How to Write an Offer as ‘All Cash’ Using a Hard Money Loan

When it comes to buying real estate, most real estate investors have given up on submitting anything but “all cash” offers. Particularly on investment properties being marketed at discounted prices relative to fair market value. If there is any “meat on the bones,” as the old saying goes, one must work fast to get a property under contract before someone else does. In other words, if it’s a deal, it won’t last long.


And in real estate investing, making an offer on a property is both an art and a science. Although there exists a certain protocol with regard to submitting offers, every real estate investor has a slightly different approach. While some mistakes are obvious, others are less obvious.


But what if you don’t have ‘all cash’ on hand and so cannot in good faith make an ‘all cash’ offer on a property? Many real estate investors just like you do not have the cash on hand. How do they in good faith make an “all cash” offer without having the cash on hand? Some of these investors have a relationship with a private money, hard money lender. In some cases they have been preapproved for a line of credit with the lender using the property as collateral. A preapproved line of credit is essentially a loan that looks and smells a lot like cash.


But wait a minute. If someone has a preapproved line of credit from a private money lender, doesn’t that still mean there is a loan on the property? How can it be an “all cash” transaction if there’s a loan involved?


Yes a line of credit is technically considered a loan. Although it differs from a traditional home mortgage, it is still a loan. The difference is, a “line of credit” mimics cash or creates an illusion that the buyer has cash on hand.


Because it’s often a short closing timeframe that is important for a seller who prefers “all cash” offers, real estate investors must be able to close quickly. For this reason, many real estate investors only work with private money lenders to fund their real estate purchases. Hard money lenders are known to fund transactions in a timeframe as short as a few days. A traditional home mortgage can often take weeks to close and fund. Good deals just don’t wait for slow loans!


Yes it’s easy to get preapproved with a private money lender for a line of credit whereby one can submit offers on properties as all cash. If you’re an active real estate investor, contact us about getting preapproved for a line of credit.


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Corey Curwick Dutton, MBA Park City, Utah

About the author

Corey Curwick Dutton, MBA Park City, Utah - 2005 MBA Graduate with 10 years experience in Business Management including International Management. Corey is a Private Money Lender and Loan Officer. In her spare time Corey enjoys writing on topics in the private money lending industry. She also enjoys hobbies such as mountain biking and skiing in the great outdoors of Utah.