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the all-cash head fake


By justme   Follow   Fri, 9 Nov 2012, 9:04am PST   1,765 views   9 comments
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http://www.marketwatch.com/story/new-real-estate-fad-the-all-cash-head-fake-2012-11-09?source=Patrick.net

Not all "cash buyers" really are cash buyers...

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thomaswong.1986   Fri, 9 Nov 2012, 9:59am PST   Share   Quote   Permalink   Like   Dislike     Comment 1

justme says

Not all "cash buyers" really are cash buyers...

Its really lame for journalist to state cash vs mortgage.. since majority ( up to 99%) RE contract is closed and settled "in cash" vs seller getting a note. So having a buyer be "all cash" or mortgage is irrelevant matter. How the buyer finances a purchase is a matter between Buyer and Banker.

Decades ago did I like everyone else buy their home "all cash"..
yes and I financed it.. without the the interest and knowledge of seller(s).

.

thomaswong.1986   Sat, 10 Nov 2012, 8:35am PST   Share   Quote   Permalink   Like   Dislike     Comment 2

robertoaribas says

A cash offer with verified funds is a much more sure deal than ANY financed offer.

along with your bank and investment statements, complete list of other assets and a count of you change in your pockets...

its no wonder many were fleeced out of their savings.

it only shows how naive the public has become when buying RE over the past 10-12 years. YOU NEVER tell the other side about your financial well being. That is not for them to know.

this is why you have a lawyer.. to look out for your interest.

thomaswong.1986   Sat, 10 Nov 2012, 8:41am PST   Share   Quote   Permalink   Like   Dislike     Comment 3

robertoaribas says

In a cash offer, if the buyer fails to buy the home, the seller can cancel and generally keep the earnest money.

really ? .. is that true in california as well regarding breach of contract laws..... carefully now !

Peter P   Sat, 10 Nov 2012, 10:02am PST   Share   Quote   Permalink   Like   Dislike     Comment 4

Is delayed-financing considered a purchase-money loan in CA?

thomaswong.1986   Sat, 10 Nov 2012, 10:05am PST   Share   Quote   Permalink   Like   Dislike     Comment 5

robertoaribas says

Typical statement form someone who has no clue... When a buyer with a million dollars in cash makes an offer of $100K on an investment home, nobody thinks they'll pay more just because they have more..

you are not being very honest here.. of course you dont disclose your financial position. whats the point of negotiating if they already know ...

the typical buyer pulled every dime out of their savings and then some...

they were not good negotiations and got taken to the cleaners.

Peter P   Sat, 10 Nov 2012, 10:15am PST   Share   Quote   Permalink   Like   Dislike     Comment 6

thomaswong.1986 says

the typical buyer pulled every dime out of their savings and then some...

The typical buyer is not an all-cash buyer though...

thomaswong.1986   Sat, 10 Nov 2012, 10:50am PST   Share   Quote   Permalink   Like   Dislike     Comment 7

robertoaribas says

Thomas, you have zero clue. You can't write a cash offer without showing proof of funds.

there is no requirement of such kind in contract laws.. you know that.

all contract deals are done on good faith...

there isnt any due diligent requirements here.

and if there were.. i tell them... "talk to my bank" and "good luck"...

the common person has lost their common senses

again buyers ignorance is being used against them...

every buyer should at minimal get a lawyer... or they will get shafted from day 1.

pkennedy   Sat, 10 Nov 2012, 12:44pm PST   Share   Quote   Permalink   Like (2)   Dislike     Comment 8

Roberto hit it dead on. There are many times when an all cash offer is the only way to close a deal. Especially right now! Banks are taking forever and forcing people to jump through hoops to get a loan. Get the property into your name with cash, and then work on getting the money back out.

CDon   Mon, 12 Nov 2012, 12:58am PST   Share   Quote   Permalink   Like (1)   Dislike     Comment 9

thomaswong.1986 says

robertoaribas says



A cash offer with verified funds is a much more sure deal than ANY financed offer.


along with your bank and investment statements, complete list of other assets and a count of you change in your pockets...


its no wonder many were fleeced out of their savings.


it only shows how naive the public has become when buying RE over the past 10-12 years. YOU NEVER tell the other side about your financial well being. That is not for them to know.


this is why you have a lawyer.. to look out for your interest.

Actually, any lawyer with experience in the matter will tell you that proof of funds is an essential component of a cash offer. I do a ton of commercial transactions where (depending upon the type of business, issues with the property, etc.) financing is difficult to get, and cash is king.

However, I have also found that roughly 75% of the time that someone makes a "cash offer" but doesnt provide proof of funds, its because they dont have the cash.

When you inquire why no proof of funds, what usually follows is a parade of excues - "I dont have the cash but I will get it soon" or "I dont have the cash but I have this asset which I will sell for cash (and then half the time they dont do that)" or some other excuse which largely ends up being a waste of time and attorneys fees.

Thus, if I am Buyer's counsel, and my client wants to do cash offer - no proof of funds, I immediately ask why he wants to portray to the other side: "there is a 75% chance I am a liar and I really dont have the cash".

Likewise, if I am Seller's counsel, and his broker brings 3 "all cash" offers and 2 of them do not provide proof of funds, I tell my client there is a very good chance these 2 guys are liars and (unless they can prove funds ASAP) go with the third who has already demonstrated he has the funds and is serious about moving forward.

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