Then show me the money! If you are going to put in a cash offer for a property, you will have to prove you have the money to back up the offer!
Here in Litchfield County, CT we do often see cash offers. I have heard some agents say they won't ask their clients for proof of funds. They say the client will get offended, will refuse, it is not necessary, etc. Me? I disagree with that train of thought. I don't know about anyone else, but I have no idea how much cash someone has available because of who they are, what they drive, how they dress. And if that same person is selling a home, they would want to know the person putting that cash offer on their house can put their money where their mouth is!
Cash offers can be great, the time from offer to close can be greatly shortened. There will be no surprises from a lender at the last minute. But because there are no lenders involved there is no third party to appraise the house. Great for the seller, some buyers might consider that risky. A buyer does have a right to put an appraisal contingency in the offer, if the house doesn't appraise they don't have to go through with the purchase. (Buyer pays for the appraisal.) If a buyer is comfortable with the offer price, they don't have to do that. I recommend to cash buyers that they have an appraisal done in most cases.
Cash offers often turn into mortgages without the seller, the agents, the attorneys knowing. That can be a big problem. If you are not in contract yet, you have changed the terms of the original agreed upon offer which means... you may have nothing. The seller accepted the offer based on one set of criteria, and now it is a whole different game. If you are now under contract it can be a real problem. Real estate contracts, by nature, are bilateral, having consent of both parties. Making unilateral changes just doesn't work.
So before you tell your agent to put in a cash offer on a house in Litchfield County, CT, get all your ducks in a row. Make sure that is what you really want to do. Back up the offer with the proof that you have the available funds! And if you are a seller, don't get all excited when someone waves cash in front of your face. I have learned, more often than not, things can certainly change, without warning.
Cash offers in real estate, they can and do work. As long as the buyer shows, up front, they have the available funds to purchase the property at the agreed upon price. And as long as the terms aren't changed mid stream by the buyer suddenly deciding they want to get a mortgage after all.
Andrea Swiedler, Realtor, Southern Litchfield County Real Estate
2017 President, Greater New Milford Board of Realtors
2017 Connecticut Magazine 5 Star Realtor
Coldwell Banker Residential Brokerage
Litchfield County Regional Office,375 Danbury Rd, New Milford, CT 06776
© Andrea Swiedler 2009 - 2017
Always do right. This will gratify some people and astonish the rest. - Mark Twain