This North Turlock home offers a charming living space with a great room concept, perfect for entertaining. The property is Approx. 1368 sq ft with 3 bedrooms and 2 full baths, with Inside laundry, and a 2-car garage for convenience. Remodeled Kitchen with an Island, Granite Countertops, and Newer Appliances. Remodeled living area with Newer Paint and Stunning Views. Backyard amenities include new concrete pads, 7-foot fences, a storage shed, and fresh landscaping. The master bedroom boasts double sinks, a large shower stall, and a walk-in closet. The home is situated to overlook the Country View, providing a picturesque setting. Walking Distance to Dennis Earl Elementary. A Must See!!
SOLD – 2017 Bristol Park Circle
Charming 3-Bedroom Home in Desirable Bristol Park! This beautiful 3-bedroom, 2.5-bath home in the sought-after Bristol Park neighborhood offers an ideal blend of comfort and practicality. The spacious floor plan includes formal living and dining rooms, along with a cozy family room. The inviting kitchen features an island, pantry closet, breakfast nook, and a convenient dining bar. Key Features includes Primary Suite Retreat with large walk-in closet, luxurious bathroom with double sinks, a jacuzzi tub, shower stall, and bidet. Plus, enjoy direct access to the backyard for ultimate relaxation. A Jack & Jill Bath is conveniently located between two of the bedrooms, this bathroom offers double sinks, making it perfect for sharing. The backyard is an entertainer’s delight with a unique spool (combination pool and spa), fruit trees, and plenty of space for outdoor activities. The shed provides extra storage. The 3-Car Garage features a drive-through design for easy backyard access, plus a fully equipped kitchen setup with electric stove, fridge, sink, and cabinets perfect for outdoor cooking or hobbies. A inside utility room is also featured. This home is across directly across from Bristol Park.
SOLD – 4094 Valkommen Dr. Denair
Luxurious Newer Home in Denair. This fabulous newer home in Denair presents in pristine condition, giving the impression and ambiance that it’s never been lived in. With approximately 1, 648 square feet of living space, this property offers both style and comfort throughout. Enormous great room that flows into an inviting kitchen. Stunning kitchen with large quartz island providing ample counter space. Abundant cabinetry perfect for cooking enthusiasts. 3 stylish and comfortable bedrooms. Convenient indoor laundry room. Practical butler’s pantry. 2-car garage. Potential RV storage space on the side yard. Spacious backyard offering endless possibilities for personalization. This property combines luxury with practical living spaces, making it an ideal home for those seeking both elegance and functionality in the desirable Denair area. A Must See!!
SOLD – 1862 Katherine Ct. Turlock
Custom, Remodeled, and Very Stylish Home!! Approx. 1922sf with 3 Bedrooms & with a potential 4th Bedroom, currently used as the Master Retreat. New Contemporary Design, New Imperfect smooth Sheetrock, Engineered Hardwood Floors, New Light Fixtures, New Interior doors with Emtek Hardware, Brizo Plumbing Hardware, Leathered Granite Counter Tops, and Marble Counters in Bathrooms. The Backyard is a Park-like setting with a cozy Fire Pit to enjoy the Big Trees & the large Patio area under the Trellis which is surrounded by the New Fenced Backyard. The Home also Features a 3 Car Garage & a Tool Shed in the Backyard.
SOLD – 42 ac Monte Vista Avenue, Denair
Surrounded by Orchards. Approx, 33 acres of Independence Almond Trees on Drip and Micro-Sprinklers, Planted in 2022 on 22×13 Spacing, Viking Root Stock. Also, Another 6 Acres of Butte (50%), Padre (16.7%), and Livingston (33.3%) Almond Trees planted in 2001, 18×18 Spacing, Nemaguard Root Stock, on Micro-Sprinklers and Drip. Both Blocks irrigate through the Neighboring Family Orchards through Booster Pumps off the TID Main Canal (Class 2) and 3 Irrigation Wells, Easement to be established prior to the closing of Escrow. Multiple and Adjacent Neighboring Orchard Properties are For Sale, too.
Is a 15-or 30-Year Mortgage Right for You?
You can build equity faster with a shorter term since more of your payment goes toward paying down principal.
Takeaways
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- When choosing a mortgage, two main options is a 30-year term and a 15-year term, though some lenders have additional options.
- A longer-term mortgage will usually mean lower monthly payments, but a higher cost over the life of the loan; a shorter-term mortgage will reduce the overall loan cost and may have a lower interest rate, but will require higher monthly payments.
- No matter your loan term, you can make additional payments toward the principal to save money and pay your mortgage off faster.
If you’re preparing to buy a home, you will need to look at not only mortgage interest rates, but also loan types and terms. Your mortgage term is how long you have to repay the loan, and most terms are 15 or 30 years.
Should you get a 15- or 30-year mortgage? If you can afford the payment on a 15-year mortgage, the long-term interest savings are great. But the lower monthly payment of a 30-year mortgage could offer you more flexibility if your financial situation changes.
Here, we break down the 15- vs. 30-year mortgage debate, including the pros and cons of each and how to decide between the two.
What Is the Difference Between a 15- and 30-Year Mortgage?
The primary difference between a 15- and 30-year mortgage is the length of time to pay off the loan.
A 15-year mortgage pays off your home in half the time of a 30-year loan and saves on interest overall. Borrowers typically qualify for lower interest rates for 15-year loans because the shorter term reduces risk for lenders.
The shorter term also means that more of your payment goes toward paying down principal, so you can build equity faster than with a 30-year mortgage. The trade-off is a higher monthly payment than a 30-year mortgage – at current rates, 20% or more. “The higher costs may not leave room for additional homeownership costs, such as renovations or unexpected repairs and maintenance,” says Shelby McDaniels, national director of business development at Chase Home Lending.
A 30-year loan’s lower monthly payment can provide more cushion in your budget. This can help make homeownership a possibility for more people.
30-Year Mortgage Pros and Cons
Pros
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- Lower monthly payments than a 15-year loan because they are stretched out over a longer time.
- Easier to qualify for this loan with its smaller payments.
- More room in your budget for other financial goals.
Cons
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- Higher interest rates because lenders consider a 30-year loan a greater risk than a 15-year loan.
- Higher total interest paid.
- Slower growth in home equity than a 15-year loan.
15-Year Mortgage Pros and Cons
Pros
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- Lower interest rates compared with 30-year loans because lenders take on less risk.
- Lower total interest charges than a 30-year mortgage
- Quicker loan payoff.
- Faster equity growth, with more of your payment going toward principal.
Cons
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- Higher monthly payments compared with a 30-year loan.
- You may not qualify for as big a loan because of the higher monthly payments.
- Larger payments leave less flexibility for other financial goals, such as saving.
Crunching the Numbers: 15- vs. 30-Year Mortgage
Let’s say you need a $300,000 mortgage and qualify for a 15-year at 6.5% or a 30-year for 7.5%. Here’s how those costs would compare:
| 15-Year | 30-Year | Difference | |
| Monthly Payment | $2,613 | $2,098 | $516 savings per month if you choose a 30-year mortgage |
| Total Interest Paid After Full Term | $170,398 | $455,152 | $284,754 savings in total if you choose a 15-year mortgage |
| Total Loan Amount After Full Term | $470,398 | $755,152 |
Alternatives to a Standard Mortgage Payoff
Exploring Other Mortgage Terms
If you’re on the fence between a 15-year and a 30-year loan, some lenders offer terms in the middle, such as a 20- or 25-year mortgage term. There are even some companies with 10- or 40-year terms if you’re looking for even more flexibility. Ask your mortgage professional to run the numbers to see which term option is best for you.
Paying Off Your 30-Year Mortgage in 15 Years
“There are tricks and hacks to dramatically reduce interest over the loan term,” says Erik Katz, president and founder of Rustic Country Real Estate in West Point, California. “If you take a 30-year loan and pay a few extra hundred a month, you may pay that mortgage down in 15 years anyway.”
Katz also suggests making an extra full payment at the end of each year if you can swing it to make a nice dent in the principal. You can also set up mortgage payments every two weeks, which results in an extra payment per year.
This way, if things ever get tight financially, you’re not locked into a higher payment. Just confirm that your lender doesn’t charge a prepayment penalty.
Refinancing
Starting off with a traditional 30-year term is best for many people. But if circumstances arise a few years into the mortgage that might allow you to refinance to a 15-year loan, such as a dramatic drop in interest rates, it could be worth exploring.
On the flip side, if you start out with a 15-year mortgage and the payments become difficult to manage, you can see if stretching it out into a longer loan term might help ease the financial pressure. Just be aware that doing so will mean paying more interest over the life of the loan.
15- vs. 30-Year Mortgage: How to Decide
Deciding between a 15- or 30-year mortgage comes down to finances and flexibility. Keep in mind that 30-year mortgages are far more common than 15-year loans for a reason: They are more affordable. The lower payment will give you more wiggle room, especially if your financial future is uncertain or your dream home wouldn’t be within reach with a 15-year mortgage.
On the other hand, a 15-year mortgage can offer savings if you have steady income to support your monthly payments and other expenses, including emergencies. “If the interest rate is a lot lower for the 15-year, that’s where I would advise to run the numbers,” says Katz.
Age may be a factor in your decision when weighing a 15- versus 30-year mortgage as well. “A 15-year mortgage could be a better option for those who are determined to pay off additional debts quickly, especially those who are preparing for an early retirement and want to minimize monthly payments,” says McDaniels.
A 40-year-old borrower, for example, could pay off a 15-year mortgage by age 55 while still owing on a 30-year mortgage through age 70.
If your ultimate goal is to save money, says Katz, “the name of the game is how fast can you get your house paid down.” Do the math and calculate your potential mortgage payment before you decide.
Source: money.usnews.com ~ By Dawn Papandrea ~ Image: CanvaPro
SOLD – 8238 Kapor Wy, Hilmar
Welcome to Hilmar Gold!! This Perfect Family home features Approx. 1524sf with 3 bedrooms, 2 baths on a Large Corner Lot. Great Room Concept with large Family Areas, Soaring Vaulted Ceilings, Cozy Brick Fireplace, And Formal Dining area. Updated Kitchen with Granite counters, Stainless Appliances, and Stylish Tile Floors. Backyard is very accessible from the Corner Lot. Tool Shed, Garden, Fire Pit, and Large Patio Area with additional Outdoor Living Space.
How to Sell Your Home While Living In It
Buyers have all kinds of schedules and you may sometimes need to show your house at the last minute, depending on the kind of market where your home is listed.
Key Takeaways
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- Buyers often make decisions based on quick impressions, so sellers should develop a system for containing the mess of daily life before showing a home.
- Declutter surfaces, closet space and cabinetry, and designate a space for children’s toys and pets.
- Check with your real estate agent about the housing market in your area and how many showings you might expect.
Buying a house was one thing, but now you’re ready to upgrade, and you have to sell that house while you live in it. It’s a problem a lot of homeowners face, and although selling your home while you’re living in it can be a challenge, it’s not an impossible situation.
In fact, it’s common for sellers to live in their house until they sell it. But to do it successfully, you’ll need a plan to keep your living space tidy and ready to show to buyers.
Begin at the Beginning
Getting your house ready to show requires thinking like a buyer. No one expects you to live in a museum, but you should consider the impact of your belongings and lifestyle on potential buyers who may come in to look around.
“Everyone sees things differently,” says Désirée Ávila, real estate agent at Charles Rutenberg Realty Fort Lauderdale in Fort Lauderdale, Florida. “Some like to see it with the current furniture, while others prefer to see it empty so they can imagine their own furniture in it. That being said, a tip I always give clients is to declutter and depersonalize. Make the house look neutral, kind of like a hotel room.”
Although most people with families and busy schedules can live a bit of a chaotic life behind closed doors, it’s important to develop a system for containing all the mess that comes with being a person before you start showing your home. Buyers often make decisions based on their impressions, regardless of how great your house is under the necessary layer of lifestyle.
“Leaving mail on the counter, dishes in the sink, etc., makes the house look messy, smaller and oftentimes gives the impression the house is in worse shape than it is,” says Rick Albert, broker associate and investor with LAMERICA Real Estate in Los Angeles. “In residential real estate, there is a lot of emotion and feelings. It trumps logic more than people will admit.”
Just How Much Should You Tuck Away?
Realtors will tell you to declutter, but they rarely go into great detail about what that means. For someone who is naturally a little cluttery, it can be hard to know when you’ve reached the peak decluttered point.
“Try to reduce every surface (countertops, dressers, coffee tables) by a third,” says Ginger Lazovik, real estate agent with the Falk Ruvin Gallagher Team of Keller Williams in Milwaukee. “A good rule is three items per surface. Make sure that each surface is free of clutter and has no more than three essential or decorative items on it. Next, downsize the items in your closet and cabinetry by half. When buyers tour, they open closets and cabinets. Overstuffed cabinetry makes your home look like it does not have enough storage.”
But where do you put all that stuff you need to remove temporarily, but don’t want to get rid of permanently? A lot of sellers will automatically rent a storage unit, but real estate professionals say that’s not always a necessary expense if you have suitable storage space in your home and not too much decluttering to do.
“If sellers are able to neatly store their boxed items in the garage, basement, or extra room in the home, a storage unit may not be necessary,” says Jessica Fisher, real estate agent with RE/MAX Professionals in Cottage Grove, Minnesota. “Potential buyers are forgiving of boxes as long as they are neat, tidy, and not hindering their ability to examine the space.”
Enhance Your Home Before Listing
You may have heard that a home needs to be professionally staged to sell. This is not necessarily true. When you’re living in a home that you’re selling, people understand that you still live there. It’s still important to make your home seem very appealing.
“A well staged home can include the owner’s personal furniture,” Lazovik says. “Make sure that you do not have too many pieces of furniture in any particular room. Remove overstuffed chairs or anything that looks worn or damaged. Add layers like cozy pillows and fresh blankets and throw rugs to freshen up your space. Fresh flowers add color and a clean smell.”
The money you save on staging can pay off big time if you spend it on improving the first impressions of your home. After all, if people drive by, but aren’t interested enough to walk through the front door, you’ll never sell your house.
“The outside is the first impression a buyer will get of the house,” says Ávila. “As the old saying goes, you never get a second chance to make a good first impression. Investing in making the outside look inviting is essential, otherwise some buyers may choose to pass on the house altogether.”
Managing Showings While You Live in Your Home
Once your house is ready to show – really ready – it’s time to figure out how to keep it in show-ready condition. Buyers have all kinds of schedules and you may sometimes need to show your house at the last minute, depending on the kind of market where your home is listed.
“The kitchen and bathrooms must look impeccable. Always close the toilets and pull the shower curtain,” says Ávila. “Little Johnny might not like to make his bed but it is important that it is made if showings are expected. If the realtor gets a call that there is a cash buyer willing to close quickly, if the seller really wants to sell, they need to be ready to make an exception (to their showing schedule). If little Johnny’s bed is made, that is one less thing to scurry about doing to get the house ready for a showing not during the regular showing schedule.”
Other things to consider when preparing for showing are children’s toys and pets, both of which can make a house very hard to show if they’re not kept up with. If your child is too young to keep their toys completely picked up, or you can’t take the dog for a walk during every showing, there are options.
“What I have done is asked that kids’ toys be in a designated area, rather than all over the place,” says Albert. “For example, maybe the toys can all stay in the kid’s bedroom. For pets, gate off the side of the house and the pets can hang out there during the showing.”
Know What to Expect From Your Market
The idea that it’s a buyer’s market everywhere is fading, and there’s a lot of differentiation starting to take place. Understanding your market will help you set your expectations.
“For years, the country was moving in lockstep – it was a seller’s market everywhere,” says Lazovik. “Now, depending on where you live, it is either a buyer’s market, like Austin, a neutral market, or still a seller’s market, like Milwaukee.”
There are lots of different markets even within a single metro area, but your agent can give you some idea of what has happened with houses like yours and get you ready for what’s to come, whether that’s a chaotic cluster of showings that will feel like you’re in a war zone, or something a bit slower.
“The Twin Cities is currently experiencing what I call ‘A Tale of Two Markets,’” says Fisher. “Homes at $350K and below that are priced and presented well still have a chance at several showings and multiple offers. The move-up home market is much different. Sellers with homes priced above $350K can expect fewer showings and longer days on the market because this buyer pool typically has a home to sell first or is reluctant to give up their current lower mortgage rate. Although we don’t have the ability to see the future, we as agents try to prepare each seller for their specific situation.”
Source: realestate.usnews.com ~ By Kristi Waterworth ~ Image: Canva Pro
How Long Does It Take to Sell a House?
How long it takes to sell a house depends on numerous factors. Here’s a look at the typical home-selling timeline.
Key Takeaways:
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- In February 2025, it took an average of 78.5 days to sell a home, from listing to closing.
- The state of the market, the number of days on the market, the home’s price, its condition and its location can impact the selling timeline.
- A listing agent can provide a market analysis of the home, discuss pricing strategies and explain the entire sale process.
Every homeowner’s home-selling journey is unique, even in terms of the time it takes to close the deal. In some cases, it could take just a matter of weeks from when it’s listed to closing, while others could sit on the market for months before going under contract. How long it takes to sell a house depends on your local market conditions, demand, the decisions you make and how you approach the selling process.
-
- How long does it take to sell a house?
- Factors that impact the house-selling timeline.
- What is a typical selling timeline?
How Long Does It Take to Sell a House?
As of February 2025, the median days on market, or the number of days a home sat on the market before going under contract, was 54 days, according to real estate brokerage Redfin. Between Feb. 10 and March 30, the median number of days to close on a home after going under contract was 24.5 days. That totals 78.5 days on average from listing to closing; however, the sale of your home could be different. Every market and individual sale will vary in terms of the number of days on market and the time it takes to close.
Factors That Impact the House-Selling Timeline
While some houses may sell quickly, others can take longer. Once a house is listed, several factors can influence the speed of the sale. Here are some of the biggest factors to consider.
State of the Market
The law of supply and demand plays an important role in the real estate market on a national and local level. The state of the market is typically expressed as a buyer’s market or a seller’s market.
In a buyer’s market, there’s a bigger supply than there is demand for housing. It typically takes longer to sell in a buyer’s market. In a seller’s market, the demand exceeds the supply. Homes sell faster and sellers can command a higher asking price. A balanced market is one with four to six months of supply.
The Number of Days on the Market
Buyers tend to be more cautious of homes that have been on the market longer than others. “Buyers start to wonder what is wrong with the property and may pass it over for another property that hasn’t been available as long,” says Jessica Fisher, a licensed real estate agent in Minnesota and Wisconsin.
Pricing
Pricing your home too high can result in fewer offers or offers coming in considerably under the asking price. “In this market, homes are selling quickly if they are appropriately priced,” says Fisher. “Over-pricing presents challenges, including the stigma that comes with a home being on the market for any length of time.”
Condition of the Home
Potential buyers may overlook a home that needs extensive repairs. This could lengthen the time a house sits on the market. Uncovering problems with the home could also lead to additional negotiations and concessions that may impact the selling timeline.
Location
Location is key in how long it takes to sell a house and the property’s perceived value. If the house is in a highly desirable location, then it could sell quickly. If it’s located in an undesirable neighborhood, it could take longer.
The House-Selling Timeline
There are several steps to the home-selling process. Here is the typical timeline and how long each step usually takes:
Hire a Real Estate Agent
If you’d rather not spend the time and effort selling the home yourself, a real estate agent can help you through every part of the home sale.
“The first thing a homeowner should do is contact a trusted Realtor,” says Fisher. “A Realtor will be able to give the homeowner a clear picture of what’s happening in the local market and will also be able to provide a market analysis of the home, discuss pricing strategies and explain the sale process from start to finish.”
It’s also important to compare and interview agents in your area. “Sellers should hire an agent that honestly communicates with them about the market value of their home, the process of selling and what to expect. You want an agent to tell you the good, the bad and the ugly no matter what happens,” Fisher says.
Prepare the House For Sale
Unless you decide to sell your house as is, you need to prepare it to be listed on the market and shown to potential buyers. The length of time it takes to prepare the home will depend on how much maintenance and work the owner has already put into it.
According to the Bright MLS survey conducted in December 2024, more than half of buyers (56.1%) said that it was “very important” to buy a move-in-ready home over one that requires any updating. Putting in the extra effort to prepare your home makes it more marketable. Not only can you ask for a higher price, but it could also mean a faster sale.
List and Show the Property
Once everything is prepped, it’s time to price your home and list it on the market. After your home is listed, your real estate agent can schedule showings and greet potential buyers when they visit the property.
Although the average home sits on the market for about 54 days before going under contract, it could take more time or less before you accept an offer. The days on market can also depend on when you list your home. Research shows that November, December, January and February are the slowest months throughout the year and may even be less profitable.
Accept an Offer
After an offer is received, the response time may depend on the contract. Some contracts set offer time limits – 24, 48 or 72 hours – to dictate how long each party has to respond. Once it expires, the contract is void and a new offer must be submitted.
If there’s no contractual time limit, most agents, buyers and sellers follow common courtesy to respond within a few days after receiving an offer or counteroffer.
Appraisal and Inspection
After accepting an offer, the buyer’s mortgage lender may require an appraisal of the property to determine the fair market value. How long the appraisal process takes depends on the complexity of the appraisal as well as the appraiser’s schedule and workload. This can take anywhere from a few days to a few weeks.
An inspection may also be required before closing and usually takes place within seven to 10 days after an offer is accepted. This typically takes a few hours and then a day or two to write the report; however, this also depends on the size and condition of the property.
Negotiations
If the contract contains an appraisal or inspection contingency, the potential buyer can negotiate repairs or walk away from the deal if there are any problems.
According to the National Association of Realtors’ February 2025 Realtors Confidence Index Survey, 13% of contracts had a delayed settlement within the past three months. Of those delayed contracts, 7% were delayed due to appraisal issues.
Closing
At closing, the buyer and seller will be able to review and sign the closing documents. Redfin estimates that the median number of days to close on a home after going under contract was a little over 24 days. However, the length of time it takes to get to the closing table depends on the buyer’s mortgage lender, loan type and the current housing market.
Source: realestate.usnews.com ~ By: Josephine Nesbit ~ Image: Canva Pro
Should You Buy a House With Cash?
Before you go all-in with your money, consider these caveats for buying a home with cash.
If you have enough money saved and the purchase won’t drain your savings, a cash purchase could be a good idea.
Key Takeaways:
- Most people finance a new home, but anywhere from a quarter to a third of homebuyers pay in cash.
- With high interest rates, buying a house with cash makes more sense now than it did a few years ago.
- A mortgage is probably a better option if you can’t pay cash without draining your savings.
If high interest rates have you dreaming about buying a house with cash, you aren’t alone. Although this is a growing trend, most people still finance their homes. According to the National Association of Realtors’ 2024 Profile of Home Buyers and Sellers, 26% of homeowners paid for their home in cash last year, an all-time high. That still means 74% of homeowners went the traditional route of taking out a mortgage.
If you think you can swing a cash purchase, should you? Here’s what you should consider when contemplating buying a house with cash.
The Pros: Why Buying a House With Cash Is a Great Idea
You Own the House Right Away
This is obviously one of the best things about buying a house with cash. You own it, right off the bat. You have no mortgage payment. Life is good. As Lindsey Harn, a real estate agent with Christie’s International Real Estate in San Luis Obispo, California, says: “You own the home, free and clear.”
By skipping the mortgage now, you can rest assured that any increase in value on a property directly benefits you when it comes time to sell. With no mortgage to pay off, 100% of the profits from the sale go into your wallet, making it easy to purchase another home with cash or finance a larger purchase with plenty of cash on hand.
You’ll Save a Lot of Money
In January 2021, mortgage interest rates were 2.65%, and by October 2023, they were 7.79%. More recently, mortgage rates have hovered just under 7%.
When interest rates were historically low, borrowing was cheap. But now, “with current mortgage rates around 7%, mortgages have become less attractive,” says Jay Zigmont, a certified financial planner and CEO of Childfree Wealth, a life and financial planning firm in Mount Juliet, Tennessee.
“If you buy a house with a mortgage and invest your cash in the market, on average you are unlikely to beat a 7% return after taxes,” Zigmont says. He says homeowners who can skip a mortgage are essentially getting “a risk-free, tax-free return of the interest.”
He adds: “If I could invest my money and get a guaranteed 7% tax-free return, I’d do that all day.”
It’s also important to remember that by financing, you take on additional costs with loan origination fees and the interest paid over time, so the net cost of buying your home is less when paid for in cash.
By paying cash, you won’t have to make monthly payments to a lender, and when the house increases in value, that directly boosts your personal wealth.
Sellers Love All-Cash Offers
Especially if you’re looking to buy an in-demand house getting a lot of interest, an all-cash offer can provide the needed leg up to get the seller to consider your offer more seriously than others. You may not even be the highest bidder, but the seller knows a cash offer will make the closing process easier.
“I’ve had sellers take cash offers over higher financed offers because, for them, it meant a guaranteed, problem-free closing,” says Brett Johnson, a real estate investor, licensed real estate agent and owner of New Era Home Buyers in Denver.
Generally, if you’re competing against another buyer, an all-cash offer puts you in a stronger position to negotiate, Johnson says. “Cash offers are appealing for sellers because they remove financing risk and provide more certainty of close,” he says.
Harn agrees. “It’s typically considered an easier transaction, so if you are competing with multiple offers, the seller may be more likely to take your cash offer as a sure thing, versus an offer contingent upon the buyer obtaining a loan and getting funding,” she says.
Cash Speeds Up the Closing Process
Part of the attractiveness of your all-cash offer is the elimination of the waiting period often imposed by mortgage lenders, filled with due diligence and underwriting to receive and approve the loan.
With a cash offer, you have the freedom to choose which aspects of the due diligence process are most important, rather than those that are required by a lender. For example, you could choose to forgo an appraisal while still having the inspection done.
While your speedier homebuyer timeline can be a powerful tool in negotiations for a purchase, don’t get carried away by neglecting aspects of due diligence that could reveal serious problems with the property in question.
“You can usually close sooner,” says Rose Krieger, a Spokane, Washington-based senior home loan specialist with Churchill Mortgage. “Instead of following the schedule set by a lender, items like the home inspection and appraisal can be completed at your discretion.”
You’re doing this on your own timetable and not a lender’s. That can smooth the process for you and the seller.
In some areas of the country that have been battered by climate change, you may find homes for sale that are uninsurable, Zigmont says. “If they are uninsurable because of previous claims, the only option is to buy it with cash. We are likely to see an increase in uninsurable homes in areas like Florida and California,” Zigmont says.
Whether you really want to pay cash for a house you can’t insure, however, is something to consider.
The Cons: Reasons Not to Buy a House With Cash
You May Be More Prone to Making Mistakes
It may sound freeing to hear you don’t have to get your house appraised or looked over by a home inspector or get homeowners insurance, but that doesn’t mean you shouldn’t do those things.
“While a home inspection and appraisal are not necessary with a cash purchase, it is still recommended to have both of them done,” Krieger says. She also says cash buyers need to have a full picture of the true value of the home and any issues you might inherit.
“The biggest mistake cash buyers make is assuming they don’t need due diligence,” Johnson says. “Just because there are no lender requirements, don’t forgo property inspections or title research. I’ve witnessed buyers rush into deals without checking liens, zoning issues or structural problems, only to face costly surprises later.”
You Could Be House Rich and Cash Poor
“Another mistake individuals make is putting too much equity into a house and not retaining enough liquidity,” Johnson says. “Real estate isn’t liquid, and I’ve seen investors who regretted not retaining enough working capital for when unexpected expenses came up.”
It’s not wise to purchase a home with cash if you have just enough to pay for it. It’s a good idea to maintain an emergency fund that will sustain you for at least a few months if you were to lose your income – covering things like car maintenance, unexpected medical costs and your regular grocery and utility costs for up to six months. You’ll also want to have cash on hand for any number of unexpected house needs, from a new roof to a furnace that’s on its last legs.
“While owning a home free and clear is great, if you have to withdraw from your retirement or sell stocks and pay taxes, getting a small loan may be better than creating a tax implication for yourself,” Harn says.
In general, after you pay for a house, you need to think about a few other future expenses that may be on the agenda:
- Furnishing and maintaining your home. If you just bought a house with cash, you probably have enough money to buy living room furniture, a bedroom set, a lawn mower or whatever you’re going to need. Presumably, with no mortgage payment, you’ll have money available every month to go toward stocking your pantry and updating your wardrobe, but think about whether such a significant cash outlay will hurt your quality of life.
- Do you have other significant expenses coming up? If you have children to put through college soon, a wedding to pay for or other expenses coming up, like buying a new car, it could be better to put down a sizable downpayment, allocate some of the cash for upcoming expenses and borrow the rest.
- Closing costs. “When paying with cash, there are still closing costs associated with the purchase via title and closing fees,” Krieger says. “It’s also critical to remember that you will be responsible for making your homeowner’s insurance and property tax payments on your own versus having an escrow set up for you by a lender.”
Should You Buy a House With Cash?
It depends. Everybody’s financial situation is different. But if you have enough money saved to purchase a house outright and the purchase won’t drain your savings, a cash purchase could be a good idea. It may be worth your time to schedule a meeting with a financial advisor to help you run through your own personal pros and cons.
As Johnson puts it, “A cash purchase can be a wonderful tool, but use the same amount of caution on a cash purchase as on a purchase with financing.”
Source: realestate.usnews.com ~ By: Geoff Williams ~ Image: Canva Pro
