Hypothetical question- if you were selling your house...

Would an offer that comes in as an all-cash deal be very attractive to you as the seller?

Let's say couple 1 is willing to pay 10k for a house but will need a mortgage.

Couple 2 will pay 7k but it will be an all-cash deal.

Who would you choose?

Re: Hypothetical question- if you were selling your house...

I don't know the exact answer for this, but as long as the couple is approved for a mortgage I wouldn't care where the money was coming from.

Hypothetical question- if you were selling your house...

The benefit of an all cash deal is that you don't have to wait to get a mortgage approval/appraisal, etc. So, it depends on how confident the seller is that it will appraise and that the mortgage co will give the mortgage, and also on how quickly they need to sell.

Re: Hypothetical question- if you were selling your house...

I would thing in the overall picture the cash buyer comes with less risk. They can't get turned down for a mortgage, if they have all the cash I would guess they arent in the position of having to sell a previous home, the timeframe might be faster bc they dont have to deal with all the bank stuff, and there isnt as much issue with appraisal value...


ETA: different situation but when we sold our house we had 2 offers, one was for 5k more than the other, but the lower offer was putting more down. We went with the lesser offer bc we felt there was less risk involved and 5K wasnt worth it if the buyers couldnt secure a mortgage or if the house didnt appraise high enough etc....

Message edited 2/18/2014 6:36:23 PM.

Re: Hypothetical question- if you were selling your house...

I would say it depends.

Cash is always attractive because it eliminates a mortgage contingency in the contract and means a fast sale, as others have said. If the seller has concerns about an appraisal or C/O issues or there is concern about the condition of the house being mortgageable, then cash is highly desirable, maybe even required.

But I can also see situations where a seller would choose a buyer who needs a mortgage versus a cash offer. If the seller has emotional attachment to the home... Say it's a senior citizen who lived their for 40 years and raised children there. That seller might prefer to sell to a young family who they feel will enjoy the home the way the seller did, even if that family needs financing, versus an all cash investor who intends to change the house, flip the house, whatever.

Also, cash buyers often expect a discount, and for some sellers (those who have little to no equity, for example, and may be bringing money to the table), would probably take a higher offer over a lower cash offer. As someone else said, the seller's main concern is their proceeds, the amount, not necessarily the source.

Every seller and every situation is different, which is why negotiations can be so unpredictable! As a buyer, all you can do is put your best foot forward at all times!

Re: Hypothetical question- if you were selling your house...

For me, provided the person was approved and the broker checked into their financials and knew they could get the mortgage as a seller I would want the most money.

That said when we got our house there was an offer 20k higher BUT the person had a much lower down payment and was not as qualified as we were so the seller went with us bc we were a sure thing and the other people may have been willing to pay 20k more but she was not confident the mortage/deal would go through...

Re: Hypothetical question- if you were selling your house...

We are listing our house for sale soon and i would literally jump with joy if we had an all cash buyer. All cash to me screams shorter time frame for closing as no bank commitments or involvement is needed.

Re: Hypothetical question- if you were selling your house...

My SIL just went through this and chose the cash buyer.

She said it was very emotional because the one's who needed to be approved, I believe the DH was a survivor of 9-11 and had a baby on the way.

They also were in closing for another house so needed to have their first house off their hands ASAP which is the main reason they chose the cash.