Cash House Buyers Explained

Jane Wardle

Written by Jane Wardle on November 27, 2018

Updated November 18, 2019

cash house sale explained

During the property buying and selling process, you will probably come across the term cash buyers. More and more people in the UK are selling their homes to cash buyers but understanding what a cash house buyer is and how it differs to a regular house sale can be confusing.

Whether you are buying a property as a cash buyer or selling your home, it is important to understand what a cash house buyer is and the advantages and disadvantages of using them.

What Is A Cash House Buyer?

In simple terms, a cash buyer is someone who has the cash available to purchase a property outright without the need for a mortgage or other form of funding. They will not be relying on selling another property to fund the new property purchase; they will have the money available immediately.

Cash house buyers could either be an individual that has the cash to buy the property outright, or a specialist property buying company that can purchase homes for cash.

If you are buying a house as a cash buyer then be sure to let the seller know you have the cash available to buy the home outright. It is generally seen as a significant advantage over other potential buyers who have to arrange mortgages.

Is The Buying Process Different For A Cash House Buyer?

When you are buying a home, there are a number of different parties involved, including the buyer, the seller, the estate agents, the solicitors, the mortgage lender and anyone involved in the property chain.
If you are a cash buyer, then there are some small changes in this process as a mortgage provider is no longer needed. By removing this step of applying for a mortgage, waiting for approval, and any surveys or checks the mortgage company want, it makes the whole process significantly quicker. Conveyancing and surveys will still need to be carried out, but the risk of delays caused by external factors is dramatically reduced.

Selling to a cash house buyer is usually also significantly less risky as the buyer will not need to be approved for a mortgage and will have no chain that they are waiting on in order to receive their money.

Benefits Of Selling To A Cash House Buyer

  • Less chance of the sale falling through. One of the main reasons for house sales to fall through is that the buyer loses their funding. This could be that their mortgage was not approved, or their house sale fell through and can’t get the money out of their current property. When you sell to a cash buyer, this risk is eliminated.
  • The process is simpler. When you take out the need for a mortgage company to be involved in the house sale, you also take out a lot of the complications. The selling process will usually be significantly simpler and quicker when you are selling to a cash buyer.
  • No chains. Cash buyers will not have any chain holding them back from purchasing your property. In most house sales there is a lengthy chain, and if one link of that chain falls through then, it can affect many house sales.

Many cash buyers will expect to pay a bit less than market value for the added benefit of being able to buy the property outright. You might find that cash buyers will offer less than your asking price in return for a quick and easy sale.

What Are Cash House Buyer Companies?

Cash house buyer companies

There are a large number of companies out there that specialise in buying properties for cash. They can buy a home very quickly, sometimes within a matter of days, and buy the property outright with cash.
These kinds of companies generally operate online and are a good option if you need a very quick property sale and can’t wait to find a buyer or go through the whole selling process. House buyer companies will not pay the full market value of your property and will instead offer you a discounted price to buy your home for cash very quickly.

These types of companies can be a good choice if you need to unlock the equity in a property very quickly. If you want to avoid house repossession because you have got into too much debt to manage or need to get rid of a property you have inherited in a short time frame, then a cash house buyer company might be the best option for you.

Never use a cash house buyer company if you want to receive the full value of your home. These companies will always offer a significantly discounted price in return for a fast and easy sale.

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