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I just bought a home for cash in California and didn't pay anything at all in any extra costs, except $300 for home inspection (which is optional in California anyway). No closing cost, no fees, no prorated taxes, and seller even agreed to buy a Home Warranty (the home is 8 years old) and forward taxes for a quarter.
I guess it all depends on the market. Right now it's buyers market period. First I negotiated 7% lower price, then seller agreed to pay for all closing cost, all agent fees, prorated taxed AND taxes for another quarter (paying for RE taxes while I own a home for a quarter!), and for home warranty too. It took some negotiating though (about 2 weeks back and forth) but was worth it.
This was REO - so if you're buying an REO and have cash to pay, you may be in for a treat.
All these things are important - most people who never bought for cash don't understand that EVERY DOLLAR COUNTS. When you pay with your own money, you tend to want to get the best home you can - I got one of the nicest homes in a great area. Because you probably will need (or want) to do some repairs and/or upgrades, you'll need cash. You'll need cash for moving, for taxes, for bills, for dinner (unless you plan to live on water and carrots). These fees and costs quickly add up, and you're not in a position to pro-rate those to 30 or 40 years in a mortgage - you need to PAY TODAY, or you lose all benefits of cash buying (such as low closing costs, lower home insurance you can pay monthly, no mortgage etc).
So I would advise any cash buyer to drive a hard bargain, because they can. These days (I've seen it, I shopped for 5 months!), houses fall out of escrow all the time and quite a lot too (from what I've seen in CA)! Because people can't get a loan, because they lose a job, or they or family gets sick, and because lots of people just window shop because they want to buy but are not sure if they can, so fear prevails in the end...
Lots of people presume that only people with millions buy for cash. I personally saved for 15 years, and once I did it, and after a few home improvements, I was essentially broke (which is fine if you don't have a mortgage and have a stable job w/health insurance).
However word of caution for savers: most of my money was made long ago, when economy was going much better. If I had to build the same cash stash now (the way my salary is now which is much lower in real terms than 10 years ago), it would probably take me beyond my grave - i.e. it wouldn't happen, plus I have a family now, so basically all money gets spent every month, virtually nothing left... So if you can afford to buy home for cash now, my suggestion is to do it, as times may move towards where cash loses value (long term due to dollar devaluation or inflation or both) and you may not be able to do it ever again.
Title insurance..I am paying cash. Seller has lived there 5 years, has a morgage. This was the sellers homeplace/parents home. As a buyer, is this my $. and trust the previous title search?
Title insurance..I am paying cash. Seller has lived there 5 years, has a morgage. This was the sellers homeplace/parents home. As a buyer, is this my $. and trust the previous title search?
Protect your cash!
Do a title search and pay for it.
Buy title insurance to protect your investment. That is what a bank would have you do: pay for title insurance to protect their investment.
Why would you do less for yourself?
Can the sellers give you their current title policy so you can have it reissued to get a discount?
All good questions for your closing agent, whether that is a real estate attorney or title company.
Closing agent is the sellers bank.I am working with both the seller and the bank.
The seller is having his bank/lawyer complete the deed preparation, deed search and bill of sale, so when the check is ready all that is taken care of for me. This is different from the title insurance? The seller spoke of completeing the transfer stamp which I assume is his cost.
Mike J..when you speak of current title policy,is that the same as the title deed status,as held in his name? sorry for the stupid questions,The bank and seller and myself will be talking soon.
Mike J..when you speak of current title policy,is that the same as the title deed status,as held in his name? sorry for the stupid questions,The bank and seller and myself will be talking soon.
" It is meant to protect an owner's or a lender's financial interest in real property against loss due to title defects, liens or other matters. It will defend against a lawsuit attacking the title as it is insured, or reimburse the insured for the actual monetary loss incurred, up to the dollar amount of insurance provided by the policy."
Hopefully we will be selling our home and downsizing enough to pay cash
and have no mortgage. How many of the closing costs are releted to the mortgage??? I hope we can avoid alot of fees.
You can avoid a LOT of fees (origination fees, applications fees... luckily I didn't have any of those)... Mine was very simple, Closing Attorney (for title search/insurance) ~600, Home Inspection (You DEFINITELY want this one) ~300-500, Termite Inspection ~100, and Recording Fees ~30... I might suggest that the owners pay all the closing costs + prorated portion of property taxes as well as realtor commissions and repair (if needed) cause that's what I did... Perhaps the one thing that you will save the most...NO INTEREST!!! That's like hundreds of thousands of dollars saved... GOOD JOB!
what are the closing cost on a Va foreclosed purchase if I pay all cash
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