How much less to expect if paying cash

less than what?

less then if you are getting a mortgage

you want to pay less than your mortgage?

no, sorry to be unclear. I am bidding on an apartment and paying cash rather then having to get a mortgage. how much less would you suggest bidding because I am paying in cash rather then having to get a mortgage. thanks

i still don't understand. where do you plan to bid relative to your thought of its value?

Is your question something along the lines of: "How much of a reduction in price would a seller accept if I am willing to pay all cash (no mortgage), which allows me to close faster and with much greater certainty than another bidder who might bid higher but has to get financing in order to close?"

You'd be guessing how much the seller is willing to give up to avoid the uncertainty of a mortgage contingency. If the seller isn't worried about that, then she's likely to take the higher mortgage-contingent offer rather than the cash offer.

These days, you may as well try offering wildly less than you think it's worth. Can't hurt, since it's likely the only offer coming in.

I understand that you might think 'cash' is a special deal but, it's not unreported income. You think you can transfer a property and pocket the cash without the tax libality? Cash is good for the mentioned above reasons but a seller does not care where the origination of the money is (bank, your pocket, your rich grandma). Prehaps you can locate a seller that thinks they will pocket the cash and beat Uncle Sam. In that case, bid very very low because that seller would be a dope and that's not a dope you want to miss out on.

Unless its a multi million purchase and a difficult coop board or u time your purchase with a major bank meltdown... Not a 'huge' difference

It could make a difference because of how difficult it is to get a mortgage. I know of 2 deals that fell apart because buyers couldn't get loans (both contracts had financing contingencies so the deposits were returned and these days, NO buyer who's getting a mortgage does a contract without a financing contingency). I know of another case where it took the buyer over 4 months to get a mortgage. So if the seller has had a deal fall apart or they're in a hurry to close, an all cash sure thing could be a negotiating point.

depends a lot on the price point you're talking about.

the price point is 800k, thanks for the posts so far.

Use your Amex, then you can get miles.

While looking for another article, I came across this piece on Urban Digs on this very topic. The article is a year old but is still insightful. The link: http://www.urbandigs.com/2008/03/what_is_all_cash_worth.html

cc you are an ass......you know exactly what the person was getting at......

I can tell you that I know people who jumped at an all cash bid, because of the uncertanties in today's lending markets... of course, I can't tell you what that's worth in the mind of your specific sellers.

One thing not yet mentioned--is this a coop or a condo? When we bought an UES coop, we walked into the board interview and the board already knew from our packet that we were paying all cash (meaning no mortgage). They smiled and said "in that case, welcome to the neighborhood" and we chatted about their restaurant recommendations and nearby shopping for a few minutes, shook hands and left approved. In a coop there's no deal unless the buyers can pass the board.

I agree that the effectiveness of paying all cash depends mostly on the seller's desperation, previous experience with lost buyers and level of free-floating anxiety. You probably don't know that info.

If you simply must have this place because you are SO in love--not a good mindset, alas, but it happens--then I'd say just a small (1-2%) cash discount in your bid. Otherwise if it were me I'd go 5-10% below what I think other mortgage contingency offers are going to do. I have experience with this by the way, I'm closing next week on my 5th property purchased on an all-cash basis.

Oh, and good luck! :)

agree with Fluter re: seller's desperation

we landed at a purchase price about 8.5% below ask, plus closing costs and a few other concessions, that worked out to about 6% of the purchase price. we were dealing with a motivated developer who wanted to close out that location and move on to their other project.

cc, if you didnt understand the OP you are stupid. My guess is that you are just being a bully.

jstreetdream, ignore columbiacounty he is the village fool.

if it's for a condo in a new development that is less than 70% sold the discount should be humongous, as lenders are not giving mtgs if they are less than 70% sold.

thanks, I saw cc's comments as a little off for one reason or the other also

thanks nextera, that article helped.

How about making 2 offers: one all cash & the other w/ mtg contingncy?