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Pros and Cons of Paying All Cash or Financing a Home

By Mike in Mortgages with 0 Comments

If you’re looking at real estate for sale in Core San Diego and thinking about buying, there are two main financial paths you can take to purchase a home. Paying with all cash and financing through a mortgage both have their advantages and disadvantages, and the downtown San Diego real estate experts at 92101 Urban Living discuss a few of those differences.

Cash Payment


Cash gives buyers negotiation power. They can purchase practically any home they desire with no mortgage fees, lender qualifications, and interest fees getting in their way. This speeds up the purchasing process because appraisals and mortgages aren’t necessary, and it also ensures ownership with the deed and title to prove it. If equity is desired, it’s available when a homeowner needs it, and reselling to the next owner is a less stressful process.


A cash payment is for dedicated buyers who save sufficient finances specifically for real estate. After all, cash depletes their bank accounts. In addition, most buyers don’t have the resources to pay for a property upfront. However, owners risk losing value and a return on investment because of the cash payment. In cases of major storms or theft, a property purchased with cash can become a waste.

Mortgage Payment


A mortgage provides financial leverage for buyers. Real estate favors mortgages due to liquidity, which represents how fast buyers can leave an investment. Cash doesn’t provide that flexibility. Additional advantages may include credit score improvement and preserved savings. Simply fill out a mortgage application and provide the minimum requirements such as a down payment.


It’s misleading when mortgage holders believe they own their property. Technically, they don’t. The lender owns it throughout the duration of a mortgage, and the owner pays the lender. Expect to pay up to 30 years of payments before ownership, assuming you have an approval or pre-approval letter. Tough lender restrictions are often responsible for prolonging the process of purchasing a property. Banks can also seize the home if buyers don’t keep up with payments. With these disadvantages, don’t expect to resell a bank-owned home yourself without hitting a few roadblocks.

Whether you’re looking to buy a home with cash or finance a mortgage, there are plenty of Core San Diego lofts, condos, and penthouses to choose from. Get in touch with 92101 Urban Living today at 619-649-0368 and find out how we can help you purchase your ultimate downtown dream home. ')}