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FAQ: When Is A Cash Buyer Also Considered His Own Lender?

When Is A Cash Buyer Also Considered His Own Lender?

If you listen to a certain Area Regional Manager for Century 21 or Capital Title, by paying cash, the buyer also becomes his own lender and is entitled to "lender approved" closing costs.

Now if you listen to the attorneys at the Texas Association of Realtors (TAR), those are the people that actually write the contracts, the answer is a resounding NEVER. One attorney (I consulted two) at TAR told me that this logic makes absolutely no sense. That's their way of saying B.S. I also consulted a number of Title Companies and Mortgage Brokers who said the same thing in not so nice terms. In addition, I ran this by 2 other real estate attorneys and they were in full agreement that this was a scam. How can the whole world understand and agree that a cash buyer is never a lender and the people mentioned above feel differently? In fact the residential buyer's contract now automatically puts a  zero in the lender closing costs paragraph when the box is checked as a cash purchase. The answer is simple: There are a number of realtors who either don't know what they are doing or are trying to change the rules just before they close to get a last minute discount knowing that the seller is ready to close. My only suggestion is Beware and if there is any question, the lawyers at TAR are willing to help.

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