Cash Buyers vs. Conventional Financing

Cash Buyers vs. Conventional Financing

Most of us are familiar with conventional financing – you go to a bank and take out a mortgage, enabling you to purchase a home.  But what about cash financing? What exactly does it mean for a buyer to offer cash for a property, and how does a cash transaction differ from a traditional one?  Today on Whiteboard Wednesdays, we delve into the specifics of each method.

Cash financing, despite its name, does not mean that the buyer hands over a literal bundle of currency in exchange for a property.  Rather, it means that a buyer has the money available for the purchase in their bank account, or that they’ve financed the purchase through non-traditional avenues such as a private IRA or 401k account or a private lender.  A cash offer is not contingent upon an appraisal or inspection of a home, which can often make it less likely to fall through during the sales process.

Conventional financing, on the other hand, is dependent upon a number of factors that come into play during the sale.  Traditional bank financing will typically require that a property appraises at an appropriate value, that it passes an inspection, and that the buyer maintains good credit throughout the process.  If any of these factors isn’t up to snuff, financing may be withdrawn and the sale may fall through.

There are benefits and drawbacks to both methods of financing, and the best option for you – as a buyer or as a seller – may depend upon your specific situation.  To learn more about financing, contact us today at or by calling 828-222-6443!

Cash Vs. Conventional Financing | Whiteboard Wednesday
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