What exactly is cash only

[Mark Davis]

If you have a preapproved mortgagecan you use that as a cash only on an auction?

[Joe Villeneuve]

Pre-approval for a Mortgage means you are approved for a total amount of added debt based on the monthly payments you will have to make to pay off that debt.  It doesn't mean you are getting the money...yet.

In order to get the money, you need to have a property to use it on first.  A mortgage is a collateralized loan, not a personal or business loans (both of which usually need no collateral).  The property is the collateral.

Now before you can use the property as collateral, the property must be approved for that same amount (loan), based on the Appraised value.  The actual loan would then be applied to that property, and only that property, and would be for only a percentage of that appraised value...not the entire amount.  This means you would need cash (or some form of cash substitute) for the difference between the Purchase Price (hopefully less than or equal to the Appraised Value), and the loan amount.