Wednesday, July 22, 2015

What A 'Cash' Real Estate Deal Really Is (...and isn't)

Let me begin by saying what a 'cash' real estate deal is not. With rare exception, it is not a shopping bag stuffed with twenties and C-notes plopped down in the middle of a title company closing table next to the HUD statements, complimentary pens, and customary jar of breath mints (although I did once find myself staring, in awe, at a gym bag full of stacked and banded currency in the lap of a potential foreclosure buyer--but I'll save that for another post on another day). 

Also, a 'cash' deal is not always a wired money transfer to the title company on closing day, nor is it necessarily a certified bank check brought by the purchaser for the full purchase amount. Of course, both of these examples are fairly common occurrences when the buyer has already sold and closed on a previous property; or, a corporate relocation company is involved in the deal via an agreed buy-out scenario; or, the purchaser is just plain rich.

The type of 'cash' deal I'm referring to is something more commonly used as a Real Estate 101 negotiation tactic, particularly in a multiple offer situation. Simply put, it is a waiver (and absence) of any 'mortgage contingency' attached to the initial contract. Such a waiver usually does not prohibit a buyer from getting some form of financing--the deal just can't be dependent on it. In other words, the buyer is declaring his/her liquidity for the offered amount, or is absolutely certain in their ability to obtain a real estate loan outside the legal wording of the deal (usually backed by a large bank account, portfolio of paid-off properties, etc). A verified Proof of Funds letter should be required in any case.

And while such 'cash' deal offers (mortgage contingencies waived) may appear to be stronger than offers merely accompanied by a glowing 'pre-approval’  letter on watermarked stationery, the seller should not be too quick to jump. I've found, over the years, that most offers with a 30% - 50% down payment (and the balance financed) close escrow with equal or better success than any of the scenarios mentioned above. Deals that begin as 'cash' sometimes morph into 'financed' after initial acceptance, depending on the savvy of the real estate attorneys involved--and usually after the property has already been flagged as 'Pending' in the MLS and tied-up in Attorney/Inspection Review for a week, or two, or three, or.... At this point, many sellers just decide to move forward and work with the deal they already have in hand rather than killing it (not as easy as it sounds), and re-listing.
Bottom line: at the very the end of the real estate day--if the deal successfully closes escrow, the seller walks with 'cash' anyway; be it from a closed loan, certified bank check, money wired from standing assets, a shopping bag of bundled swag, or otherwise. And that, dear readers, you can take to the bank.



Tuesday, July 21, 2015

Chicago Side Streets

Albany Park, Chicago

Edgewater Beach, Chicago

Buena Park, Chicago

Took a spin through a couple Chicago Neighborhoods over the weekend and came across all kinds of  ways to relax  and enjoy the nice weather. (+ Free Chicago MLS Search Engine)



Monday, July 13, 2015

Smoking vs Buying a Chicago Condo

Uptown Chicago cig sign
cig sign @Lawrence & Marine, Chicago

Okay, I'm not a tobacco user so I have no dog in that fight (see above pix). To each his/her own, etc. However, simple math reveals that the money spent on a two pack a day habit ($11.80 per pack + tax in the city...geez) would easily cover the principle, interest & PMI payment on most two bed/one bath condos currently for sale in the Uptown neighborhood of Chicago. And...quitting for 18 months would cover most of the necessary 10% down payment. Simply put, quit smoking and buy some property, fellow hipsters. Even in the worst real estate market, it won't kill you.

Condo Sale Price      = $150,000

10% Down Payment  = $  15,000

Monthly P&I @4%     = $       665

Monthly PMI            = $         56

ps...quit drinking, too...and you can probably buy a Lexus.



Saturday, July 11, 2015

Uptown Chicago Coffee Spot

Heritage Uptown Coffee
Heritage Outpost @1325 W Wilson Avenue, Chicago

My latest favorite java spot is Heritage Outpost in the Uptown neighborhood of Chicago. Located in the lobby of a circa 1920s elevator apartment building, Heritage is the coolest new spot in the 'hood. The 1300 block of W Wilson has a very old world European vibe and this micro coffee house (fashioned with a 'walk-up' sidewalk window) fits right in. Great coffee and great people watching. Feels like the Left Bank of Paris in 1945 -- or so I imagine.



Tuesday, July 07, 2015

My Top 10 Chicago Real Estate Deals - July 2015

Click Here to view my Top 10 Chicago real estate deals for July.  This month I'm focusing on Near North Side & Near West Side condos priced between $450,000 - $535,000. And if you're on Facebook, please drop by & 'Like' my Chicago Real Estate.House business page--that is of course, if you like it.



Monday, July 06, 2015

Thursday, July 02, 2015

Chicago Neighborhood Pix

Uptown Neighborhood woman walking down Sheridan Road.

Logan Square Neighborhood Sticker Jeep
'Dykes on Bikes' on Halsted. Lakeview Neighborhood