With recent lending changes, clients can refinance sooner rather than later after an all-cash offer!

We all know that in a tight inventory market, the all-cash offer gained a lot of traction – giving the seller one less thing to worry about derailing the closing. We saw this trend fade in 2022, but have seen a rise again in 2023. This would be a great time to explain what delayed financing is and why now, more than ever, you and your clients need to know about this option.

Delayed financing is the term used when a buyer pays all cash for a property and then takes out a mortgage within six months of the sale to pull out some of that money that was used to purchase the property. Here are a few things to know:

• The source of cash to purchase has to be the borrower’s own funds – like an equity loan on a current property, savings, investments or 401(k) loan. It cannot be gifted funds from another entity

• Can be any property type and any occupancy – primary, investor or second home — the amount available are subject to those parameters

• Can have no other liens used to acquire or are currently on the property

So why is this so important now? Because as of February of 2023, requirements are that you have to have ownership of a property for 12 months before you can take cash out. Using delayed financing gets you access to the equity six months sooner!

Not sure if delayed financing is the best option for your client? Reach out to a Key Mortgage loan officer today!