Buying a House With Cash: What to Know Before Skipping the Mortgage

Thinking of buying a house with cash? Figure out the costs and benefits of paying cash vs. getting a mortgage.

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Updated · 4 min read
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Written by Holden Lewis
Senior Writer/Spokesperson
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Reviewed by Michelle Blackford
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Edited by Alice Holbrook
Assigning Editor

About a quarter of home buyers pay cash instead of getting mortgages these days. But is buying a house with cash the smart thing to do?

The answer depends on your goals. If you want to buy a house with cash to avoid paying mortgage interest, you should consider how much that money could grow if you invested it instead. If your goal is to beat other bidders for a home, buying with cash will attract the seller’s attention. You’ll still need to make a competitive offer, though.

Before you commit to buying a house with cash:

  • Identify what you hope to gain by making a cash purchase.

  • Don't assume that cash is better.

  • Consider how you might benefit by getting a mortgage instead.

  • Congratulate yourself for having a big bank balance!

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4.5

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3%

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New American Funding

4.5

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4.5

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500

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GO Mortgage - PURCHASE logo
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on GO Mortgage

GO Mortgage

4.0

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GO Mortgage - PURCHASE logo

4.0

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620

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3%

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Mortgage loans from our partners

NBKC - PURCHASE logo
Check Rate

on NBKC

NBKC

4.5

NerdWallet rating 
NBKC - PURCHASE logo

4.5

NerdWallet rating 
Min. credit score 
620

Min. down payment 
3%

Check Rate

on NBKC

New American Funding - PURCHASE logo
Check Rate

on New American Funding

New American Funding

4.5

NerdWallet rating 
New American Funding - PURCHASE logo

4.5

NerdWallet rating 
Min. credit score 
500

Min. down payment 
3.5%

Check Rate

on New American Funding

GO Mortgage - PURCHASE logo
Check Rate

on GO Mortgage

GO Mortgage

4.0

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GO Mortgage - PURCHASE logo

4.0

NerdWallet rating 
Min. credit score 
620

Min. down payment 
3%

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on GO Mortgage

Rocket Mortgage - PURCHASE logo
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on Rocket Mortgage

Rocket Mortgage

4.5

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Rocket Mortgage - PURCHASE logo

4.5

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580

Min. down payment 
3.5%

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Veterans United