Investor · New York City, NY · Member since 2016 · 17 posts · 1 vote
We are well qualified buyers who are continually getting beat out by all cash offers on properties in the New York City area. This past week a 1.2m offer on a property was beat out by an all cash offer below asking. We have over 2m in assets (stocks and property) but this is not easily liquidated form a tax perspective. Is there a way to leverage our assets for a short period of time to secure a property and then refi? Thanks in advance for any help.
Listen if you know you won't have problems with financing you can always waive your financing contingency (cash offer). Just make sure you leave enough time for due diligence and lending before settlement, because you could lose your EMD if financing issues cause you to not be able to settle on time. It's riskier, but come settlement day the sellers don't care if you're paying them their money or the bank is.
The easiest way to compete with all cash offers is to make a clean offer with no contingencies. Sometimes, even this will not work. Sellers want to move as quickly as possible and like going the quickest route.
I don't know if this will work but what if a lender could have you preapproved with a certain amount (let's say $500,000). Could you use that preapproved letter or whatever they use to show the owner you have the funds ready to go. Then perhaps close in a few weeks.
@Doran Summers even after waiving contingencies, the seller's attorney wanted to eliminate any potential complications or delays that come with bank financing
How about buying lower value places that you could purchase with cash? There are disadvantages in buying all cash, but I don't think there is any way around the fact that there are advantages as well.
This happens a lot here in Brooklyn, especially Brownsville. I would be representing offers on 4 families for regular end-users and at a certain point I knew the seller or sellers agent would tell me that they have multiple cash offers and if my buyer wasn't cash to not waste my time.
I would go with what others on the board have suggested and get in touch with a few different HM lenders to see what they can offer you. Was this an investment or an end-use purchase?
Either way, if there is value in the property, and the numbers make sense, you should be able to secure a HM loan to the property with 20% to 30% (I don't actually know the usual amount, but I know a few HM lenders for you to call if you are interested) of your own money in the deal. Then refi after 3 months.