Cash buyers in real estate have a reputation for snatching up homes out from under credit buyers. But if you’ll be financing your home purchase mostly with credit, you aren’t necessarily out of the game.
If you’ve lost out already to cash buyers, you’re probably wondering what you can do to potentially level the playing field. A cash offer on a house is undoubtedly hard to beat. Offering cash for a house is usually at the top of a home seller’s wish list.
We will be going over a few ways to successfully compete against a cash buyer.
Offer Over The Asking Price
Be prepared to make an offer that is higher than the asking price.
Spending more money to beat a cash offer sounds crazy. But cash buyers nearly always expect a discount from the seller simply because they’re offering cash. As a result, the cash buyer will often make a lower offer. To increase your chances, top the cash offer. If you plan to live in the house for years, and it’s the home of your dreams, paying a bit extra may well be worth it.
Pre-Order An Appraisal
Smaller banks, direct lenders, or mortgage brokers can line up an appraisal in advance, though this can be more difficult to arrange with a bigger lender. At the time your offer is written, tell the seller the appraisal has already been ordered.
Inspect Right Away
Along with the quick appraisal and loan contingencies, get your inspector in and out. Spending a few hundred dollars to get the inspections done within days of having your offer accepted shows the seller you are serious.
Waive The Appraisal or Home Inspection
You’ll take a big worry off the seller’s plate by waiving the inspection. Is it risky? Most definitely, especially with homes that show wear and tear. Unfortunately, it has become commonplace in the scorching hot real estate markets across the country. It is a significant tool to beat other offers, including those that are cash.
Crafting a winning offer and boosting your confidence while house hunting ultimately boils down to being able to make the best offer. Gain a competitive advantage in this seller’s market by having full proof of funds in the bank and being able to move quickly, just like those other all-cash buyers who have been snapping up homes from under everyone’s noses.