Home Buying in Coral Way>Question Details

Gretta, Home Buyer in Miami, FL

What does Cash Only Offers mean?

Asked by Gretta, Miami, FL Sun Aug 2, 2009

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the reason for the "cash only" stipulation Gretta is that there are many properties that banks will currently not finance. If they are in disrepair or if they are condominiums with high levels of default are two of the most common reasons an owner would require offers to be cash only. They know that a buyer depending on financing will likely not be able to get a loan. Open or unpermitted work is another reason a bank may not finance that particular property. Those interested in purchasing cash only properties must either have the cash in hand or use a private lender who will pay cash (often referred to as hard money). In either event, normal contingencies such as appraisal may not be allowed and if a buyer choose to use a private lender and they back out, their deposit could be at risk. It is best to really stay clear of these properties unless you are really and truly a cash buyer.
4 votes Thank Flag Link Sun Aug 2, 2009
Conventional rehab loans and 203k loans exist for the express purpose of correcting defects in homes. Open permits are no barrier to getting these loans, because you simply re-open the permits or get new ones. Everything from old roofs, broken windows, old floors, old foundations, cracked walls, peeling paint, mildew and mold are ordinary problems that can easily be repaired or replaced with a rehab loan, either conventional or FHA. In CA there's a new law that prohibits investors from buying houses with cash until the general public has had a chance to buy them with loans. I've been approved many times by banks such as B of A, Well Fargo and others for these loans for major fixers, with or without open permits.
Flag Thu Jun 6, 2013
YOU CAN ONLY BUY CASH, the property for whatever reason (or Seller) is NOT entertaining any financed offers.
0 votes Thank Flag Link Tue Oct 5, 2010
Gretta,

Very simply put - Most banks will not lend money to finance a house that is a cash only deal. Generally speaking, either the home is not in the best shape or the community does not meet certain guidelines.
Web Reference: http://www.olmedohomes.com
0 votes Thank Flag Link Tue Nov 24, 2009
Hello Greta: It has to do with the property, some institutions will not finance certain buildings or properties for difrent resons, such as: 1) To many delinquencies 2) Not an aproved FHA building 3) Association is bankrupt. Give me a call so we can expand on the subject
Ian A. North
305 467 1881
0 votes Thank Flag Link Mon Aug 3, 2009
Gretta,
I agree with all of the other comments, there are many good homes on the market ,i'm shure you can find another home that's not "cash only" .
Let me know if i can help you find it.
Web Reference: http://www.rosiemorot.com
0 votes Thank Flag Link Mon Aug 3, 2009
I would also worry they are trying to sell it for a price that it wouldnt appraise for. A 203k should work on it and if they dont even want that I would look at what it is really worth.

Dont want to overpay and find yourself in red.
0 votes Thank Flag Link Sun Aug 2, 2009
Hi Gretta,

I agree with the answer below that often when a property is listed with the phrase "cash only," it means it needs a lot of work. If however, you are not afraid of doing the work in order to get a great deal, you can still sometimes purchase these. You need to find out from the listing agent if a rehab loan would be acceptable. Sometimes they say yes, even though they put "cash only." Then you need to get pre-approved for an FHA 203k or 203k streamline loan.

If you would like contact information for lenders who can do these, or if you want to know more about them, please get in touch. Good luck!

Diane Loveridge
Majestic Properties
(786) 210-3449
dloveridge@majesticproperties.com
0 votes Thank Flag Link Sun Aug 2, 2009
The seller is only accepting offers from buyers who will pay cash - no banks or mortgages involved.
0 votes Thank Flag Link Sun Aug 2, 2009
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