There are many ways to buy a new home, but the most popular way to do so is by getting a mortgage. Mortgages are so popular that some people assume that they’re the only way to purchase a home, but this is incorrect. Purchasing a home in cash is another option that forgoes the home loan and pays for everything up front. It isn’t viable for everyone to use, but homeowners who can pay in cash absolutely should. Here are some of the reasons why home buyers should purchase their new home in cash if the option is available to them.
Sellers Love Cash Offers
If a seller has to pick between a cash offer and a mortgage offer, nine times out of ten they will go with the cash offer. There are many reasons for sellers to like cash offers. For example, a cash offer completely removes the need for a lender middleman from the sale, and it also reduces the chances of the deal falling through due to monetary reasons. Even a buyer who is pre-approved for a loan has a small risk of having their approval revoked after the fact. Cash offers also speed up the selling process, which puts less stress on the seller.
Buyers Don’t Need Mortgages
Easily one of the most attractive benefits of buying a home with cash is that the buyer doesn’t need to worry about getting a home loan at all. They don’t need to get pre-approved or spend time choosing which type of loan they want. And most importantly, the buyer doesn’t need to pay interest. Not having to pay interest makes purchasing a home with cash less expensive than purchasing a home with a mortgage. These benefits make the home buying process easier on the buyer.
Buying With Cash is Faster
Using a mortgage can slow down the process of buying a home. First, the buyer needs to get pre-approved for their loan, which takes several days. Then, after their offer has been accepted on a home, they need to wait for the lender to re-examine their credentials to see if they’re still eligible for the loan. Having to go to a lender for approval every time something changes is a time-consuming process that slows down the buying process. This can potentially be inconvenient for both the buyer and seller, especially if there are unforeseen delays. However, with a cash offer, there’s no need for any of this. The home buyer can submit their offer and purchase the home without so much as talking to a lender.
The Buyer Immediately Gains Full Equity
Normally, when a buyer purchases a home with a mortgage, they gain equity in the home little by little as they make mortgage payments. It’s a slow process that takes 15 or 30 years, depending on the mortgage in question. When a buyer pays in cash, there is no waiting for equity. As soon as closing is finished, the buyer gains full equity in the home. This gives them the freedom to use that equity to take out home improvement loans or other similar loans.
While purchasing a Durango home with cash isn’t possible for everyone, those who do have the option should absolutely do it. Purchasing a home in cash offers a lot of benefits both for the buyer and the seller, and buyers should not pass up an opportunity to do so.