Buying with Cash? Here’s Three Ways the Closing Process May Change

Being able to buy a home (or other property) with cash is a major achievement. It means that you have enough money up front and do not need a lender to facilitate the process.

Closing on your purchase happens a bit differently when you’re paying with cash. If you’ve been through the regular process before, you may be caught a little off guard by the differences. Here’s some of the changes to the closing process to help you know what to expect. 

1. Proving that you actually have the necessary funds

Anticipate that the seller will only be willing to take their home off the market when you provide proof that you have the money to close.  You can provide a copy of your bank statement quickly and easily, but if you don’t feel comfortable with this, most banks are willing to give you a proof of funds letter. Keep in mind that it may take a few days for your bank to provide a proof of funds letter, so if you are house hunting, ask for the letter from your bank ahead of time.  

2. Time frame

Paying with cash speeds the process up, but not as much as you may expect. There is still some due diligence that should take place, e.g. a property inspection and title search which are generally still necessary. (Due diligence involves a wait period of typically 30 days or so, which may be necessary on the buyer’s end, for example, if they are purchasing another house.)  The fact that you are paying with cash gives you flexibility to close quickly, which you may even be able to leverage into getting a lower offer accepted if the seller is in a hurry to close quickly. 

3. Paying

You will not actually have to withdraw hundreds of thousands of dollars of physical cash as you may be imagining (i.e. all out at once). You will, in fact, pay the same way you would have paid as the down payment, just like if you were taking out a mortgage. Generally, you will need to “wire” the funds from your bank to the seller’s bank. This will occur just before closing is scheduled. 

Need help?

If you are buying a home or other property, with cash or otherwise, the attorneys at Reyes Law Group can help. Our attorneys have the knowledge and experience to represent your best interests through closing. We routinely advise our clients on real estate transactions with close attention to detail and commitment to advocating their position, and would welcome the opportunity to do the same for you. Give us a call at (954) 369-1993 to get started!

Written by Reyes Law Group