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I knew this was gonna be a funny thread as soon as I saw the title.
OP you're mixing up all different complaints and theories and none of them has anything to do with a cash sale.
e. appraisals, fires, agents, titles, lawyers, comps
a. Did you literally say you'd "like to avoid an appraisal"?
b. You seriously don't know ANYONE who paid cash for their house.?
I did. I saw my condo on a Wed. and made a cash offer on Thurs.
c. I assume you've never actually SOLD a house or you'd understand the beauty of THAT sale.
d. I HIGHLY recommend you chose to be a renter.
I won't comment on many of the post since my last one.
Hypothetical: Cash buyer and it's January. They buy the house and when summer comes the central A/C doesn't work.
Seller or buyer should insist on an inspection before the cash sale?
And if both decline or say not necessary?
a. Yes avoiding the appraisal since that is the seller's cost.
b. No
c. Wrong
d. Tried that and too many issues.
e. So if I had a house for sale and you were offering cash what would you insist on before the transaction is completed IF we have already agreed on price and agreed no appraisal needed and no agent needed and looking at comps. are n/a since we already agree on price.
I won't comment on many of the post since my last one.
Hypothetical: Cash buyer and it's January. They buy the house and when summer comes the central A/C doesn't work.
Seller or buyer should insist on an inspection before the cash sale?
And if both decline or say not necessary?
a. Yes avoiding the appraisal since that is the seller's cost.
b. No
c. Wrong
d. Tried that and too many issues.
e. So if I had a house for sale and you were offering cash what would you insist on before the transaction is completed IF we have already agreed on price and agreed no appraisal needed and no agent needed and looking at comps. are n/a since we already agree on price.
a. Except that it's the buyer who pays for an appraisal when required for financing. If the seller gets an appraisal because they are trying to figure out the right price to sell for, then yes, it's their expense.
b. Anecdote doesn't equal data. Cash sales take place all the time regardless of your lack of personal familiarity
c. I'll accept your word you've sold before, but you still remain very misinformed about the process
d. I'm not surprised
e. A buyer may or may not agree to no appraisal. As a seller, you have no control over that and they would not be asking you to pay. Many cash buyers are experienced with real estate transactions and feel comfortable about whether they are getting a good price but if they want an appraisal to confirm that, you get no say in the matter. I would insist on an inspection, if it's in an HOA, I would insist on access to and a chance to review those docs, you have no right to say no agent, if that isn't changing the price and you'd net the same amount, same thing with a lawyer, you'd need to pay all customary seller paid fees and costs - and since you say you are an experienced seller, you are presumably familiar with what those would be. If I want to hire an agent and/or a lawyer and compensate them directly, you get no say on that.
Do you seriously think that it's customary for buyers to go back after sellers for things that could/should have been covered in an inspection (whether done by a professional or at the very least by the buyer themself) months after closing? This is where your claim that you have bought and sold properties before makes people skeptical.
All previous buys and sells had an inspection to tell the buyer what was wrong or defective. One inspection report was over 25 pages with photos. That particular inspector failed to see, or find two very serious defects. One resulted in a natural gas fire about 3 years after the bank sale and the other was the wrong type of wood for a roof. You don't use wood designed for interior walls to cover the roof.
something that happened 3 years after the fact was the inspector's fault? You don't think something could have happened to the gas line in that 3 years?
And who uses wood for interior walls? They're sheetrock. Or are you attempting to say they used the exterior sheathing OSB also for the roof decking?
At closing, the Buyer is accepting the property in it's current condition, without warranty from the Seller. Unless the Seller knowingly withheld an important issue. And then the Buyer has to PROVE it, which is darn near impossible, unless the Seller told his neighbors about the problem but not the Buyer.
Both the inspection and the appraisal are options for the BUYER to acquire. The buyers responsibility in every way. With a cash transaction, neither are required. They can waive both if they choose. If not, the buyer pays for them.
The only time a seller pays for an inspection is when they know they will need to fix things prior to listing the home. This lets them know what is wrong so they can fix it in advance. Commonly, this method is used when unloading a rental or an inherited home. The majority of owner occupant sellers do not do this because they are aware of the condition of the house.
The only time a seller pays for an appraisal is to help guide them to find market value. This is common for FSBO and uncommon for listings with an agent.
I don't know how sophisticated I am but I have a knack for seeing through the smoke and can do my own work.
I look for value and don't get hung up on things I can easily fix...
The last home I bought had been in escrow but the sale fell through... the reports called for 30k of work with the bulk being a foundation raise... the flower beds were against the building and above the sill plates... also things like no earth quake bracing, ptrv on the water heater, grounded outlets without grounds, etc...
Spent less than $1000 to do all work... simply regraded with wheelbarrows the dirt away from the foundation... installed proper non-grounded outlets, braced the water heater, piped a TPRV to daylight, installed a new garage door opener with safety interlock and safety springs... etc...
Nothing even required a permit and then called for new inspections and all was good...
I really believe not everyone is cut out for home ownership... the sleepless nights and anxiety can be too much for them.
One of my friends was adamant about buying a new home... not someone else's problem... she did buy new and found it had Chinese Drywall and had been in litigation for years...
The owners of my home bought it new in 1922 and lived to a very ripe old age...
OP, your buyer can buy themselves a home warranty if they want to. I think they are a waste of money but a lot of buyers like them. The buyers can pay for a home inspection is they want one.
When you negotiate the price, put into the contract that the property is being sold as-is.
e. So if I had a house for sale and you were offering cash what would you insist on before the transaction is completed IF we have already agreed on price and agreed no appraisal needed and no agent needed and looking at comps. are n/a since we already agree on price.
If you've already agreed on a price, it's really pointless to do an appraisal or to investigate comps. It's too late by then to do any good. And if you've already agreed on a price, get a real estate lawyer to handle the paperwork and do the closing...or have a title company handle the closing, with or without a lawyer if you're comfortable going that route. However, it sounds like you'd be better offer using a lawyer.
I'm sure it's been said but if a buyer has to get a mortgage then they can get denied during the process, appraisal might not come through, people have time to pull out of the deal and if anything like that happens it means the home is tied up off the market for 4-6 weeks where you could miss out on other buyers. If deal falls through for any reason you may end up having to sit on it longer depending on how hot market is and you may never get as good of an offer as the one that fell through. So basically cash sale mitigates a lot of potential risk
These investors who offer cash. Do they realize that a cashed check recevied from a bank on a mortgage is the same as cash? Offering cash does not impress me at all.
Someone in the neighborhood where a home is located is interested to buy the tenant occupied dwelling. Since they live nearby they want it for their parents. They said they could pay cash and would like to tour the home and they were in no hurry, even a few months from now. He and his wife both have good jobs. He has been to over 12 different countries and likes the south and that implies they may have lived in the north USA.
It's also near their church. I think they are legal US citizens. They should be able to get a mortgage with their incomes and with the cash to pay 20% down. He started the conversation and I said well the asking price is not known but it may be at a level that might accommodate a discount of up to 10% for some repair or another and the real estate agent fee is 6%. He said he could pay cash to avoid the agent's 6%.
Can an agent be avoided on a cash sale? I would insist on a legal documents and the rest, closing, etc. with a real estate lawyer in town. I want all the legal necessities to cover any future failure of some device like the heating unit, or any damage due to the failure of some part of the home.
The real estate agent shows the home, gets it listed, takes photos, may have an inspector to do the inspection. I know a home inspector.
What are the reasons to omit the need for an agent?
And go with normal home sale legal documents and a lawyer.
An appraisal might be in the buyers favor so I might like to avoid an appraisal. Then again he has cash and should be able to get a mortgage but there may be some reason they can not. Poor credit maybe but I do not discriminate against people with poor credit and "cash" to buy something.
What are all of the things to consider in this scenario and of course real estate agents are going to promote the need for an agent. Maybe we could use a seller's agent or buyer's agent but not both to save 3%?
#1 You know these people. You won't be bringing people into your home that might rob you.
#2 Cash deals should be handled by your attorney
#3 If you've already contracted with an agent to sell the house, They may hold you for the 6% claiming that the deal was put together by them.
#4 Mortgage companies won't exist in a cash deal.
#5 Talk to your lawyer about future failures like the heating unit.
#6 Any home inspection is the responsibility of the buyer. If you hire one, it is to know what is wrong with the house, nothing more.
#7 It sounds like you already have a realtor that you've listed with. Have him/her show these people the house.
#8 The ball starts rolling with an offer.
#8a Through counter offers you arrive at an agreed upon price. The buyer makes certain contingencies on the purchase. Appraisals are usually required by the bank.
#8b You get a lawyer, he gets a lawyer.
#8c You sign a contract with agreed contingencies. This is where the title search gets done.
#8d Money goes into some lawyer's escrow account. Yours or his, I forget.
#8e You hand over the keys at the closing.
#8f The lawyers follow up with the county.
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