Buying A Property CASH, I NEED ADVICE/HELP

shoot2kill · #1 05-01-2014

So I am looking to purchase my first property with cash, but I have no real estate knowledge. I have a few questions if anyone could answer them please do.

1. When do I get place under contract?

2. Do I get the house appraised and inspected before or after I get it under contract.

3. Can I make adjustments to the contract if any property issues are found?

4. Will the listing agent try to lie to me just to make a sale?

5. Can anyone give me the rundown on what I should or shouldn't do or lookout for?

Any information is greatly appreciated!

- Shoot

yankee · #2 05-01-2014

Elaborate.
why cash?
Title opinion?
Raw land? Cashflow? fix and flip? Strip mall?
Who is writing the contract?
Why not add in all contingencies you have?
and at least 100 other questions.

shoot2kill · #3 05-01-2014

I am buying cash because I figured it would be easier to acquire. Im buying foreclosed townhouse to live in. After I make the required repairs and touch ups I would like to rent it out. No one is writing the contract as of yet. (who should write it). All other question I dont know and dont have the answers to.

dreamerplus · #4 05-01-2014

Quote:

Originally Posted by yankee

Elaborate.
why cash?
Title opinion?
Raw land? Cashflow? fix and flip? Strip mall?
Who is writing the contract?
Why not add in all contingencies you have?
and at least 100 other questions.

What do you mean why cash? Cash is the best better then credit, banks, or any type of control systems!!

yankee · #5 05-01-2014

What do you mean better? The absolute highest amount of risk is better?

Almost never in real estate is cash better. Cash as in green money is NOT ALLOWED at many title companies or closing attorney offices. I buy small dollar properties cash, as in counting out tens of thousands of dollars at an attorneys office for reasons that the seller wants. My attorneys 100% of the time want nothing to do with Green cash deals, even if recorded and photographed.

Agent usually follows your state laws and forms. Always more in line with protecting buyer with a good measure for closing in the sellers favor.

Anyways, I would follow basic procedures your agent and attorney state. A few would be full home inspection, title opinion with insurance, fully insurable at time of closing, if a full rehab is required contingencies of three estimates before closing to determine ARV and if you plan on living in it quickly, occupancy permit, ...

Personally, if it was my first purchase or first ten even, I would approach a lender preferably hard money just to review the deal. I can tell you for sure that if a good lender wont lend on it, I would never close. I am not saying that I would use there cash(although I almost would never use my own these days) but to get a better grasp on ARV and what it takes to make a solid real estate deal.

dreamerplus · #6 05-01-2014

I bought a house cash once, had never had issues. I don't know what you guys talking about.

yankee · #7 05-01-2014

Quote:

Originally Posted by dreamerplus

I bought a house cash once, had never had issues. I don't know what you guys talking about.

Once is not a very good measure of results and it is perfectly fine IF you have all your ducks in a row.

brownsauce215 · #8 05-01-2014

Banks cashiers check works just as good as cash. I purchased my first house with this method.

shoot2kill · #9 05-01-2014

Quote:

Originally Posted by brownsauce215

Banks cashiers check works just as good as cash. I purchased my first house with this method.

I am not buying using paper cash!

Count Chocula · #10 05-01-2014

Since you are the buyer, why not get a real estate agent?

GreenBean · #11 05-02-2014

Quote:

Originally Posted by shoot2kill

I am buying cash because I figured it would be easier to acquire. Im buying foreclosed townhouse to live in. After I make the required repairs and touch ups I would like to rent it out. No one is writing the contract as of yet. (who should write it). All other question I dont know and dont have the answers to.

What you need to do is find out the best method to use your own cash as the basis of the sale.

Say the house being foreclosed is $30,000, you are going to need ( at the least) another $20,000 for any & all of the following:

Repairs

Repairs

Pest Control reports

Local Council requirements ( property ordinance)
Land search : this is to determine if you in fact will get title to the property.
There may be claims that might not clear with the sale. Property may have a value of this $30,000 but mortage debts of $35,000 ( or higher).

I would consider checking with an attorney and a banker.
Good Luck

A

rsot · #12 05-02-2014

Definitely get a professional real estate agent - you will have coverage in the case of any details being missed...I have seen some cases of people who have DIY Home buying...has gone bad.

vogeltron · #13 05-04-2014

Been looking to do the same thing myself. I don't know why so many members are referring to cash as like counting out bills. It means you are buying with money in the bank or selling stock, bonds, assets etc to cover the cost and not financing with some sort of mortgage. Paying for the property outright.

From what I understand it is much easier to purchase a home in most areas. You can close quicker and have less paperwork. The one thing about buying outright is you may not need Title insurance. However, it may still come in handy even if not needed and be an insurance policy.

Lots of the nay Sayers will telly you at least in the states. You are losing out on mortgage interest deduction etc. You can get low rates. Blah Blah Blah.

I hear people say oh. I own my own house. Well you put basically nothing down and have a 30 year loan. Guess what you don't own your home until you pay that off and the Bank sends you the title.

For the most part if it is a regular transaction you have to put down a deposit on the place if you make and offer. Then provide proof of funds if it is a Cash transaction. Then you are given so many days to go through escrow. On your end get home inspection etc and close.

vogeltron · #14 05-04-2014

Quote:

Originally Posted by shoot2kill

I am buying cash because I figured it would be easier to acquire. Im buying foreclosed townhouse to live in. After I make the required repairs and touch ups I would like to rent it out. No one is writing the contract as of yet. (who should write it). All other question I dont know and dont have the answers to.

If you are buying at auction. There are certain rules for each state. Normally you will be responsible for any potential liens against the house if you win the bid and normally have to pay for the item in full withing 24 hours.

Once you get the deed to the house in your possession, and pay whatever filing fees for the county, city, state. Then you are good to go. Writing up the contract is usually between two parties. If it is a short sale usually the bank. Otherwise in your case it would not be a foreclosure by and means.

joew8989 · #15 05-04-2014

1. When do I get place under contract? After you agree to terms with seller

2. Do I get the house appraised and inspected before or after I get it under contract. You don't need to get an appraisal if you are paying cash. Home inspection can be contingent unless you are buying as is , then get a home inspection before negotiating purchase price.

3. Can I make adjustments to the contract if any property issues are found? If your offer is contingent on a home inspection. If you are buying as is then no.

4. Will the listing agent try to lie to me just to make a sale? Of course.

5. Can anyone give me the rundown on what I should or shouldn't do or lookout for?
Roof and Foundation. If you are paying cash you should get the house cheaper than if you were financing it, less hassle for seller. Make sure you get a title policy to insure clear title.

daveedo · #16 05-04-2014

Quote:

Originally Posted by shoot2kill

So I am looking to purchase my first property with cash, but I have no real estate knowledge. I have a few questions if anyone could answer them please do.

1. When do I get place under contract?

2. Do I get the house appraised and inspected before or after I get it under contract.

3. Can I make adjustments to the contract if any property issues are found?

4. Will the listing agent try to lie to me just to make a sale?

5. Can anyone give me the rundown on what I should or shouldn't do or lookout for?

Any information is greatly appreciated!

- Shoot

You would want to get an attorney to right a contract and make sure that the closing is contingent on a inspection. Also, make sure there is no liens against the place or any tax lien holders because they could end up taking the place from you. A tax lien is when someone does not pay taxes on a property so the county sells the taxes to the one willing to receive the lowest interest. If the taxes are not paid within a certain amount of years, 2 in most states, the tax lien holder gets to foreclose on the place.

Also make sure all the utility bills are paid for because a similar thing happens with them too.

rsot · #17 05-04-2014

While you wait for sale to go down, invest the cash to maximize % gained