Have we accepted the right offer?

lookstraightahead

I think you are being quite logical in your thinking, getting a good figure but with someone who can potentially take the hit if the house is down valued.

steve866

I would have done the same thing. A chain free cash buyer living with relatives ready to move is different to an ‘investor’ cash buyer who might try and renegotiate. Either way I’d always go for a cash buyer over a first time buyer requiring a mortgage. 

Flugelhorn

you don't need to worry about the bank /mortgage company  downvaluing if there is a cash buyer as the bank won't be involved 

Help1234

Hello - update if anyone can help me - the original first-time buyer is keen for us to consider their offer of £220,000. They are first-time buyers and have proof of funds for the deposit which is apparently 10% plus they have another £20,000 for if the property is down valued. The estate agent spoke to them about this and why we had gone with the cash buyer before but they said they don’t care if the property is down valued as they have the funds to make up to their agreed price.

Please advise what do I do? Obviously we want the best price we can get as the house prices we are looking at for next time (initially moving into rental) are in excess of £400,000. However we need to move asap and don’t want any issues. From an emotional point of view, it would be nice to sell to first-time young buyers as that’s what we were and that’s what this house was for us. I just feel lost now. The first-time buyer has convinced our estate agent available today that she is just as good an option as the cash buyer. The other person at the estate agents we spoke to yesterday advised us to go with the cash buyer.

leonj

Help1234 said:

Hello - update if anyone can help me - the original first-time buyer is keen for us to consider their offer of £220,000. They are first-time buyers and have proof of funds for the deposit which is apparently 10% plus they have another £20,000 for if the property is down valued. The estate agent spoke to them about this and why we had gone with the cash buyer before but they said they don’t care if the property is down valued as they have the funds to make up to their agreed price.

Please advise what do I do? Obviously we want the best price we can get as the house prices we are looking at for next time (initially moving into rental) are in excess of £400,000. However we need to move asap and don’t want any issues. From an emotional point of view, it would be nice to sell to first-time young buyers as that’s what we were and that’s what this house was for us. I just feel lost now. The first-time buyer has convinced our estate agent available today that she is just as good an option as the cash buyer. The other person at the estate agents we spoke to yesterday advised us to go with the cash buyer.

I would give them a shot!

AdrianC

Help1234 said:

Hello - update if anyone can help me - the original first-time buyer is keen for us to consider their offer of £220,000. They are first-time buyers and have proof of funds for the deposit which is apparently 10% plus they have another £20,000 for if the property is down valued.

So they've got £40k equity, and need a £180k mortgage.

If the valuation comes back at £200k, that's 90% LtV. Probably doable.
If the valuation comes back at £190k, that's 95% LtV. Borderline.
If the valuation comes back at £180k, that's 100% LtV... Definitely not happening.

Or have they forgotten about the fees etc they also need to pay for?
What if the survey comes back with all the usual caveats and potentials, and they get wobbly?

ele_91

I’m wary of cash buyers as they are flaky and IME have funds tied up in all sorts of inaccessible places and require a mortgage anyway. Has the EA got a solid proof of funds from the cash buyer? Do you know what the FTBs do for a living? Two FTB tried to buy my house and couldn’t get a mortgage due to being self employed or history of furlough. 

I would give them a shot they sound like they really want the house and it’s so tough for people to get a foot on the ladder.

kungfu_navs

Looks like the FTB have some serious FOMO going on, will they be this emotional when the survey comes back and want to reduce the offer? this would be my main concern after the devaluation. 

If it was me I would stick with the cash buyer, they sound like they are planning to live in the property and not as an investment and as a previous property owner "should" have a better understanding of surveys. 

Flugelhorn

I would stick with the cash buyer, they might be like me and have the money waiting in an easy access savings account

Waunakee

Don’t allow your heart rule your head as it’s first and foremost a business transaction!

Assuming your EA has verified the status of the cash buyer and they do indeed have monies readily available I would stick with this buyer.You have after all already accepted their very good offer.

By all means give the FTB a shot but consider what may happen in various scenarios - the property is downvalued,they fail to secure the level of mortgage required,they fly into a blind panic upon reading the survey results and worst of all they get parents involved.