SHOULD YOU ACCEPT A CASH OFFER ON YOUR HOME?

Homeowners have several options today to get their home sold. One can sell their home on their own, the traditional route of using a Real Estate Professional, or the myriad of “Cash Offers”.  Although a Cash Offer sounds great, a cash offer can mean very different things and give you very different results from what one would expect.

A cash offer is when a buyer offers to pay for your home in full without using any financing from a bank or other lender. Cash buyers are usually investors, flippers, or people who have sold their previous home and have enough money to buy another one.

Faster closing: A cash offer can close in as little as two weeks, compared to an average of 45 days for a conventional loan. This can be helpful if you need to sell quickly due to divorce, relocation, inheritance, or financial hardship.

Fewer contingencies: This means that the buyer will not back out of the deal if the home inspection reveals some issues or if the appraisal comes in lower than expected.

Less hassle: You don't have to deal with lenders, appraisers, inspectors, agents, or title companies. You also don't have to make any repairs or upgrades to your home before selling it. 

More certainty: A cash offer can give you more peace of mind that the sale will go through without any surprises or delays due to financing.

But remember, financing is only one piece of an offer and other “risks” can and typically are incorporated into any offer

Lower price: Cash buyers often look for bargains and expect discounts in exchange for their convenience and speed. Depending on how much lower the offer is compared to your asking price and market value, you may end up leaving money on the table by accepting it.

Scams: A cash offer may also come with some risks of fraud or scams. Some unscrupulous buyers may try to take advantage of sellers who are desperate or uninformed by offering fake cashier's checks, asking for upfront fees, or changing the terms of the deal at closing.

To make an informed decision, you should compare the cash offer against your home's fair market value, review the terms of the deal for contingencies, and consider if you're comfortable with the buyer's reputation and motivation. Your Real Estate Trusted Home Advisor such as the Petersen Partners Real Estate team can help you evaluate what options are best for you!