Selling a House for Cash: The Pros and Cons

Selling a House for Cash: The Pros and Cons

Finding a chain-free cash buyer for your home sounds like a dream, doesn’t it?

We all know what a nightmare property chains can be — perhaps you’ve experienced the stress and expense of a failed sale before? But why is selling a house for cash seen as the holy grail for so many homeowners? And is it what it’s cracked up to be?

What Does “Cash Buyer” Mean?

A cash buyer is a person who can afford to buy your property outright without the need to secure financing, such as a mortgage loan. A “true” cash buyer has the funds ready to make the purchase when they submit an offer. Beware, some buyers may declare themselves a cash buyer — or your estate agent may describe them as such —  if they are set to become a cash buyer when they sell another property.

There are also cash house buying companies that can offer a quick house sale for cash. Again, it’s worth asking a few questions to check that the company is a genuine cash buyer. Some companies will market themselves as such when they actually need to secure financing to buy your property, or they intend to pass your details on to a third party who can buy your home for cash.

As you can tell, the definition of a cash buyer is not always black and white. Make sure you know who you’re selling to before getting excited about a “cash offer”. 

Why Would Someone Sell a House for Cash Only?

Some homeowners may stipulate “cash buyers only”. This means that they will only allow viewings and accept offers from people who have the money to buy the property outright. Their estate agent may ask for proof of funds before agreeing to book a viewing or allowing you to submit an offer.

A seller may opt for cash buyers only if they need a quick house sale or perhaps if they have previously had a bad experience with property chains. Cash purchases typically take less time to complete than those that involve a buyer who needs to secure a mortgage or other funding because there can be delays if a buyer struggles to get the loan they need and has to shop around. There is also a greater chance of a failed sale with a non-cash buyer — problems securing a mortgage is the most common reason house sales fall through in the UK.

Is it Better to Sell Your House to a Cash Buyer?

There are several advantages to selling your house to a cash buyer:

  • No property chain. 

If your buyer pays cash, there is no risk of the delays and expenses a broken property chain can cause and much less risk of a failed sale. 

  • A quicker sale.

Arranging a mortgage can take time. Selling to a cash buyer means you skip this step entirely, which speeds up the sale. If you sell to a cash house buying company instead of an individual, the sale could complete in as little as 7 days.

  • More Certainty.

Cash buyers are often developers with a lot of experience. They won’t offer on a property unless they are eager to see the transaction through. Even if your buyer is not a developer, cash buyers tend to be more reliable as there is no uncertainty about what they can afford. If you sell to a genuine quick house sale company, they can offer a guaranteed sale.

  • Easier to sell a “problem” property.

Some properties are unmortgageable or incredibly hard to secure a mortgage on. If your buyer has cash, they have the freedom to decide if they want to purchase your home or not.

Download our free e-guide and learn how to choose a quick sale company you can trust

Are There Any Disadvantages to Selling a House for Cash?

Cash buyers often drive a hard bargain. They may make a lower offer because they understand the benefits you will get from selling to a cash buyer.

It’s also important to remember that cash sales can fall through just as a house sale to a non-cash buyer could. If the buyer changes their mind for some reason, perhaps a house they prefer comes on to the market, they can legally withdraw from the sale any time before contracts are exchanged.

However, if you sell to a cash house buying company rather than an individual cash buyer, the sale is typically guaranteed — once a survey has been done and you have accepted a firm offer, the deal is done. 

You should take the time to research your cash buyer, whether they are an individual or a quick house sale company. Do they have the funds to buy your property in the agreed timescale? Do they offer any kind of price promise, or will they chip away at their offer, leaving you with a much lower sale price than you’d hoped for?

What Happens If You Sell Your House for Cash?

The process for selling a house to a cash buyer is essentially the same as it would be if you sell to a buyer who needs to apply for financing. The only difference is that you won’t have to wait for the buyer to get their mortgage application approved.

It also typically takes less time for checks such as surveys and searches to be completed if the cash buyer manages this rather than a lender to whom you are just another customer. 

If you need to sell your house fast or simply want to avoid the risk of property chain problems, delays, stress, and a failed sale, contact us today for your free no-obligation cash offer.

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