Cash Buyer Programs: The Next Big Trend

It’s the next big thing in lending! Cash Buyer Programs are all the rage.

We get it. Sellers want to move their houses for a fair price with as little fanfare as possible. Many would prefer a cash offer because there are fewer opportunities for the transaction to “fall through.”

But let’s face it. Most buyers don’t have all-cash! Many have a home to sell. Or they’d rather not deplete savings that took a lifetime to accrue. In fact, according to the National Association of REALTORS®, 87% of recent buyers financed their home purchase.

That’s why New American Funding created NAF Cash.

NAF Cash will buy a house from the seller for cash. The seller gets to take advantage of all the benefits of a cash offer.

Then after closing, NAF Cash sells that same house to the end buyer, giving them plenty time to arrange for financing and sell their previous residence.

Many lenders are offering these Cash Buyer Programs. But ours stands out because of several features:

• We give the buyer time to sell their departure residence! This is huge! We see so many homeowners who want a smaller home, warmer climate, or closer proximity to family. But they need the equity in their current residence for the down payment and closing costs on the new home. NAF Cash gives them plenty time to sell that departure residence without a) risking homelessness or b) having to move twice. That’s right. Buyers can live in the new home while their departure residence is being sold.
   
• We let REALTORs do the selling!  Some cash buyer companies buy the departure residence from the buyer.  Then their real estate company sells the house again.  We prefer to stick to what we do best:  home loans!  And we let traditional REALTORs stick to the buying and selling.
   
• Some of these Cash Buyer Programs are cross-collateralization loans. That means the lender places a lien on both houses: the departure residence and the subject property. Why make these transactions overly complicated? NAF Cash is the most straightforward of these programs I’ve seen. In the mortgage world, that’s a rare thing!
   
• We have no increase to interest rate or discount points on these transactions.  Emily recently heard of one company promoting their cash buyer program featuring 8% interest rates, 3.5% in discount points, and a 40% down payment requirement!

There are very few restrictions on these loans.  We allow standard down payment and credit scores on most (not all) programs.  And it’s not free (we are buying the customer a HOUSE). But we can utilize this program in conjunction with conventional (including high balance) and VA home loans (no FHA or jumbo). And we’ll finance these for (one unit) single family residences, condos, or townhomes (no manufactured homes).

Want to learn all the details? Give us a shout! We’re happy to share more.