I just had a post featured today that discusses the custom when handling multiple offer situations. In that discussion, I forgot one interesting side note from Silicon Valley. There are and continue to be sellers who tell listing agents "Cash offers only". With more than 20% of all offers being cash, sellers are inclined to avoid the issues of appraisals and financing by going only to cash buyers.
The premise behind accepting only cash offers is that the sale can close in days instead of weeks. The seller doesn't have to worry about inspections or appraisals. There is far less paperwork involved and fewer "moving parts". For the seller, an all cash offer is a dream. It's like selling something at a garage sale - hand over the product, take the cash, walk away.
But My Buyer Will Pay More!
The buyers with financing often complain that being excluded isn't right. Agents claim ethics violations and buyers whine about discrimination. Neither apply - it's the sellers choice. There's nothing discriminatory about telling a buyer "cash only", except its a bias to people who are wealthy (per se). The real conflict comes from buyers who offer MORE than the cash buyer. That's a great source of frustration.
Here's an example: A buyer with financing writes an offer at $500,000 but gets rejected in favor of an all cash buyer with $475,000. The higher price buyer gets angry their "better" offer wasn't accepted. The seller, however, prefers "the sure thing" of the cash buyer.
It's a tough market. There may be ways to overcome a seller's preference for "all cash" but it will always come down to terms. Depending on the situation, you might be able the get a break. However, if the seller makes an exception for one buyer they have to make it for all - in my opinion. If you can't complete due to financing, just keep trying.
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Bryan Robertson, CEO | T: 650.799.9951 | Email: firstname.lastname@example.org | Website: http://www.BryanRobertsonHomes.com |CA BRE# 01191946 | Catarra Real Estate, Inc | 171 Main St #220 | Los Altos, CA 94022