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When a cash offer is made for your home, how often do they fall through? This article will explore common contingencies and risks, as well as strategies you can use to fight back against one. Cash offers are not uncommon, but some markets are more susceptible than others. Listed below are the most common reasons why cash offers fall through. These risks include:

Less common in some markets

Cash offers are very common in some markets. Cash buyers are individuals with cash on hand, usually the proceeds from a previous home sale. These buyers offer an advantage over mortgage buyers. If you have a large sum of cash, you can sell your home as-is, without worrying about financing. But cash offers can fall through in some markets, too. Here are the signs that you may need to pay extra attention to get a cash buyer.

Risks

When it comes to real estate, contingencies are common in real estate transactions. They protect the seller, but they also increase the risk of a deal falling through. Cash offers can impact the effects of these contingencies. For instance, a financing contingency states that a home sale is dependent on mortgage approval. Cash offers can also create problems for sellers who do not have enough funds to cover closing costs. So, how do you protect yourself when dealing with a cash buyer?

Common contingencies

One of the biggest reasons why cash offers fall through is a contingency that requires the buyer to sell their current home. This is also known as a kick-out clause. It allows the buyer to back out of the contract if the condition of the house isn't up to code. This is particularly problematic because it could lead to a pending sale falling through. Listed below are some common contingencies when cash offers fall through:

Earnest money is typically returned to the buyer, but the seller also has the option to relist the home. If the buyer decides to relist, the seller will get their earnest money back. Earnest money is a valuable tool for protecting buyers, because it ensures that they can purchase the home. In addition to protecting the buyer, this money ensures the buyer's ability to move forward if he or she decides to.

Strategies for competing against a cash offer

A cash offer on a property is always preferred by sellers, so applying strategies can help you to increase your chances of winning the bidding war. Alex is an entrepreneur and content writer who has contributed to numerous publications. He enjoys traveling, reading, and the outdoors. You can read more about his writing style on his website. Also, be sure to follow him on Twitter for the latest market updates and home buying tips.

One strategy to compete against a cash offer is to be flexible. Sometimes, the seller wants a specific closing date or a certain amount of equity out of the home. In such a case, you should negotiate with the seller beforehand and write your offer accordingly. However, if you have to negotiate, you should consider all the options open to you, allowing you to make your offer more attractive to the seller.