In this low inventory housing market, more buyers started to put Contingency-free cash offers in order to stand out among competitions. Here are the top three things seller must know before accepting an all-cash offer with no loan contingency, no appraisal contingency, and no inspection contingency.
- Where are buyers’ funds: An all-cash offer with no financing contingency is a good deal only if the buyers actually have liquid funds to close. Make sure you verify this as a condition of accepting the offer. Always ask buyers to provide proof of funds. They could be bank statements, investment account statements, etc. If buyers have all their funds in stock, make sure to discount it by 70% to cushion for the market drops. Verify the proof of funds before you accept the offer.
- Require buyer to put deposit in escrow account within three days of offer acceptance. For cash buyer, you could ask more than the standard 3%. Also, if you do not see the deposit check in escrow account within three days of acceptance, do not hesitate to ask buyer to perform immediately.
- Be aware of buyers who make all-cash offer but intend to close the deal with mortgage. If a buyer put an all cash offer but asks for a long close of escrow time, ask why. A cash offer can be closed in as few as seven day.
