Everyone wants to get a good house. But good houses are hard to land because they attract competition. Plus, sellers receive many bids—meaning they can afford to be choosy.
You need a solid plan to ensure sellers look your way. Here’s the thing: An all-cash offer is enough to make you stand out. These offers are irresistible to home sellers, and they almost always win in competitive bids.
As an aspiring homebuyer, you should aim for such offers to gain the upper hand. But what if you don’t have cash? It really doesn’t matter as long as you work with a cash offer mortgage company.
So, why are buy with cash offers better? How do "cash mortgage" companies help? Let’s consider these two questions.
How Cash Offer Companies Help
Buying a home in a competitive neighborhood puts the seller at an advantage and the buyer at a disadvantage. It can be frustrating to watch your dream house be sold to another buyer simply because you couldn’t afford to remove the contingencies.
Some home sellers will be straight with you by stating they’re not accepting contingent offers. Traditional mortgage firms prove to be less of an option since the financing contingency will still be an issue. So, what should you do?
Cash mortgage firms have stepped in to help many buyers trapped in such situations. With a cash offer mortgage firm, you can make a cash offer without having liquid cash.
These firms include Orchard, UpEquity, and Homeward, among others. They assist you with buying a new house by giving a guarantee to make an all-cash payment to the seller. Priority is given in securing the house, and then later, a mortgage is arranged between you and the firm.
If you want to sell your old house to buy a new one, these firms will also help you buy a new home before selling the current home. Then later, you can sell your old house for full price without having to rush the process.
By removing the home sale and financing contingencies, these firms make home buying a simple and hassle-free process. This strategy is especially helpful for first-time homebuyers who lack experience in the real estate market.
Why Cash Offers Are Better
These are the four reasons why cash offers are better in real estate:
- Fewer contingencies – when it comes to home buying, the truth is that cash offers often prevail over offers with financing contingencies. These contingencies create uncertainties. It’s not clear if the buyer will get financing. As a result, a seller is more likely to go for a cash offer as it doesn’t have those uncertainties.
- More negotiating power – cash offers give the buyer considerable bargaining power. This means quick cash in the seller’s pocket. For this reason, some sellers are willing to accept a lower cash offer than a higher offer tied up with many contingencies.
- Faster closing – in a traditional conventional mortgage, closing time takes approximately 47 days. But in a cash offer program, closing time takes 21 days or less. This means you’ll be moving to your new house sooner.
- Smooth process. Buying a home with so many contingencies and uncertainties can be a stressful process for both parties. At the end of the process, you’ll be worn out and sometimes frustrated. A cash offer program helps you to avoid all that stress. As the buyer with cash, you’ll have more control of the process.
Weigh Your Options – Choose The Best
When buying a home, financing options tend to take the first consideration. Admittedly, not many people can afford to pay full cash without a lender’s support. Even so, not all lenders will help to remove the financing contingency.
It’s crucial to compare the financing options available and go with the best. A cash offer program puts you in the same position as any other buyer with full cash. This is what sellers are looking for, and it’s what you need to land your dream home quickly.
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