I am planning on Buying a House in Florida, Will Pay for it from my Savings, Full asking Price, Cash!

Asked by Mrs Acala, 32114 Thu Feb 19, 2009

Few Questions:
1 Can you tell me the benefit of buying a home and paying the amount in full with own my cash?
(No loans).

2- I'm planning to buy the house for my daughter, Can I do the purchase and have her sign all papers at closing or just have her do the purchase herself. (she's 22-student)

3-Would I have to prove where the money is coming from? Just wondering!

4- And also, Would she qualify for the 2009 $8000 tax brake?


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Mary Klein, , Ormond Beach, FL
Mon Aug 10, 2009
Dear Mrs. Acala,

It sounds as if your daughter will be a student in the area, and that you will be providing the funds for the house. First, this is a great time to take advantage of purchasing in our area: we have a healthy inventory of homes and interest rates are very low. (1) The benefit of paying CASH is that you will be able to purchase a foreclosure, thus maximizing your investment; (2) The second benefit of CASH is simplification of the process and purchase; and, (3) As long as the title and subsequent paperwork are held and filed in your daughter's name ONLY, she should be eligible for the tax credit. The total credit would be based on federal guidelines and expires on Nov. 30th. Please speak with an accountant to look at your situation and clarify eligibility prior to counting on the credit.

Call or email me with any additional questions, I'd be happy to help.

Mary Klein, REALTOR, Adams Cameron & Co.
(cell) 386-383-5980
1 vote
Phil Hanner…, Agent, Port Orange, FL
Sun Mar 1, 2009
1. I get significant discounts for my cash buyers. I focus on foreclosures and motivated sellers. This means savings for you.

2. I can give you solid advice on purchasing property for an adult child.

3. Depends on the seller.

4. Depends on how you decide to title the property.
1 vote
Christy Vela…, Agent, Daytona Beach, FL
Thu Nov 1, 2012
Currently buyers are very happy with cash buyers. It is typically a quicker close since there is no "qualifying for a mortgage" on your part.
Part 2 of your question is a little more complicated due to the potential tax ramifications. You should consult a Real Estate Attorney & for Part 3 of your question: whomever does the closing for you (title company/Real Estate Attorney), will tell you if there is a form you will need to complete.
I believe the easiest way for you to complete this is to purchase the home yourself and add her to the title. But again, you should definitely contact an attorney.
0 votes
Donna Stewart, , Sarasota, FL
Wed Aug 12, 2009
Cash buyers have an advantage now. Banks are very leery about parting with their new found federal funding and loaning money seems to be a problem for them. It is difficult, though not impossible, to get a loan unless you have impeccable credit, and can meet all their requirements.

If you are doing a cash purchase there probably would be no problem titling the property in your daughter's name. However, ALWAYS check with an attorney with any questions you have regarding signing of papers. Realtors are not legally qualified to give legal advice. That is not our expertise.

Ask the Title Company.

If a buyer has not owned a property in the past 3 years, that person should qualifiy for the first time tax break.
However, if you are buying the property for a daughter and are a present owner, I would suggest again you get consul from a good tax consultant.
0 votes
Chuck Kabis,…, Other Pro, Naples, FL
Wed Aug 12, 2009
1. lower debt, ease on cash flow/income , good for net rental income.., F&C asset.
2. your money...you sign. If you want her on the Deed as an owner, then give her a Q.C. deed and record it
Even tho you will pay cash, close the transaction with a title company, and be sure you get owners title insurance.
3. I presume you won't be bringing the money to closing in a brown paper bag...If you have it in an account, and wire it to the title company, you should be fine.
4. only 1st time buyers..if you buy...she isn't the buyer. If you GIVE her the money...and she is the buyer, the purchase contract is in her name, deed in her name, then she will likely qualify..but get legal and financial advice on the issue..as well as tax advice on giving her the money.

If you are interested...I have a new never lived in 3 bdrm, 3.5 bath, 2 car attached garage, exquisit Coach Home in Fiddlers creek Golf and CC, naples, Florida I own, for sale now, reduced to mid $600,000.00. if you want more info contact me directly at chuckkabis@gmail.com or call 239-298-3090
0 votes
Thomas Manni…, , 34135
Wed Aug 12, 2009
Please let me know what area you are interested in buying, if in my area Naples, Bonita Springs I would be happy to help you if outside the area I can refer you to a qualified Real Estate Agent.
Tom Mannion
0 votes
Bill McKinnon, Home Buyer, Lake Helen, FL
Wed Aug 12, 2009
I have a nice house she would like in Lake Helen. Not far from the beach or Orlando. Stetson University is 6 miles away. Has above ground pool also
0 votes
Lisa Hill, , Port Orange, FL
Tue Feb 24, 2009
Mrs. Acala, In answer to your first question, it's highly unlikely that you should have to pay the full price, regardless of your financial status. Paying cash gives you the upper hand. In answer to your 2nd question, you can have your REALTOR write your contract to allow you to add another name to the title at closing, or you can have both names added to the contract, right from the start. For number 3, no you do not have to prove where you got the money. And as for number 4, with so many changes lately, I'd ask a real estate attorney or perhaps the title company could help you with that information.

If you need a REALTOR to help you buy a home, I'd love to help. I'm a Daytona Beach native, and top producer with Adams Cameron & Co., REALTORS. My web site is included with this comment.

Good luck!
0 votes
Josh M. Boggs, Agent, San Antonio, TX
Thu Feb 19, 2009
Good afternoon Mrs. Acala,

You pose all great questions and I will try to answer to the extent of my professional abilities, however I am not an expert at tax law nor an attorney. Also, there is much more that can be discussed here on the topics, but for time sake I will keep it relatively short.

1.) In my opinion, the only benefits that you can have by paying 100% cash is more negotiating power on purchase, specialized personal situations require this (low monthly income) and possibly some tax benefits. Me personally, I would never pay 100% cash for a house as I always tend to look at the best investment possible or more importantly Return on Investment (ROI). Let’s say this house cost you $100k, instead of locking up $100k into one home; how about using it to purchase 5 rental homes or even 3 rental homes while maintaining cash reserves at 20% down. Then put tenants into them and draw into them not only positive cash flow, but future equity and now you are diversifying your investment by limiting your risk and improving ROI.
2.) This is where a GREAT CPA will need to come to play. If you just gift your daughter the money; you may be liable for a gift tax or other tax implications. However, if you purchase the home under a partnership or other legal entity, then you may avoid such taxes, but still… a CPA will be needed here.
3.) I’ve not seen any cash deals requesting proof of where the funds are coming from. You have a proof of funds letter in your daughter’s name and account; the owner shouldn’t be displeased and will be willing to move forward.
4.) The tax incentive would almost be a resounding NO! Her income would have to be considered and then the cash sale most certainly will raise a few red flags as to why she is requesting a tax credit. However, to the best of my current knowledge this tax credit is not subject to ONLY those obtaining a mortgage, so I would still refer to a CPA that will have the most recent information.
Hope that helps just a bit.

Best of luck on your success.

God Bless,
Web Reference:  http://www.eXposedHomes.com
0 votes
Skip Stamper, Agent, Ormond Beach, FL
Thu Feb 19, 2009
1) Bargain power, The money is not earning much these days sitting in the bank.
2) You can quit claim the home over to her once purchased.
3) The closing agent will get SS # and positive ID on or before closing. The transaction is reported to the IRS.
4) If she purchases the home she may qualify for the tax break but, the cash sale would also alert the IRS as to the amount of income she was given for the purchase which would be taxable to her. If she is a student her taxable income may be less. Consult with an acct. or tax attorney.

5) I am a naitive of Daytona and happy to assist in any way that I can
0 votes
John Bennett, Agent, Orlando, FL
Thu Feb 19, 2009
Hi, Your answer needs an Accountant. Suggest you go to a CPA. here are some of the issues

Would the be a gift, then you would have to pay a gift tax on the gift.

Would you buy and let her get a gift each year (up to the free amount you can gift each year)

if you get a loan you maybe able to deduct the interest against income.

Several ways you can do this but you will need a CPA to advise you and or a Lawyer. Sometime you can get a Lawyer that is a CPA as well. I have one (he is also a MBA) should you need.


0 votes
Kandi Schromm, Agent, Ormond Beach, FL
Thu Feb 19, 2009
Hello Mrs. Acala.
One benefit of purchasing a home with cash is that the seller does not have to take the home off the market and wonder if your financing will come through or not. Generally this gives the buyer more negotiating strength in the purchase. Another benefit is that you obviously do not have to pay interest on the mortgage over 15 - 30 years, making the net purchase price to you even more attractive.

If your daughter has not purchased a home in the last 3 years, she would qualify for the $8000 first time home buyer tax break, if she is the purchaser of the home.

The title company, an accountant and/or legal counsel are the best ones to ask about the benefits of holding title in your daughter's name or your name. I would be happy to refer you to those professionals locally if you would like.

If your daughter is going to be a student at Embry Riddle or Daytona State College, there are many homes close to those facilities. I have several listings in Indigo Lakes (and live there myself) which would be fine homes for a college student.

Please let me know if I may be of assistance to you.
Best of Luck!
Kandi Schromm
Beach & Luxury Realty
0 votes
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