I want to buy a home under with cash (no loan needed) are my chances of getting a good deal better?

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July 07 2009
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Yes.  Even banks understand a bird in hand is worth two in the bush.  My recent experience tells me "move in ready homes" can be purchased for about 1 - 3% less than someone offering to buy with financing.  The real bargains can be had by looking at homes that are not financeable due to their condition.  Then the only competition is from experienced buyers.  Example:  If a home is in an area where like and kind homes typically sell for say, $200K and one you see for sale was in the middle of a bathroom remodel, it could only be purchased cash or with a rehab loan.  Rehab loans are a pain.  The bank would likely rather have cash.  If the completion of the bath might cost $3Kish, (get estimates) and you offered $180K and got the home, You did great.  You'd be in the house $183K and it's worth $200K.
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July 07 2009
Even with a cash offer, banks will always look at what their bottom line # would be.  They usually order what you call a broker's price opinion that gives them an idea of what the current value of the property would be if they sell it in 30, 60, 90 or 120 days.  I have seen cash offers that are not being accepted because they are lower than the rest of the offers.  If you are considering buying a home, just make sure that you are putting in a reasonable offer.

Good luck!
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July 07 2009
You have leverage - you can close the deal without a financing contingency and close as quicky as you chose. It's a serious leg-up on most other buyers, but doesn't mean you will get a fire-sale price. Other factors will come into play as well - if a property is newly listed, the seller will likely test the market; if a property has been exposed to the market for a while, it's probably overpriced to begin with and a cash offer may work in your favor. 
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July 07 2009
Cash is king, go for it! Always reserve the right to finance the purchase just in case you come to your senses before you close on the deal, especially if the purchase will deplete your reserves.
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July 07 2009
 
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