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Original poster

Did we stand any chance against cash buyer?

61 replies

Extraslice · 27/08/2021 18:56

We lost out again to a cash buyer, on a dream home. Don’t tell me something else will come along, as in this market currently, for that money, I can assure you it won’t!
I am so surprised by my response to this. I haven’t stopped crying for the past few days. And I can’t seem to accept it. I keep trying to rationalise it.
There were 3 offers all at asking price and they went with the cash buyer.
Could we have done more?? Or was there always no chance? My head is filled with ‘what ifs’.
I know this sounds extreme (and crazy) but we love it so much —also have a 6 week old baby so it could be hormonal—

OP posts:
crimsonlake · 28/08/2021 12:40

I was a cash buyer and I don't agree it makes the process necessarily quicker. It really depends if the sellers are in a chain, how long the chain is etc.

Original poster
Extraslice · 28/08/2021 19:04

Thank you for your messages, they are making me feel better. Though I am still really down about it.
To make it worse the vendor is sending me other properties in the area which is really kind of her, but they are nothing like hers. I haven’t replied yet as don’t want to make her feel bad when really I want to say that we aren’t even viewing any others at the moment as we feel too gutted 😣
@ComeonJulia I wish everyone thought like you!

OP posts:
ComeonJulia · 28/08/2021 19:41

You will get somewhere, I know it doesn’t feel like it now but it will happen.
I wish you so much luck and I really hope you find your new home soon.

Woooooman · 28/08/2021 20:10

Our cash buyers turned out not to be cash buyers so people definitely lie! Even if they show proof of cash, doesn't mean they will use it to buy the house!

Gemma2019 · 28/08/2021 20:12

I've sold several houses in the last few years, the last in May this year, and nearly all of the people who purported to be cash buyers actually meant that they would be cash buyers after the sale of their property went through. Obviously they omitted to mention the second part, or the fact that they were in a chain too.

I take anyone who says they are cash buyers or not in a chain with a huge pinch of salt and would prefer a FTB.

I know none of that helps you though OP, and I hope something better comes along for you soon. It's really hard when you set your heart on a property and lose it.

Woooooman · 28/08/2021 20:12

Good luck - it's a funny market at the moment and not everyone prefers cash buyers :)

Original poster
Extraslice · 28/08/2021 20:40

Thanks all ❤️

Anyone any idea how I reply to the vendor?? I keep typing messages and deleting them. Resisting the temptation to beg her to change her mind Grin

OP posts:
Woooooman · 28/08/2021 21:27

I would tell her if something goes wrong with the sale, pls don't forget us or something like that.

But also just because she feels guilty (which she obviously does a bit!), don't let that make you feel more shit!

nonotmenotI · 28/08/2021 21:29

This happened to us op. She went with cash buyer so it was quicker but we were quicker with our chain.

Chumleymouse · 28/08/2021 22:20

When your a cash buyer you have to show proof of funds to the ea and the solicitor as soon as the offer is accepted. So lying about it isn’t going to get you very far ?

Original poster
Extraslice · 29/08/2021 09:23

@Chumleymouse yes and EA said they did this straight away Sad

OP posts:
Woooooman · 29/08/2021 09:42

@Chumleymouse doesn't mean they will use the funds to buy the house though. Ours must have showed something but it turns out they were always planning to get a mortgage (let slip by their solicitor)

NoSquirrels · 29/08/2021 11:45

There were 3 offers all at asking price and they went with the cash buyer.
Could we have done more?? Or was there always no chance?

You couldn’t have done more. We were in a similar situation and even rejected a couple of above-asking price offers in favour of an asking price cash buyer. It suited our circumstances at the time, the estate agents warned against one of the offers as they’d previously been partway through a chain and withdrawn so for us their history of being a bit flaky ruled them out despite the extra few grand offered, and whilst I felt bad for the other set of FTB offering (& it was a great offer in other circumstances I’d have been thrilled to get) the security of a very quick sale with no chain was too important to us.

Hope your new house is right around the curb we, OP. Flowers

WombatChocolate · 29/08/2021 12:45

Surprising how people don’t understand what a cash buyer is.

It is some one who has the money available without the need to sell a property or to get a mortgage.

When EAs tell you there is a cash buyer wanting to view, I’ve always asked them to verify that the buyer doesn’t have a property they need to sell or need a mortgage. Sometimes they’ve already done this, and sometimes haven’t and then find they aren’t actually a cash buyer.

As soon as an offer is accepted, the EA should be working on producing the Memorandum of Sale, which basically formalises the offer. They should be seeking evidence of funds (full funds for cash buyer, or deposit and mortgage offer in principle) and also estate agent details.

One way you can become the best buyer possible and sometimes be more popular than a cash buyer, is if you present all of your paperwork to the EA before viewing….this means, showing them evidence of funds and giving details of the EA you will use. Details of any buyer you already have on your property can also be given. A simple A4 sheet of details can be given or emailed. What this does is shows you are serious, understand the buying process and are ready to proceed. It can mean the EA advocates for you. It also means they are more likely to contact you quickly when new properties become available.

You can’t beat a cash buyer, in the sense you need a mortgage and they don’t, which is another area where sales can break down, but you can put yourself in the strongest position possible. Cash buyers, can sometimes drive a hard bargain over price at offer point or later in the process and some people will avoid them for this reason, or if they are an investor, because some people would rather sell to owner occupiers.

FTBs can be a bit clueless and slow to respond to info requests from EA or solicitor. By showing you understand the process and are genuinely proceedable, you become a better buyer.

Original poster
Extraslice · 29/08/2021 13:40

Thank you @NoSquirrels🙏🏻

This is brilliant advice @WombatChocolate thank you so much! I wish I’d had this a couple of weeks ago

OP posts:
flowery · 29/08/2021 13:44

We went with a buyer with a short chain rather than the cash offer we had, because they explained exactly how far the short chain had got in the process, reassured us that they could manage without a mortgage if absolutely necessary, and offered us £50k more than the cash buyer.

If any of those hadn’t been the case we’d have gone with the cash buyer.

LemonSwan · 29/08/2021 13:53

Its annoying because cash buyers are never cash buyers.

We recently sold and went with a cash buyer, also the highest offer so a no brainer.

Our absolutely cash buyer now has turned out NOT to be a cash buyer.

In hindsight if we were choiced with an end of chain seller (high value property) vs a FTB, no chain and 5k less - we would have gone with the latter.

So YANBU unreasonable to be annoyed OP.

I think they need to reform the rules that an offer of cash, is only sold for cash to stop this.

LemonSwan · 29/08/2021 13:58

And to the vendor, I would text back:

Thank you so much for all your help. You have been very kind going out of your way to help find a property for us. Unfortunately we have fallen in love with your property and feel we need to take a break from house hunting for a while. It will be difficult for anything to compare and we dont want this to cloud our judgement in our future search. We hope your sale goes smoothly but in the event it falls through please contact us. Thanks again and best wishes, Extraslice and Family

WombatChocolate · 29/08/2021 14:10

As cash buyers often turn out not to be, if you’re the seller, it’s really important to press your EA that they see actual proof of evidence of funds.

Good EAs automatically ask buyers for this when preparing the memo of sale. It’s required for anti-money laundering too.

When choosing who to market your property with, you can ask if they vet prospective buyers and check their buying position ina advance of showing properties. Some make it clear to buyers, that if they make any offers, they will be expected to provide evidence of funds (deposit and mortgage in principle, or full funds for cash buyer) at the same time as offer, before it can be accepted. Some will provide it in advance of offers to out themselves in stronger position. You really do t want to accept an offer and find out 3 weeks later that the financial position isn’t as described and you’ve lost a stronger buyer.

Puzzledandpissedoff · 29/08/2021 14:18

*People who say they are cash buyers do not always tell the truth.
... like the ones who say they have no chain

Indeed - and developer or not, IME even the genuine ones are more likely to play stunts such as dropping the offer at the last minute, once they've got the purchase on the basis of their appealing position

Rocktheboat87 · 29/08/2021 16:45

I occasionally watch the tv show "Million dollar property" and the brokers always seem to suggest the cash buyer. I guess because although very similar to a mortgage it is less hassle. I don't have mortgage but for example a cash buyer can proceed without a survey. I'm guessing the bank would demand this. As a result more time is needed and what if the survey finds something. The bank will say that you can not proceed.

I guess this is where the saying "Cash is king" came from.

Gemma2019 · 29/08/2021 18:38

@Rocktheboat87

I occasionally watch the tv show "Million dollar property" and the brokers always seem to suggest the cash buyer. I guess because although very similar to a mortgage it is less hassle. I don't have mortgage but for example a cash buyer can proceed without a survey. I'm guessing the bank would demand this. As a result more time is needed and what if the survey finds something. The bank will say that you can not proceed.

I guess this is where the saying "Cash is king" came from.

The survey and mortgage situation is another reason I don't favour cash buyers. Non cash buyers have to put down money almost immediately to progress the purchase - a survey, mortgage reservation fee, searches etc. A cash buyer can bypass most of that and pull out at any time if something better comes on the market, without it costing them anything. A buyer needing a mortgage is less likely to pull out on a whim as it means they will lose at least a couple of thousand.

Suzi888 · 29/08/2021 18:40

Cash is king, so I would say no.
(I’ve been the victim too OP, so I feel your pain).

TheHouseILiveIn · 29/08/2021 18:41

@Chumleymouse

When your a cash buyer you have to show proof of funds to the ea and the solicitor as soon as the offer is accepted. So lying about it isn’t going to get you very far ?
People might have the cash but have no intention of using it
TheHouseILiveIn · 29/08/2021 18:43

The survey and mortgage situation is another reason I don't favour cash buyers. Non cash buyers have to put down money almost immediately to progress the purchase - a survey, mortgage reservation fee, searches etc. A cash buyer can bypass most of that and pull out at any time if something better comes on the market, without it costing them anything. A buyer needing a mortgage is less likely to pull out on a whim as it means they will lose at least a couple of thousand.

This is a great point!