Are you thinking about purchasing a home in Austin, Texas, using cash? If so, you might be wondering what it means when you offer cash for a house exactly. How is it different from a traditional offer? Does it come with any complications? 

In this post, Amy and Dallas Seely along with our expert real estate team at The Seely Group will discuss what it means when you offer cash for a house and share several pros and cons of cash offers.

Key Takeaways

• As a buyer, offering cash on a house means you pay for a property using your own cash, rather than financing from a third-party lender. Since you don’t need to use a lender, this allows the entire buying process to move forward much faster.
• Paying with cash can speed up the closing process, shortening it to as fast as a week compared to the average of 30 to 60 days.
• Cash offers give you the upper hand in negotiations because of how appealing they are to sellers. Sellers may be more likely to make concessions in exchange for the speed, convenience, and certainty that comes with cash.

What Does It Mean When You Offer Cash for a House?

As a buyer, offering cash on a house means you pay for a property using your own cash, rather than financing from a third-party lender. Since you don’t need to use a lender, this allows the entire buying process to move forward much faster. 

Not using a lender means you can skip the lengthy mortgage underwriting process, where the lender verifies your income, debt, and credit score. You’ll also be able to bypass lender requirements like an appraisal, title search, and title insurance– though you should still consider doing these steps on your own. 

Overall, paying with cash can speed up the closing process, shortening it to as fast as a week compared to the average of 30 to 60 days.

Pros and Cons of Making a Cash Offer

Benefits of Cash Offers

• Streamline Your Purchase: Since you don’t need a lender, the entire process is much faster and simpler. You won’t need to fill out a mortgage application or all the other forms that come with third-party financing.
• Gain a Stronger Negotiating Position: Cash offers give you the upper hand in negotiations because of how appealing they are to sellers. Sellers may be more likely to make concessions in exchange for the speed, convenience, and certainty that comes with cash.
• Avoid Paying Interest: Since you don’t have a mortgage, you won’t have to pay interest on the home– you’ll own it outright and in full. While you’ll be paying significantly more upfront, you’ll at least be able to save on interest payments in the long run.
• Get Equity Immediately: Buying the home outright means you’ll gain 100% of its equity at once. This can give you a greater sense of ownership and financial stability. 
• Pay a Lower Price: Cash offers are typically lower than financed offers. Sellers are usually willing to accept a lower amount in exchange for the speed and convenience of cash offers.

Drawbacks of Cash Offers

• Takes a Large Amount of Cash: It goes without saying that buying a home with cash is expensive. Without proper budgeting, it can decrease your liquidity, since your cash is going into a non-liquid asset. You’ll need to plan carefully and make sure you have enough cash left over for your day-to-day living expenses, not to mention the other costs associated with homeownership, like repairs, HOA fees, and property taxes.
• No Mortgage Tax Deductions: Mortgage interest payments are tax deductible, which can help you save some money on your tax return. But without a mortgage, you won’t be able to claim this deduction.

Buy a Home for Cash in Austin, Texas with Amy and Dallas Seely

Making a successful cash offer starts with having an experienced realtor on your side. At The Seely Group, Amy and Dallas Seely and our entire team of real estate experts help over 300 families in the Austin area every year. And according to Realogy, we’re in the top 0.1% of realtors nationwide.

Amy Seely is Austin’s top ASL Realtor and proud CODA!

We’ve handled hundreds of cash offers throughout our career, and can easily help you find the home of your dreams in the Central Texas area.

To learn more about working with us to buy your next home with cash, call 512.943.2572 or send a message to [javascript protected email address]. You can also fill out the form on this page.

To Discuss Your Home Sale or Purchase, Call or Text Today and Start Packing!