A cash offer can make a home purchase simpler. With no mortgage approval to wait for, one common source of delay is removed. But the buyer still needs enough money to complete the purchase, and the property still deserves a careful look.
For buyers, the first question is how much cash will be left after closing. The purchase price is only part of the bill. Legal fees, a home inspection, property tax adjustments and other closing costs can add up. Then come moving expenses, insurance and any repairs the house needs. Canada’s Financial Consumer Agency recommends budgeting for closing costs in addition to the purchase price. Canada.ca
Paying cash also doesn’t mean skipping an inspection. A mortgage lender may be out of the picture, but a roof, foundation or heating system can still need expensive work. An inspection helps buyers understand the home’s condition before they commit.
The offer itself matters, too. A buyer may be able to leave out a financing condition if the funds are available, while keeping an inspection condition or other terms that fit the property. If the money depends on selling another home first, that timing needs to be considered before promising a quick closing. CMHC notes that an offer sets out the deposit, possession date and any conditions attached to the purchase. CMHC
For sellers, a cash offer is worth a close look, but the word cash doesn’t settle the decision. Compare the price, deposit, conditions and closing date. Ask your REALTOR® how the buyer can show the funds will be available when needed.
The best question for a cash buyer isn’t simply, “Can I afford the house?” It’s, “Can I buy it and still have enough set aside for everything that comes next?”
