In a hot real estate market with would-be home buyers outnumbering sellers, many of those interested in making a purchase will choose to pay cash for their new property. A recent ATTOM Data Solutions study found that one-quarter of home sales last year were to cash buyers. This type of sale can have benefits for both parties in a transaction.
Buyers who are buying a home in cash can save thousands of dollars by waiving closing costs. In addition, they can also avoid interest payments that are associated with mortgages. These benefits can help them save a large amount of money over time.
Some buyers who are able to pay in cash will make the decision for other reasons, too. Those who are looking to save on taxes or who want to keep their finances private can opt for a cash purchase, too.
Another benefit of purchasing a home in cash is that it can be faster than a traditional financed purchase. In fact, according to the ATTOM Data Solutions study, the typical closing time for an all-cash purchase is less than 30 days – compared to the usual 30 to 45 days for a financed sale. This can be especially helpful for those who are relocating or who need to sell their current home quickly. Read more https://www.360homeoffers.com/
As a result, buyers who make all-cash offers may have more bargaining power in negotiations with the seller. They can ask for additional money if other buyers make better offers or put in an escalation clause that gives them an incentive to beat other bidders by a certain amount, up to a ceiling.
A hiccup in securing financing can also make a cash offer more attractive to sellers, says Michelle Doherty, a real estate agent in northern Virginia with RLAH Real Estate. For instance, an appraisal could come back too low for a loan, or a change in the buyer’s financial situation could affect their ability to meet a mortgage payment.
All-cash buyers can also avoid the extra fees and interest payments that are associated with mortgages. In addition, they can avoid local mortgage taxes, which are usually a small part of the total cost of a mortgage.
In addition to these benefits, cash buyers can often find a more suitable property for their needs than they would if they were able to finance the home. For example, if they’re moving to a new area, they might prefer to buy a property that is close to work or other important amenities. The same can be said for a buyer who’s looking to upgrade or expand their space.