Do Cash Buyers Always Offer Less?
If you’re selling your home, a cash buyer may have contacted you. In comparison to the ‘typical’ home buyer looking to finance the purchase with a mortgage, such buyers or professional companies like ourselves here at Cash Home are in a better position because they have a lot of money in the bank. Because of this, even while there is nearly always a buyer for every property, the offer you receive may not be quite as much as the property is worth in the market.
What Exactly is a Cash Buyer?
Cash buyers are exactly what they sound like. The full price agreed upon by the buyer and seller is paid in full for the property. The buyer will be able to transfer the monies right away, pending any necessary legal checks.
On the other hand, before the lender will advance the cash to a buyer using a mortgage, they must pass through a number of legal and financial hoops. In practice, this could take several months. Accepting an offer from a cash buyer like ourselves will save you valuable time, effort and hassle.
Why Do Owners Accept Cash Offers?
Many homeowners are prepared to accept a bit less money when selling to cash purchasers for a number of reasons. First off, a cash transaction has a lower chance of failing than a mortgage sale.
The fact that 1 in 3 home transactions in the UK fail may not come as a surprise. Mortgage-dependent buyers might not fulfill all of the requirements set forth by their lenders. In this situation, their mortgage lender can deny their application, which would force them to abandon the process. In other instances, the surveyor hired by the mortgage company may undervalue the property and the mortgage company might lower the amount they are willing to lend.
These sales also happen more quickly. This is because cash purchasers won’t have to wait until they’ve sold another property in order to afford yours since they already have the money available.
Finally, firms that pay cash for properties, like Cash Home, pay all legal costs. There won’t be any estate agency fees because it’s a straight sale.
Why Do Buyers Often Make Lower Cash Offers?
It’s not always the case that a cash buyer will try to make you a lower offer than you had anticipated. However, if a buyer has immediate access to money rather than depending on a mortgage, they are more likely to do so.
There are several potential causes for this. First, the buyer is probably aware that many homeowners prefer a cash transaction than one that necessitates a mortgage.
Another important factor is that many purchasers will be eager to hold on to as much as they can for any improvements or unforeseen costs because they only have access to a limited amount of money. Only 10% (or even less) of the total sale price is required as a deposit from mortgage buyers. This implies that they are able to borrow far more money than they actually have ‘in hand’.
Should You Accept a Lower Cash Offer?
At first sight, a bid that is below your asking price might not appear all that attractive. However, a lot will depend on the goals you set for yourself.
For instance, it might make sense to hold out and increase the price you get if you’re not in a rush and your estate agent has thoroughly verified the buyer. However, we know that often people need a quick sale for their property and want cash quickly.
Here at Cash Home, we guarantee a fair and high cash price offer on your property that can’t be bettered.