WHEN you sell your house where the money comes from on completion day is irrelevant to the seller or is it?

Should you accept a lower offer from a cash buyer?

Why are cash buyers seen as being stronger buyers?

These are very important questions if you are on the market or thinking of agreeing a sale.

So here is the scenario: you have two offers one from first time buyers for the asking price, the other £3,000 less from a cash investment buyer, why would you not go for more money after all £3,000 is a large sum of money isn’t it?

There can be so much to consider and it could depend on your circumstances.

You may be in a situation where you need to move quickly and cash purchases are often quicker and smoother transactions.

The greatest risk with a mortgage can be whether it be finally approved.

All estate agents should be financially verifying all buyers in any case.

At Besley Hill Town & Country Homes the source of cash buyers funds are fully checked as we need to check whether the cash available immediately from a savings account or whether the funds will be coming from the proceeds of a house sale.

Likewise funds may be expected from inheritance which have not yet been received at the point of sale and we of course have a duty of care to our vendors to ensure they are aware of any potential delays.

For instance with probate being granted to allow release of inheritance monies.

In the case of a mortgage being obtained, the agent needs to ensure they check both the source of the deposit money and ensure a mortgage Agreement In Principle (AIP) is in place from a lender.

Unfortunately the AIP is no guarantee that a mortgage will be approved but it is a good indication.

It is nearly two years since the new rules were applied by The Financial Conduct Authority where by lenders must ensure that borrowers only obtain a mortgage they can afford.

These new affordability checks include stress testing were there to be a rise in interest rates.

Key factors will also include children and potential maintenance payments, childcare costs, any debt repayments as well as all other outgoings.

Income multiples no longer apply.

Once the mortgage has been approved by the lender for affordability, the next stage is the property valuation and survey.

If you obtained a very good price for your property there is a risk that it may not be valued at the full sale price by the surveyor and then the full amount requested not being lent.

The other risk is if the property requires major work the lender may place what is known as a retention on the property.

This can mean not lending the full amount requested unless the work deemed necessary is carried out first.

These risk factors are reduced with cash buyers, of course a survey could still flag up essential work and re-negotiation or a buyer withdrawing can happen what ever the source of funds.

Every sale must be assessed individually and ultimately you as the seller has to decide what is best for you.