Cash is always a great form of payment. It is a concrete and definite fund you can put in your pocket. It doesn’t carry the same risks you would get when you sell a home using alternative financing methods like loans.
There are many reasons someone would want to pay cash for land. For example, they are able to maintain liquidity on the land. You are in a higher position of power when you sell land.
However, when you want to accept a cash offer for land you own, you need to be sure the owner is serious, so you’re not wasting their time and yours. If you want to sell your land fast, check out these questions to ensure a more seamless process.
1. Do They Agree to the Purchase and Sale Agreement?
When you are selling anything, you need to create a purchase and sale agreement for your buyer. In order to make a fair cash offer for the land, the buyer should agree and sign to the terms. Without a signature from them, you would only be going in circles.
There are many of these templates online you can create and edit to your liking. As a seller, you need to include a “no-frill” contract by listing legal terms that meet your standard.
You will want to include:
- The date of the contract agreement and date you expect the contract must close
- A legal description of the land being sold as-is
- The purchase price of the land and payment method you receive (cash)
- Any supporting details on who will pay for closing costs
- Full name and signature of the buyer (be sure to include a witness)
You should not be afraid or worried if a potential buyer wants to spend a bit of time to read the agreement in its entity. After all, it’s only right they should when they are paying for it.
So long as you are honest about what you want, expect, and will sell to the buyer, there should be no issues. Being transparent will often speed up the process more, which is what you want.
2. Do They Have the Deposit or Not?
When you are selling your land, you are going to meet several potential buyers. Most of these buyers will be nothing more than passersby. While they may have an initial interest in the property, they may not be serious in accepting the cash offer.
Some of these buyers may even attempt to negotiate you out of paying for the land with cash. You do not want to entertain these buyers who don’t appear serious.
If you want to sell land right away, you want to look for buyers that show they mean it with action. The best way to determine if a buyer is serious is to see if they are ready and willing to make a deposit.
When a buyer is willing to do this, they are just as eager as you to complete the process as you are. This deposit, or earnest money, goes into an escrow account.
Never ask for a deposit to be paid out to you directly. This does not keep the buyer’s interest in mind or protect them because they may fear you will run away.
3. Do They Agree to All Aspects of the Deed?
The deed is also another important aspect of the selling process because it is the official document that transfers legal ownership from one person to another. This is what the buyer wants when everything is said and done.
There are five types of deeds you may offer your buyer. As a seller, you should learn to differentiate deeds as it might be a good selling point.
Quit Claim Deed
When you sell land with a Quit Claim Deed, you aren’t offering a warranty with respect to the title. You are telling the buyer they are buying the land as it is and they accept the terms.
This type of deed is something sellers often use when selling real estate property, but you can also use it when selling land. You are telling the buyer you guarantee something, and there are no issues with the land.
You are guaranteeing the whole history of the property with this. Since this type of deed offers the highest buyer protection, it’s the most attractive for them to accept.
Bargain and Sale Deed
A Grand Deed is something you only want to use in certain moments. It transfers right to the grantee should they want to sell property in the future. Buyers who want to keep the land may not like the idea.
When you’re serious about selling land quickly, it’s best never to use this.
Grants Deeds transfer land ownership in exchange for a predetermined price. It is the best type of deed to use when selling land to buyers because no one can buy out the land under them.
Special Warranty Deed
This is an alternative to the Quit Claim Deed. With this deed, you also guarantee there are no defects, but only during the time you owned the land.
While you aren’t guaranteeing a spotless record from the beginnings, this type of warranty is still attractive to buyers who want to buy land quickly. This builds trust that what you are giving them is worth the cost.
Be Inquisitive Before Accepting a Cash Offer for Land
Whether you are selling land or real estate, money is, without a doubt, the best and quickest way to make a sale. It is ideal for those who want to stay away from the time-consuming process of finalizing a loan. There are many buyers who prefer to take advantage of finance offers, but there are also buyers who think like you and want to buy land with cash.
Prior to accepting a cash offer for land, you still want to be cautious and screen potential buyers. You can do this by asking them questions that verify they are serious.