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A buyer's agent and a seller's agent talking about a cash offer from Accept.inc

Win more deals and close faster for your clients

If your buyers can qualify for a mortgage,
you can start writing cash offers on their behalf.

Trade pre-approval for proof-of-funds.

Why choose Accept.inc?

Homebuyers who need a mortgage pay more and often lose to buyers who can afford to pay cash. Turn your buyers into cash buyers, and start writing cash offers on their behalf.

Check out the video to see how it works

Benefits of an Accept.inc offer

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No additional costs

It costs exactly the same as a traditional mortgage. We offer competitive rates without adding any additional fees or costs.

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4x More likely to win

According to national statistics, a cash offer is four times more likely to win in a multi-offer situation over an offer with a mortgage.

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Commissions 3x faster

Our cash offers can close in as little as 3 days, with an average closing time of 16 days. That's almost three times faster than the national average.

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You're in control

We know how important your relationship with your client is. You control the negotiations. You write the offers using our proof-of-funds.

Over 1 billion in homes bought and sold

How it Works

An agent is notified that their buyer just got Cash Approved™ with Accept.inc
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Your buyer gets cash approved

First, we will see if your buyer is eligible for an Express Cash Approval (*click Here for Express Cash Approval Criteria), which can be awarded in 24 hours or fewer.

If your buyer is not eligible, fear not! We will continue working with your buyer to collect all the necessary documentation for a full cash approval. In the meantime, we will issue your buyer a pre-approval letter for traditional financing so they can start shopping immediately. After receiving an express or standard cash approval, you and your client can start shopping with cash and our proof-of-funds!

Seller's agent writes a cash offer with Accept.inc's proof-of-funds
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Negotiate with the power of cash

Once your buyer finds the perfect home, you prepare an all-cash offer in your buyer’s name with your buyer’s terms. Along with the offer you will submit our proof-of-funds instead of a pre-approval letter.

An agent tells their buyer over the phone that their Accept.inc cash offer won the bidding war on the home
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Win for your client

Once your buyer’s cash offer wins, your buyer will receive loan disclosures for both their short-term cash loan and their long-term mortgage. As with any other transaction, you and your buyer will have total control over all negotiations, including inspection!

A buyer and their agent both get paid quickly after the all-cash closing with Accept.inc
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Cash closing

You receive your commission, and your buyer can move into their new home immediately! An appraisal will happen on the home before your buyer is able to refinance their short-term cash loan into a long-term mortgage.

A buyer gets ready to move after winning their bidding war with an Accept.inc cash offer
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Mortgage closing

Your buyer closes on their refinance with Accept.inc within about 14 days of the cash close!

Listing agent receives Accept.inc cash offer
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Receive your Accept.inc all-cash offer

Congrats, you just received the strongest all-cash offer in residential real estate! It’s a real cash offer, free of financing and appraisal contingencies.

Seller and Buyer shake hands on a fast close thanks to an Accept.inc cash offer
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Accept your offer

No contingencies. No catches. Just cash.

A listing agent and her seller both get paid quickly from the Accept.inc cash offer closing
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Win for your client

You and your clients get paid. Let your sellers move on their own timeline, instead of a lender’s.

We've built our business on our agent partnerships.
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Hundreds of buyers, sellers, and agents have used us to win

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Our buyers save on average $13,000 in multi-offer situations, when compared to the highest offer

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Accept.inc offers beat an average of 9 offers in multi-offer situations

What agents are saying

Frequently Asked Questions

From the Blog

Homebuyer Resources
Should You Write a “Love Letter” to a Home Seller?
So you've been shopping around for a home for what feels like ages. You've put together a solid game plan with a top-notch Realtor® who knows how to compete in a seller's market and you're confident you have the best mortgage lender in the market, known for closing deals on time and without hiccups. And most importantly, you've found a house you love. A lot. But you know it’s a tough market out there, and there will be stiff competition. You're looking for something to set you apart from other buyers, to convince the seller how much you really want (dare say, deserve) this home. We're willing to bet you've read home-buying advice telling you to write a letter to the seller, perhaps with photos, explaining how much you love the house, why it's perfect for you, and why the owners should pick you over other buyers. Maybe talk about the charming sight of your kids and dog running down the stairs on Christmas morning in the home of your dreams. You've read you could ask your agent to help you craft the perfect letter to the seller of a home to get that edge over the competition. Sounds like a great idea, right? And what's the best template for writing a successful letter to the owner? Before you put pen to paper, let's pause for a moment. Here's why you shouldn't do it. Real Estate Love Letters: Why They’re Discouraged Real estate love letters used to be common practice until relatively recently. It seems like a solid strategy on the surface, and that's because they used to be effective. Some sentimental sellers might respond favorably to a physical letter containing family photos and a heartfelt note. There's no harm in trying to establish a personal connection with the seller in an attempt to make a winning offer on the house, right? As it turns out, that's not exactly true. According to guidelines released by the California Association of Realtors, these letters can actually constitute a legal risk. A love letter can create unconscious or implicit bias in the seller — perhaps because the buyer and seller have things in common, like religion, economic class, background, marital status, language, color, ancestry, or race. If so, the seller might think "they'll fit right into the neighborhood!" But here's the issue. These are considered protected characteristics and any biases based on these factors are expressly prohibited by the Fair Housing Act. So if a seller takes an offer based on those criteria, instead of the objective facts of the offer itself, it could potentially expose them to a discrimination lawsuit. The state of Oregon has gone as far as trying to make "love letters" to woo sellers illegal — while that law is under review, expect the practice to come under increased scrutiny around the country. And many real estate agents across the country, following guidance from the National Association of Realtors, recommend against writing a letter to a home seller, and most of them won't — or at least shouldn't — help you craft one or present it to the seller. Even beyond the legal risks, there’s a chance a love letter could backfire — the seller might find it manipulative, an attempt to tug at the seller’s heartstrings to get an edge on the competition. Or you might have the best offer, but the plea you thought gave you an edge is in fact something the seller has a bias against. Just another reason not to risk it. What to Focus On Instead: The Power of the Cash Offer So if a love letter is off the table, what can you do to convince a seller to accept your offer — especially when you're competing with all-cash offers in a bidding war with other buyers? Rather than putting your time and energy into swaying a seller with your life's story, it's best to work with your agent on writing the best offer you possibly can. Keep in mind that when it comes to closing a deal, a seller isn't just looking for the highest bidder. A seller wants a deal that’s the most likely to close, and close as quickly as possible. This is one of the reasons why all-cash offers are so much more likely to succeed in a multi-bid situation — in fact, all-cash offers are four times more likely to be accepted. All-cash offers account for a full 36% of successful home sales. In an ocean full of competing fish, the all-cash offer is a killer whale. What makes all-cash offers so appealing? For one, showing "proof of funds" means the seller can be assured you don't still need to pass underwriting and secure the loan after the contract is accepted. A traditional mortgage application can still fall through even if a buyer has been pre-qualified. With a cash offer, that isn’t a risk. (Learn about other reasons sellers prefer cash buyers.) With Accept.inc as your alternative mortgage lender, you can secure the funds for an all-cash offer by getting Cash Approved™ up front. We'll provide you with the proof of funds you need to make offers with the power of cash, but allow you to pay off your home over time, just like a regular mortgage. That means you'll be able to compete against all-cash buyers or negotiate stronger terms against higher offers that have more contingencies attached. Get Cash Approved™ today and improve your chances of scoring your dream home by 4X.
Dan S | Apr 26, 2022
Homebuyer Resources
What to Expect from a Home Inspection
Buying a home can be overwhelming, especially if you’re doing it for the first time. Even after your offer is accepted (hooray!) you're dealing with paperwork, deadlines, negotiations, and a seemingly endless list of things that have to be done before the sale is actually finalized. You might be tempted to skip or shortchange parts of the process to get to closing faster (and we don’t blame you!), but there's one step every home buyer should take seriously: the home inspection. What Is an Inspection Contingency? If you’re in the middle of the homebuying process, you may have already heard of the inspection contingency (and if not, you will). But what is it, exactly? A real estate contingency is a clause in your home offer that lets you back out of the contract if something goes wrong or specific requirements aren't met (in other words, the sale is contingent on meeting the terms of the clause). More specifically, a home inspection contingency clause makes the sale dependent on the results of a home inspection. If the inspection reveals a problem with the home (such as plumbing, electrical, or structural problems), you can walk away from the contract, or try to negotiate repairs with the seller. A home inspection contingency is just one of several types of real estate contingencies that can be included in a home offer. The Inspection Process So how does the inspection process work? Don’t fret — we’ll walk you through it. After your house offer is accepted, you are responsible for hiring, booking, and paying for a home inspector to come to the home and look for defects. The timeframe for this inspection will be included in the purchase agreement — usually ten days after the offer is accepted. (If you don’t know where to look for a home inspector, the American Society of Home Inspectors is a great resource to get you started.) You’ll make an appointment with the inspector, with the understanding that the seller will have the house prepared and available for inspection. Now for the not-so-great news. A typical home inspection usually costs somewhere between $300 and $500, and as the buyer, you’ll probably be the one paying for it. There’s a chance the seller might offer a seller-paid home warranty as an extra incentive to buyers — some companies will give a discount on home warranties for sellers, and it can save them money on repairs if some are needed before a sale closes — but don't expect them to offer one. One estimate says only about 25% of existing homes sold last year in the U.S. had home warranties purchased by either the buyer or the seller. During the inspection, the inspector takes photos and makes notes, indicating any areas where repairs are needed (or have recently been made). The inspector will then provide you with a detailed summary of any issues they found. Some also include an estimated cost of any needed repairs — although these are not legally binding (inspectors are not contractors). It's common for inspectors to advise a buyer to consult other professionals, like electricians or plumbers, about specific problems they find. Once the inspector has presented their findings, you have a set number of days (probably laid out in the purchase agreement) to either move forward with the sale, ask the seller for repairs, or back out entirely. You can also ask for more time to further consult with professionals about the repairs, or ask the seller to lower the sale price based on the likely repair costs. This negotiation usually takes place between your agent and the listing agent, not you and the seller directly. The seller may ask for a copy of the inspection report in order to evaluate the time needed for any repairs. They might decide whether to perform the repairs or negotiate some more. If you’re not satisfied with the results of the inspection or the seller's response, you may choose to terminate the contract and receive your earnest money back, so long as the termination takes place within any deadline given in the sales agreement. What's Not Included in a Home Inspection When going through the home buying process, it's also important to know what a home inspection will not cover. A typical home inspection is a visual examination of the property, which means some things often don't get looked at or dealt with during an inspection. Things that generally aren’t included in a home inspection: Any areas that aren't readily accessible (for instance, blocked by snow or vegetation).Any areas that are dangerous to enter, such as areas with exposed wiring.Any systems (such as HVAC units) that aren't working and need to be taken apart to be inspected. Inspectors may also refrain from operating shut-off valves, taking off outlet covers to look at wiring, or doing anything else that might cause further damage. Common Problems Found During Inspections During a typical inspection, the home inspector will look at the following aspects of the home: Electrical, heating and cooling, mechanical, plumbing, roofing, structural, and ventilation problemsThe house's attic, interior, fireplaces, and outbuildingsLead based paints, pests, mold, radon, and proper permits While potential problems could arise in any of these areas, some of the most common problems found during a home inspection include: Faulty wiring, open junction boxes, or poor wiring jobsCracks or leaks in the foundationBent or clogged rain guttersMold, mildew, water stains, or other water damageRoof issues, such as broken flashings or curled shinglesFlaws in the foundation causing sloping floors or sticking doorsFaulty plumbing, such as problems with water pressure or slow drainsVentilation or heating problemsPoor upkeep (such as peeling paint, worn carpets, or minor structural damage). Can You Fail a Home Inspection? Technically speaking, you can't really fail a home inspection, because home inspectors don't deliver a "grade" on an inspection — they simply report on any problems they find. But it's certainly possible for a home inspection to reveal problems that you would consider to be deal breakers. Although most home inspections will reveal some issues (no house is perfect), it's fairly uncommon for an inspection to make a buyer walk away — only about 4% of home contracts fall through because of things like a bad inspection. Should You Waive the Inspection Contingency? So should you waive the home inspection contingency or not? Let’s face it: in a fiercely competitive home market, it can be hard enough to find your dream home, and even harder to win a bidding war. Many buyers are looking for any advantage they can get over other interested buyers. One way buyers can gain an edge is to waive contingencies in the sales agreement to make the entire process faster and less complicated for everyone — and that can potentially include waiving the home inspection contingency. But is it a good idea? The short answer is: almost never. Waiving a home inspection contingency can be very risky. Without a home inspection, serious problems might go undiscovered until after the sale is complete — a crack in the foundation, a deteriorating roof, or the dreaded mold problems. All that could lead to thousands of dollars in repair costs, which will be entirely the buyer's responsibility to bear. In other words, it’s a recipe for regret. Granted, waiving a home inspection contingency can greatly increase the appeal of an offer to the seller, since it reduces their risk and potentially saves them time and money negotiating and paying for repairs. But in turn, you'd be shouldering much more risk. If the buyer has the finances and means to accept that much risk, then waiving the home inspection contingency is certainly an option — but it's generally not recommended. Even if money is tight, you should especially avoid waiving the inspection contingency to save money on the inspection fee — the cost of an inspection is very small compared to the potential financial risk. Ask your real estate agent for their advice on waiving the inspection contingency, and they're likely to tell you the same thing. When to Walk Away Let’s imagine your home inspection has turned up some major problems. When should you walk away and get your deposit back? The short answer is, "it depends." Unfortunately, there's no hard and fast rule for when to make use of that home inspection contingency and back out of a contract. Here are the main factors to consider when deciding whether or not to walk: How badly do you want the home?Is the seller being reasonable about repair negotiations?Can you afford any repairs that you'll be responsible for? During the home-buying process, you should weigh these questions carefully, preferably working with an experienced real estate agent before deciding on the best move. Setting Yourself Up for Success Losing your dream home due to the results of a bad home inspection, or because the seller went with an offer with no such contingency, is not nearly as heartbreaking as learning your dream home is actually a nightmare of a money pit after already moving in. At the same time, you should have realistic expectations about what you can reasonably fix (and whether you can afford it). If you can’t, then be prepared to walk away. And while we don't recommend waiving the inspection contingency, we do recommend writing the most compelling bid possible by making an all-cash offer that does not include a financing or appraisal contingency. Want to learn how a cash offer, with no financing contingencies and no additional costs, can increase your likelihood of making a winning offer by 4X? Apply to get Cash Approved™ today!
Dan S | Apr 22, 2022
Homebuyer Resources
What is an iLender?
Technology has revolutionized our world — making our lives easier and, dare we say, more fun. Modern technology has shaped the way we interact, do business and navigate life, including how we approach the buying and selling process in real estate. And now there’s a new player in town that’s making waves in the mortgage lending space – the iLender. What is an iLender? An iLender is a technology-enabled lender that empowers buyers who qualify for a mortgage to submit all-cash offers on a home. The business category of iLender — the "i" stands for "instant" — was originally established in 2016 by Accept.inc and iLending is now a quickly growing category in real estate financing. The term “Power Buyers” has also been used in conjunction with “iLender” to describe this new segment of real estate technology companies. The rapid rise of Power Buyers can be attributed to the low supply and high demand for housing – creating the need for products and services that’ll help potential home buyers stand out from the crowd. How does the iLender process work? iLenders like Accept.inc perform the underwriting process upfront, fully approving potential buyers for a loan before they ever submit an offer. This stands in contrast to the traditional mortgage offer, where the buyer isn’t fully underwritten until after a home is under contract. After undergoing an iLender underwriting process, buyers can shop the housing market with confidence, speed and the power of cash in their back pocket. Once they’ve found that perfect home, the buyer’s agent will submit an all-cash offer with proof of funds. The iLender then purchases the home in cash on behalf of the buyer. Once Accept.inc acquires the home, we immediately sell the property back to the buyer at the same exact price under a mortgage, allowing the buyer to pay back the money over time just as they would with a traditional mortgage. Note that unlike Accept.inc, some iLenders charge for their cash offer service in the form of a flat rate or percentage of the home purchase. In the iLender model, the buyer purchases the home and secures the loan through an iLender, but the buyer remains in full control over the offer to the seller. This provides potential buyers with the advantage of making an all-cash offer, while still receiving a traditional mortgage at the end of the process. iLenders make offers on homes more competitive, particularly in multi-offer situations, by providing buyers and their agents with more negotiation power. In both buyer's and seller's markets, the power of a cash offer isn't just about winning a bidding war — cash buyers can negotiate cash savings! How does paying 12% less sound? That's the hidden discount of an all-cash offer compared to bids relying on traditional mortgage financing. From a seller’s perspective, cash offers backed by an iLender are highly attractive because they remove pesky financing and appraisal contingencies and offer a speedier close. Instead of the average 47 days to close through a traditional mortgage lender, Accept.inc offers typically close within 14 days. iLender vs iBuyer: what’s the difference? If you've been following the real estate market for the past few years, you may have heard the term "iBuyer" and read how iBuyers are driving up housing costs. So, what's the difference between iBuyers and iLenders? iBuyers are akin to institutional house flippers. They use a system of algorithms to determine a home’s value and use cash to purchase the house directly from the owner. According to The New York Times, “On average, iBuyers offer 0.22 percent less than fair-market value for a home and charge the seller slightly higher fees, about 1.3 percent more than a conventional listing agent would. The trade-off is a faster transaction — the process takes days rather than weeks, as there are no extended escrow periods — and fewer of the hurdles that give sellers headaches, like open houses and multiple showings with strangers.” Once a piece of property is purchased by an iBuyer, it’s turned around and listed for sale for immediate profit (in theory). The challenge for home buyers is that they have to compete with these institutional investors when they are making offers in an already tight market. In contrast, iLenders give buyers the opportunity to make all-cash offers — but with the flexibility of a mortgage. In other words, buyers can now compete on a more level playing field with other cash buyers — and also reap the benefits of speed, certainty, and convenience of an all-cash offer — while still having the ability to spread the cost of the home into affordable monthly payments over a 15 or 30-year term. iLenders level the playing field Let’s be realistic, the average homebuyer doesn’t have the liquidity to simply pay outright for a home using cash. And, even if you do have that type of cash on hand, obtaining financing is still the more strategic option when interest rates are favorable. From building home equity and the tax-related benefits of a mortgage to freeing up dollars to invest in other areas, partnering with an iLender lets you enjoy the benefits of a cash offer and the advantages of having a mortgage (otherwise known as having your cake and eating it too). That’s why we created Accept.inc: to level the playing field. We believe anyone who qualifies for a mortgage deserves the speed and competitive advantage that cash buyers are enjoying. Sarah Frohnapfel, a Denver real estate broker on the Abell to Sell team at Compass Real Estate, has this to say about using Accept.inc instead of a traditional lender: "It's our obligation as real estate professionals to provide all of the resources and options that are available to our clients. Being able to make a cash offer in this market will likely set your offer apart from others. Sellers in some areas of Denver Metro are receiving more than 10 qualified offers, and submitting a cash offer is a major advantage during a competitive buying process. Having closed over a dozen deals with Accept, I know what to expect and can honestly say to my clients that we will find their home faster in this market by using their services. Former clients have also found the ability to close much sooner a true benefit of using Accept. It's fast and furious but with the right team in place the buying process can move very smoothly and much more quickly. “Not only are cash offers through iLenders 4X more likely to win over traditional mortgages, and to do so at a lower offer price, but Accept.inc provides homebuyers with competitive rates with no additional costs or hidden fees. That sounds like a win-win to us. Ready to take the next step in your home buying journey? Learn more about all the advantages of buying a house with cash. And once you’re ready to begin shopping the market with the power of cash, apply to become Cash Approved™ today!
Kelly K. | Apr 6, 2022
Homebuyer Resources
7 Types of Real Estate Contingencies and When to Waive Them
When you finally have your dream home in your sights and you (finally!) made the winning offer, the last thing you want is for the deal to fall through. But at the same time, you want to be able to walk away if a huge deal breaker is revealed in the time between your offer being accepted and closing. If the home inspection reveals the house is actually a money pit or the property title is in dispute, for example, of course you want to be able to get out of the contract. This is where contract contingencies come in. What is a contingency clause, why is it important, and when should you think about waiving contingencies when buying a home? Read on to find out about 7 types of real estate contingencies – from common to obscure. What Is a Contingency in Real Estate? A contingency is a condition that must be met before a deal is finalized. In a real estate transaction, contingencies are usually designed to protect the buyer by letting them walk away from the sale if specific conditions are not met. Contingencies can also slow down and complicate the home-buying process. Or terminate the deal entirely. And who wants that? In a sellers' market, anything that slows down the process puts buyers at a disadvantage, especially if they're trying to win a bidding war against other interested buyers who have fewer strings on their offers. That doesn't mean you can or should remove every contingency in your offer. Here are explanations of different types of real estate contingencies and when they are useful (and when you should consider waiving them). 7 Types of Real Estate Contingencies1. Appraisal Contingency What to know: Typically, a mortgage lender will not approve a loan where the loan amount is out of line with the appraised house value.That's because a low appraisal means the property may not provide enough collateral to support the amount of the loan. An appraisal contingency allows the buyer to back out of the contract with no consequences when a home appraisal reveals the value of the home is lower than the offer price. For a seller, a low appraisal coupled with an appraisal contingency means they'll either be forced to renegotiate the sales price or find another buyer who will meet the sale price despite the appraisal value. When to waive: Waiving an appraisal contingency can be the difference between winning and losing in a multi-offer situation. According to the January 2022 RealtorsⓇ Confidence Index Survey, 22% of buyers in the previous three months waived an appraisal contingency. If the buyer has the means to make a cash offer — or can cover the appraisal gap out of pocket — this tells the seller that the buyer can pay the price they bid even if the appraisal comes in lower. Buyers using traditional financing will be limited in their ability to waive this contingency by their lender's rules if they don't have enough additional cash to cover the deficit. Waiving the appraisal contingency can be risky because the gap may be much higher than you expect or are able to budget for. If you make an aggressive bid in order to win, and you waive the appraisal contingency, you may find yourself needing to come up with many tens of thousands of dollars out of pocket – or find yourself in breach of contract. If you make an offer backed by Accept.inc, on the other hand, you buy with the power of cash and waive your appraisal contingency entirely. That's because Accept.inc provides a Value Check on the home before you make your bid. Our process guarantees that you'll know the maximum appraisal gap you might need to cover; your gap will not be more than the difference between your bid amount and the Value Check (assuming your offer is higher than the value check). Why does this matter? It means no surprises. With traditional financing, you won't know until well into the process how much extra cash you need to have lying around to make up the difference between your offer and the appraised value (or your loan amount). With a Value Check in hand, on the other hand, you'll have the confidence to make an offer knowing your maximum appraisal gap amount and how much you can bid. It protects you — and the seller — from appraisal gap uncertainties. 2. Financing Contingency What to know: A financing contingency, sometimes called a mortgage contingency, allows a buyer to pull out of the contract with limited consequences if they're not able to secure the needed mortgage.The simple pre-approval that a typical lender does when you're shopping rates doesn't guarantee that your financing will come through during the final underwriting process. If a buyer chooses to omit the financing clause in their offer but cannot get the funds in time for the closing date, they likely have to forfeit their earnest money deposit. The seller would have to choose between delaying settlement in hopes that giving the buyer additional time will allow them to secure a loan or putting the home back on the market. In Q4 of 2021, nearly 30% of home contracts were delayed or terminated and more than 20% of those delays and terminations were due to financing issues. (Source: January 2022 RealtorsⓇ Confidence Index Survey) When to waive: If you're making an offer that depends on a traditional mortgage, there is a risk that financing will fall through. And you don't want to be on the hook if you waived this contingency. Cash buyers, on the other hand, make offers without a financing contingency; they can show proof they have the liquidity to pay the full offer price with cash in the bank – no strings attached. How do you compete with a cash buyer that's flashing a metaphorical trunk full of cash? By making a good-as-cash offer yourself! When you're Cash Approved by Accept.inc, you get all the benefits of paying a mortgage over time, but you are able to make a full cash offer using Accept.inc's proof of funds. Learn more about the difference between a mere pre-approval and an Accept.inc Cash Approval. 3. Home Inspection Contingency What to know: A home inspection contingency, also known as an inspection rider, allows the buyer a chance to back out of the sale if the home inspection reveals significant problems or issues with the property.This contingency can also allow for negotiating repairs and the associated costs with the seller.It is the buyer's responsibility to arrange for the home inspection within a week or two of the contract being signed. When to waive: In a highly competitive market, a lot of buyers find themselves under pressure to waive the inspection contingency because they know a seller will prefer offers that don't include one. But if you've seen the Tom Hanks and Shelley Long classic "The Money Pit," you might be leery of buying a house without knowing what's wrong with it and how much it would cost to fix. And rightly so! That's why some serious buyers ask for what's called a pre-offer inspection. If they find issues with the home, they would simply choose not to put an offer in. This makes the inspection contingency a moot point. Unfortunately for buyers, a pre-offer inspection is nearly impossible to do in highly competitive seller's markets because it requires the owner to agree to let an inspector into the home prior to going under contract. As you've undoubtedly seen in the frenzy of the market in the last few years, many homes are pending sale mere days after the listing goes live (which often means offers were submitted after the first open house, if not before). Allowing for a full pre-sale inspection isn't attractive to sellers, especially if you consider that they would be required to disclose any major issues that come up in an inspection once they are made aware of it. Doing a pre-sale inspection can be a great strategy for avoiding the inspection contingency, but it is often not a viable option in a seller's market like we are seeing in many metro areas these days. That said, skipping the home inspection entirely, even if you're worried it might be the only way to win your offer, is an exceptionally risky move. 4. Home Sale Contingency What to know: Sometimes a buyer needs to sell their current home before they are able to afford a new home. A "home sale contingency," therefore, stipulates the buyer's current home must be sold before the new sale can proceed.This contingency usually comes with a deadline. If the house is not sold by the end of the contingency period, the contract can be extended, or the seller can back out of the deal.There are two types of home sale contingencies: a sale and settlement contingency, and a settlement contingency.A sale and settlement contingency is used when the buyer is selling their existing home but hasn't yet received an offer or signed a contract. Under this contingency, the seller may use the "kick-out clause." A kick-out clause means the seller may continue to list the home and entertain other offers, potentially "kicking out" the current buyer in favor of another offer.Under a settlement contingency, the buyer's home is already under contract, but they just need to complete closing on their old property. In this case, the "kick-out clause" is not applicable, and the seller cannot continue to market the property as for sale. When to waive: While being able to sell a home before starting payments on a new one is obviously ideal for the buyer, be warned that including a home sale contingency in your offer (also known as making a "contingent offer") is highly unattractive to sellers. If you have no choice but to submit an offer with a home sale contingency, do everything you can to make it significantly more competitive. That may mean offering a higher price or making a cash offer (which eliminates financing and appraisal contingencies), or possibly both. Strategize with your real estate agent about what it will take to be competitive if there's no way around this requirement. The good news: If you're a first-time home buyer, then this contingency isn't relevant. 5. Title Contingency What to know: In real estate, the "title" is the legal right to ownership of the property. The title changes hands every time a property is bought and sold. During the closing process, a title company conducts a title search of public records to ensure that the seller has the rights to sell the property and that there are no other claims to it. In short, the title search makes sure the seller is legally able to sell the property and that no one else can claim it after the sale.A title contingency, therefore, is a clause in the contract that ensures the buyer can back out of the contract if the title search throws ownership of the property into question. When to waive: Lenders will not close a loan if the ownership of the title is in question, so it won't be possible to waive this contingency with traditional financing. Even with a cash offer, it is not advisable to skip the title contingency since no buyer should be willing to purchase a home without a clear title. Note that a title contingency is not the same thing as title insurance (which provides remedies if the initial title search missed something and another party lays claim to the property later down the line). 6. Home Insurance Contingency What to know: A home insurance contingency requires the home buyer to apply for and secure homeowner's insurance before the sale can complete.This contingency may be added by the mortgage lender as one of the terms of the loan -- in other words, they will not issue a mortgage loan until the buyer has homeowner's insurance.A home insurance contingency can also be requested by home buyers. If the home happens to be in a state at high risk for certain hazardous conditions (like hurricanes, fires, earthquakes, etc.) some insurance carriers may flatly refuse to issue homeowner's insurance. This contingency allows the buyer to walk away from the deal and keep their deposit if they're unable to secure an insurance policy. When to waive: Even if you've been doing a ton of research on home buying and real estate contingencies, you may not have heard of this one. This is a pretty typical requirement for home buyers and not something that would be considered a stumbling block. Most mortgage lenders will not issue you a loan in the first place if you don't have homeowner's insurance to protect your investment (and their collateral) and there's no reason to waive this contingency. 7. "Right to Assign" Contingency What to know: This contingency is generally only used by real estate wholesalers and investors. Investors agree to purchase a property, then sell them to another investor at a wholesale price.The "right to assign" contingency allows the investor to back out if they can't find another buyer for the property, for whatever reason. When to waive: As an everyday home buyer this contingency isn't something that would come up in your home-buying journey, even if you're buying another residential property to rent out for income purposes.Key Take-Aways About Real Estate Contingencies As you can see, there are common contingencies you can waive if you're making a cash offer, common contingencies that you may choose to keep to protect yourself, and any number of obscure contingencies you might write into an offer for very specific and niche needs. But the more contingencies an offer carries, the less attractive it is to a seller because these contract riders can slow down and even completely derail the home purchase. That's why removing the financing and appraisal contingencies with an all-cash offer is one home-buying strategy that is sure to give you a competitive edge over other buyers. Learn how getting Cash Approved brings you one step closer to moving into the home of your dreams!
Dan S | Apr 4, 2022