Benefits of buying home with cash

Are you looking into buying a home? Have you considered the option of buying a home with cash?

Maybe you were like me, and the first time you heard about buying a home with cash, it seemed like a farfetched idea only for the rich.

I was a young adult when a friend talked about the benefits of buying a home with cash. At the time, I thought the idea was crazy. I had only heard of people buying a home by taking on debt with a mortgage. In fact, at the time lenders were allowing people to buy homes with no money down at all.

However, this crazy notion took root in my thoughts.  I began to see how paying for a home with cash might be worth the effort of waiting and saving. I also learned that it doesn’t have to be a benefit for the rich, but can be an option for many other people.

Buying a home with cash isn’t an option for all people. As you make your decision, understanding the benefits can help you feel confident about the decision you make.

Here are 3 benefits to buying a home with cash:

  1. Cash Cuts Cost

One huge cost cutting benefit that buying a home with cash allows is the ability to eliminate the need to pay interest on the loan. The amount of money saved over the common thirty year mortgage is incredible.

It also will help to cut costs on some closing costs. For example, when you buy a home with cash, you will not be required by the lender to have an appraisal done. Therefore, you will not have to pay for one.

  1. Cash Helps Win Bidding Wars

You may have heard the expression, “Cash is King.” When you have cash, it gives you more negotiation power and can often get you a better deal. Having all cash helps to make your offer more attractive to sellers.

According to Peter Grabel, manager director, ML luxury Mortgage Corp in Stamford, Connecticut, “In a competitive market, a seller is likely to take a cash offer over other offers because they don’t have to worry about a buyer backing out due to financing being denied.”

  1. Credit Doesn’t Matter

If you want to buy a home, but you don’t have good enough credit, paying for a home with cash will help you jump that hurdle. You do not need to go to a lender to ask for money, and your credit would not need to be checked.

Mortgage Benefits

On the other hand, buying a home with cash doesn’t always have to be the best option. A mortgage can make sense for a lot of reasons even if a buyer has the money to buy a home with cash. Buying a home with cash can tie up a lot of money. A buyer may choose to take a mortgage because they prefer to have liquid cash.

Wrapping Up

The main goal is that you want to make the best investment and get the biggest bang for your buck. When looking 30 years into the future, being able to buy a home with cash can make huge financial sense.

If you are considering buying a home, we would love to help. Please call our office today.