the real estate transaction were all cash in Palm Beach County. There were a lot less forms to sign at closing.

 

[brett]

No problem paying cash for our last two homes.

No difference between cash and financing. The seller gets the cash. The owner ends up with clear and free title or a mortgage lien on the house.

On on last home purchase we did not pull the money out of the market until a week or prior to closing.

 

[ERD50]

Only if you do not have cash.

Same as others, no problem otherwise. Just had to provide some proof of funds. We wired the funds, I'd be very, very nervous about accepting a briefcase of actual green paper money. But I'm not sure you can turn it down, it is 'legal tender'?

But I'd want the green paper money counted by a bank, deposited to my account, and the bank handing me a receipt before I'd consider the transaction closed. What if there were some counterfeit bills in there, ones just in circulation, not purposely by the buyer? The bank's counting machine might catch those, and I think they confiscate them, and you lose.

-ERD50

 

[ivinsfan]

Same as others, no problem otherwise. Just had to provide some proof of funds. We wired the funds, I'd be very, very nervous about accepting a briefcase of actual green paper money. But I'm not sure you can turn it down, it is 'legal tender'?

But I'd want the green paper money counted by a bank, deposited to my account, and the bank handing me a receipt before I'd consider the transaction closed. What if there were some counterfeit bills in there, ones just in circulation, not purposely by the buyer? The bank's counting machine might catch those, and I think they confiscate them, and you lose.

-ERD50

The one plus million sale almost sounds like urban legend...in fact would you want anyone on earth to know you were carrying around a briefcase with over a million bucks in it? Strictly from a safety standpoint.

 

[jazz4cash]

The one plus million sale almost sounds like urban legend...in fact would you want anyone on earth to know you were carrying around a briefcase with over a million bucks in it? Strictly from a safety standpoint.

I agree. If true, it could be very attractive way to launder proceeds from criminal activity.

 

[JohnRM]

cash is king!

Sellers love a good cash offer, even better if "as is"... I bought this house that way, made offer with $5000 in earnest money down, after they countered (accepted offer but I wanted to keep their TV that was mounted on the wall already) then went to the title company office with a check for the balance, simple contract and it closed just a few days later.



There were a few issues with the house but I expected that. We really like it.

 

[clifp]

I've bought a bunch of rental properties with cash, pretty much always have included a Schwab statement showing assets well in excess of the offer, or my line of credit unused balance.

 

[meleana]

I was wondering about this because I see people asking about proving income when they are using assets to qualify to rent.

Wasn't sure if a real estate agent would be skeptical of your ability to pay and I am sure many here have downsized and run into it.

Just curious. You don't need to tell me its not the best move as it is not a possibility anyway.

We bought new construction cash. We got a letter from our financial planner attesting to our liquid assets and ability to pay.

 

[Dot57]

Curious why, with these historically low interest rates,
anyone would want to pay cash for a house?

 

[Rambler]

Our last three were purchased cash, and the one before that was built with cash. We are now in the process of having a new home built, also cash. When we buy with cash, we have to submit a bank statement (in some locations) that shows our ability to pay. In others, I’ve been required to get a banker’s letter showing that I had a minimum of more than the anticipated total closing cost of the home on tap and ready.

 

[Rambler]

Curious why, with these historically low interest rates,
anyone would want to pay cash for a house?

When we paid off our first home, we decided that we’d never have a mortgage again for our primary home. That way, we’d always have a roof over our head should my job (at the time) or the markets fail. We’ve contemplated a second home a few times, including the possibility of a mortgage. In this environment, I would be more likely to get a mortgage on a second home than ever before. But, alas, I’m getting old, and I don’t know that I want a second home or vacation home anymore. DW does…time will tell, since we are currently building a new primary home.

 

[MrsHaloFIRE]

We paid cash. Proof of funds submitted with offer. Closed fast and easy.

 

[meleana]

Curious why, with these historically low interest rates,
anyone would want to pay cash for a house?

We haven’t had a mortgage for like well over 20 +
years. At retirement and in our mid sixties we weren’t going to start over with one now that we downsized and moved out of state.

 

[teejayevans]

Curious why, with these historically low interest rates,
anyone would want to pay cash for a house?

Because that’s the only way seller would do business. My condo went on sale Friday and I made an offer on Sunday, they verbally accepted but then got a cash offer on Monday morning for above the list price. Since they verbally accepted, they would stand by it if I did a cash deal and up my down payment, so I did.
I looked at a few houses before this that sold above listed price and were cash. It’s just nuts out there. I don’t know why the sellers care, but they do.