015 Show Me The Money! Cash vs. Financed Offers

015 Show Me The Money! Cash vs. Financed Offers

Have you ever had a few million bucks just itching to leave your pocket? Maybe when you did you thought hey I’ll go to NYC and buy an apartment and get a huge discount? Think again. We all know "cash is king" as who doesn’t love cash, but it’s...


Have you ever had a few million bucks just itching to leave your pocket? Maybe when you did you thought hey I’ll go to NYC and buy an apartment and get a huge discount? Think again. We all know "cash is king" as who doesn’t love cash, but it’s more buyers pay in cash here than you might think and it doesn’t always mean you will get a big discount or that if you are bidding against other buyers that you will be the one who gets the property. Today we are discussing cash vs financed offers and what to consider regarding each of these forms of payment when buying in NYC.

In a competitive market, it is hard to beat an all-cash offer. Many people do not have the means to pay all cash and need to finance their purchases. When making an offer, where obtaining financing is critical to the buyer, this is called a contingent offer. A non-contingent offer is when a buyer will secure a mortgage but for whatever reason, fails to do so, will need to pay cash at closing. If you are a cash buyer, you still need to consider your post-closing liquidity when you are purchasing in a co-op as opposed to a condo that does not have the same financing constraints that a co-op does. 

A seller may be tempted by an all-cash offer because the process to close is going to be quick and often without an appraisal. But not always does the cash offer win the bid. Often offers could be lower because buyers feel that cash offers a certain amount of advantages. This is not always the case. A seller and their broker will analyze the buyer’s profile to ascertain the likelihood of the buyer’s ability to secure financing. There is no general rule or practice about this. It really is transaction-specific. 

Any other questions? Reach out to us at www.therealestatebroadsofnewyork.com or you can email us at deniseandsharon@compass.com

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