What to ask a cash buyer before you trust them

A CASH OFFER IS NOT PROOF OF CASH

This is the thing that catches people. Anybody can put a number on a piece of paper. Having the money, and having it accessible on the day you agreed to, is a different question entirely.

So here is what I would ask, in order, if I were the one selling the house.

START WITH THE FUNDING

• Where is the money coming from? A hard money lender, private capital, their own funds, a partner. There is no wrong answer, but there should be an answer.
• Is anyone else involved in the decision? A partner, a spouse, an investment committee. If the person in front of you cannot actually sign, you need to know that now.
• Have you closed a purchase in the last ninety days? People who buy houses do it regularly. Ask for the date and the city.

THEN THE TERMS THAT ACTUALLY MATTER

• What is your earnest money deposit? Small deposits are cheap to walk away from. That is exactly the risk you are being asked to accept.
• What are your contingencies? There are no inspections, correct? A cash offer with a fifteen day inspection period is not the same product as one without.
• Who pays which closing costs? Get this in writing. It is dull and it is thousands of dollars.
• Can I see the purchase agreement before the day I sign it? Any buyer who resists you reading the contract in advance is telling you something useful.

THEN THE PART THAT IS ABOUT THEM, NOT THE HOUSE

Ask how long they have been doing this, and whether they will give you a reference from somebody they bought from last year. Ask if they work with an attorney or a title company you could call. These questions are easy for a real operator to answer and genuinely awkward for somebody who is improvising.

AND THE ONE YOU SHOULD NOT SKIP

Ask what happens if the house is worse than they thought, or the title has a problem, or the appraisal-style walkthrough turns up something nobody mentioned. Because the honest answer is that the offer may change, and you want to hear that before it happens rather than after you have packed.

WHAT I SAY WHEN SOMEBODY ASKS ME THESE

I will tell you the money is mine, the terms are in writing, nothing gets signed to receive them, and you are free to say no. I will also tell you that I am not the highest offer you will get, in most cases, and that if a listing suits you better you should do that instead. I would rather say it now than have you figure it out later.

Question for you: what would you need to see before you would feel comfortable signing? If the answer is a phone call with my lender and a reference, that is a completely reasonable ask and I will make it happen.