Tips & Advice
Which Option is Best for You?
What fits best for you and your situation? Cash offers and buyers financed with mortgage loans have different strengths and weaknesses. At the end of the day, answering this question comes down to your priorities and comfort level.
If you could have your way, you would probably answer whichever is fastest, safest, easiest, for the highest price. In reality, we often have to find some balance between all of these priorities.
If you had to rank those items in order, 1-4, how would you do it?
Sometimes you need to sell in a hurry, if you took a new job and have to move quickly, or if you have some debt against the home that requires some urgent resolution. Typically, a cash buyer can close faster than a buyer with financing, because there are fewer steps in the process and fewer parties involved. Cash buyers can write a check or wire money, while a buyer with financing may have to submit several rounds of paperwork for bank approval.
You wouldn’t hand a stranger the keys to your house in exchange for a slip of paper that read “I Owe You.” Regardless of which option you choose you should make sure that a secure, third party is verifying the available funds and handling the transmission of those funds. Often this is performed by a title or escrow company. Sometimes it gives us a sense of security to see large institutions like banks and appraisal companies involved in the transaction, so a buyer with financing may be (or at least feel) more secure. Cash buyers can also provide documents from their banks or other institutions showing proof of funds.
It is almost always easier to deal with a cash offer than a buyer with financing because as a seller you are not working to satisfy a buyer and their bank. Sure, there will be exceptions, a cash buyer could have a lot of demands or a difficult personality and prove to be harder to deal with or drag things out. In general, having fewer people involved simplifies transactions and makes the process easier.
Again, making broad statements, many cash buyers will offer less, because they can close quickly and keep things simpler. However, if your home needs significant repairs or renovations, a cash offer may mean more money for you and less risk, because the buyer is assuming the workload for repairs and renovations.
Of course, you want to sell your house for the highest price, in the easiest, fastest, and most secure transaction possible. In the end, there will probably be tradeoffs among all of these, and you need to determine how you would rank these in order of priority for yourself.
Reading is great, but it doesn’t always answer all of our questions. Sometimes you need a conversation partner – someone to bounce off of with your ideas and questions. We can do that too; we’re a phone call away.
