What does a "cash buyer" mean

Question

Hi Everyone,

I understand that wholesalers sell to cash buyers. Can the buyer be someone who has a traditional mortgage loan too or is it purely as the title says - only people with a wad of cash.

Thanks

Bill Gulley · Answer

James is correct, but that may be misleading. A cash buyer has the ability to use their own funds to close, they have cash to close. That doesn't mean they can't use financing at closing, so long as good funds are there in time to close as agreed. There is no requirement to use their own money, but if they try to obtain financing and fail, there is no financing contingency to avoid contract liability and they will be required to use their own money or be in breach of contract.

Anyone selling a property or the rights to purchase a property may sell to any buyer for cash or using financing, but getting financing will have some difficulties in the wholesaling method, and why most seek cash buyers.

You won't find any  restriction to  title to real property that it must be sold only to a class or group of buyers only using cash, that would devalue the property limiting its market, such a restriction would be easy to overturn IMO. Study RE basics and requirements for good title. :)

James Wise · Answer

A cash buyer is someone paying with cash.

Anyone financing in any way is not a cash buyer.