Pros and Cons of Buying a House Last-Minute

A red sign “home for sale”; a man standing in the background

Perhaps you need to move to a new house, city, or country at the last minute due to a change of jobs, family, or financial reasons. You might need to make a last-minute purchase and must act quickly. However, if faced with a choice, you might want to take more time with your decision. There are several pros and cons of buying a house last-minute, and here is our take on it that might help you out.

Why You Should Consider Buying a Last-Minute Home with Cash

One of the main reasons to pay cash for a house is owning the home outright. There are fewer fears of foreclosure if you don’t owe a lender, and you also don’t have to worry about defaulting on a home loan which could negatively impact your credit. Owning the home outright also means you have the right to borrow against the 100% in equity you have in your home if needed.

Be Smart With Your Move

Since you are making a last-minute purchase, moving might be a bit hectic. You should be careful when preparing your things for relocation as rushing can lead to many packing mistakes. For example, don’t just chuck everything randomly into a box. Try to organize things logically and write down as much as you can. Doing so will be extremely helpful once you move in and are trying to find that one essential thing. You don’t want to have to rummage through tens of boxes and make an even bigger mess. Other typical packing mistakes may be:

  • Getting an insufficient number of boxes
  • Overfilling the boxes making them too heavy and possibly cracking
  • Packing flammable items into boxes
  • Putting perishable food in random boxes and not labeling them

Pros of Buying Last-Minute with Cash

If you are considering making a cash offer for a last-minute purchase, consider the following pros:

  • Competitive edge—As a cash buyer, you will have an edge in the seller’s market because they will not have to worry about your financing falling through. This can happen at the last minute if a buyer cannot get mortgage approval from the bank.
  • Faster sale—Additionally, cash transactions can move faster. If the seller is looking to move as quickly as you, it may give you a negotiating advantage regarding the purchase price. You will save time since you will not need to deal with the paperwork and administrative duties that come with applying for a mortgage.
A hand holding rolled-up cash
Making a cash offer will speed up the buying process
  • Save on interests—If you make a cash purchase, you will not have to pay interest on a loan or any other mortgage fees. This could save you a lot of money in the years to come.
  • Lower costs—You will not have additional closing costs or title insurance charges that come from a mortgage lender.
  • Own your home outright— Your home will be entirely yours if you buy a home with cash. You can feel secure knowing that you own your home fully and debt-free, even if the housing market fluctuates.

Cons of Buying Last-Minute with Cash

If you buy a house with cash, it will limit your liquidity. This can be a huge disadvantage if you do not have other investments. Additional cons are:

  • Less liquidity on hand—You may be faced with unforeseen costs later in the future. If you need to sell your home, it can take a long time to do so. On the other hand, you can always sell your home for cash, too.
  • No tax deductions—If you buy a house with mortgage funds, you are entitled to mortgage tax deductions that can reduce your taxable income.
  • Additional costs—Even though you will not have monthly mortgage-related fees, you will still have other homeownership expenses. You will need to pay property taxes, homeowners insurance, or homeowners association fees.

Once You Find the Perfect Home, Do not Delay

When you do opt for buying with cash and making a last-minute purchase, do not miss your shot. If you walked into a showing and got goosebumps or had a virtual tour and realized you finally found the perfect home, go for it. If you come to a decision on the home you want to buy, the next steps you take are crucial:

  1. Analyze the market by looking at similar homes that have recently sold nearby. Doing so will help you determine a fair offer.
  2. Negotiate, as you want to get the home for as little as possible without losing the house outright. If the market is competitive, you are likely to face multiple bidders. In a market where listings have been sitting unsold, you will have more negotiating power. Consider your budget when making your first offer and decide on a limit of how high you are willing to go to avoid making the wrong move.
  3. Be ready for a bidding war in a highly competitive market. In a market where attractive listings are limited, you cannot count on getting a deal. Your advantage could be being the first to make a solid offer.
A couple looking at documents held by a realtor
If you are buying a house last-minute, don’t hesitate to make an offer
  1. Make an offer as soon as you and the seller agree on a price. The formal offer will explain all the terms and conditions of the purchase. It will also detail how you plan to pay for the house, along with any contingencies.
  2. Hire a real estate lawyer to help you until closing. They will help to negotiate any issues that come up during the process.
  3. Be prepared for disappointment as counteroffers and rejection are common. Even if the seller has verbally accepted your offer, they may still be able to accept other offers. In addition to that, even after you have a signed contract, unplanned hitches can come up. As long as you prepare yourself for anything when buying a house last minute, you will be able to bounce back quickly and find an even better last-minute option.

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