Why the banks take a lower cash offer on your West Bloomfield home

Why the banks take a lower cash offer on your West Bloomfield home

 

 

Here is why the bank took a lower cash offer over your offer on the West Bloomfield home.

Cash deals are usually king.  The banks will usually take the cash offer over a mortgage offer.

Banks prefer cash deals for these reasons:

  • cash deals can close within a month.  They close quicker than mortgage deals that take 30 to 60 days..
  • cash deals don’t require an appraisal.  There is no chance that the deal will fall apart because the house didn’t appraise.
  • cash deals don’t have a mortgage.  The deal can’t fall thru because of mortgage problems such as debt ratios, and underwriting issues.
  • cash deals don’t depend on the buyer having a job.  If the buyer loses their job on a mortgage deal the deal is dead.  With cash deals it can still close.
  • cash deals have already proved they have the money.  When you put in a cash offer you must get a proof of funds letter.  The letter comes from your bank and states that you have a certain amount of money in your account.
  • cash deals will be accepted when there are repairs that will need to be completed for a FHA loan, VA loan, or a conventional loan.
  • cash deals don’t have an out. If you don’t close with a cash deal you lose your money.  If you have a mortgage you can get your deposit back if the house doesn’t appraise or if the mortgage doesn’t go through.

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Many times banks will take a lower cash offer over a mortgage offer.  It just depends how big of a difference there is.  I lost a deal on a piece of Livonia real estate on a cash offer.  The list price on the Livonia ranch was $61,000.  My clients bid $81,000.  The bank accepted an offer of $55,000.

That was a $26,000 difference.

I hope this explains why the bank took a lower cash offer on the West Bloomfield real estate you loved.  So if you can afford it,  bid cash.

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The data relating to real estate for sale on this website comes in part from the IDX program of Realcomp. Real estate listings held by brokerage firms other than Keller Williams Realty Commerce Market Center are marked with the IDX logo and detailed information about them includes the name of the listing brokers.


All information deemed reliable but not guaranteed and should be independently verified. All properties are subject to prior sale, change or withdrawal. Neither listing broker(s) nor Keller Williams Realty Commerce Market Center shall be responsible for any typographical errors, misinformation, misprints and shall be held totally harmless. IDX information is provided exclusively for consumers' personal, non-commercial use and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing.