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How to Make a Cash Offer With a Mortgage

Cash-offer financing programs give buyers who need mortgages the ability to make cash offers on homes.

Barbara Marquand
Chris Jennings
Updated
Investors and well-heeled buyers used to be the only ones equipped to make cash offers on homes. But now some real estate companies and lenders are giving buyers who need mortgages a chance to compete as if they have cash.
Here's how cash-offer programs work and what to consider before signing up.

What is cash-offer financing?

Cash-offer financing programs debuted in the past several years as the housing market heated up and a growing portion of buyers made cash offers to win bidding wars. Sellers like cash because they don't have to worry about a buyer having financing troubles that could delay — or prevent — the sale.
Traditionally, a buyer gets preapproved for a mortgage and makes an offer on a home. The lender then orders an appraisal and title search and finishes underwriting the mortgage. If all goes as planned, the loan is finalized on the scheduled closing date, and the buyer gets the keys to the house.
Did you know...
In June 2026, 25% of buyers paid with cash, according to a survey of real estate agents by the National Association of Realtors. That’s down from 29% a year ago.
With cash-offer programs, you still finance the purchase with a regular mortgage. But the cash-offer company agrees to purchase the home on your behalf before your loan closes. You then buy the home back from the company once your mortgage is final.
Some programs will buy the home for you only if the loan isn't finalized by a certain date. Either way, the seller is guaranteed to get paid on time.

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How cash-offer programs work

While each program works a little differently, here are the steps typically involved:
  1. Apply. First, you’ll apply and get preapproved for a mortgage with a cash offer or cash-backed offer. Keep in mind that requirements will vary based on the type of loan you choose and the lender you work with. For example, you’ll usually need a credit score of at least 620 and a low debt-to-income ratio (DTI) for a conventional loan.
  2. Make the offer. Work with a real estate agent to shop for a home and make a cash or cash-backed offer on a property. If your offer is accepted, some companies will purchase the home on your behalf. They’ll then sell it to you once you've gone through the full underwriting process and your mortgage is finalized. Others will purchase the home on your behalf if your mortgage isn’t finalized by the contracted closing date.
  3. Close the sale and move in. After the sale closes, move into the home. If the company has purchased it on your behalf, you'll rent the home from the company until your mortgage comes through.
Generally, programs require buyers to pay earnest money. This is applied toward the down payment when the mortgage closes. If you change your mind after a company purchases a property for you, you'll forfeit the earnest money — like you typically would if you broke a contract with a seller. Terms and fees vary widely based on the program, so review the contract carefully before agreeing.

Waiving contingencies with a cash offer

Some companies say the programs can enable buyers to waive financing and appraisal contingencies when making offers. Those are walk-away clauses that let the buyer back out of the deal without losing earnest money if their financing falls through or the home appraisal comes in lower than the offer amount.
Waiving contingencies can make an offer more attractive to sellers, but make sure you understand the risks before doing so. A lender won't loan more money than a home is worth. If the appraised value comes in lower than the offer amount and the offer doesn't include an appraisal contingency, you have a couple of options:
  • Renegotiate a lower price with the seller
  • Cover the gap yourself out of pocket.
Work closely with your real estate agent to craft the offer.

Pros and cons of cash-offer programs

Pros

  • With a cash-backed offer, sellers may feel more confident that the sale will go through. This could give you an edge over other buyers.
  • Some programs can help with buying and selling a home at the same time. You can make a cash offer on a home while waiting for your current property to sell.
  • You may be able to get into the home more quickly compared to buying the traditional way.

Cons

  • You pay fees to use some programs. And because the programs have varying terms and conditions, it will take time to sort through the options — on top of comparison shopping mortgage rates. 
  • With some programs, you have to use their affiliated real estate agents or lenders. If you use your own agent or lender, you’ll pay higher fees.
  • A cash offer or cash-backed offer isn't a guarantee that you'll win a bidding war, especially now that cash offers are more common.

Ask these questions before choosing a cash-offer program

  • How much is the fee? Comparison shop mortgage rates and fees among cash-offer programs and traditional lender mortgage programs.
  • Which mortgages are eligible, and what are the down payment requirements?
  • Can you work with any lender and real estate agent? If so, is there a higher fee for doing so?
  • How much earnest money is required? This is money you'll pay upfront and will be credited toward your down payment when the mortgage closes.
  • In what situations would you forfeit the earnest money? Read the program's terms and conditions carefully to find out.

Companies that offer cash-offer financing

Flyhomes
Flyhomes offers Flyhomes Cash Offer and a buy-before-you-sell program.
Details: Flyhomes provides a short-term loan that pays cash to the seller in as few as 10 days. You then refinance that loan into a long-term mortgage. You must use Flyhomes Mortgage for the short-term loan. For the long-term mortgage, you can choose any lender — though you won’t have to get approved again if you use Flyhomes.
Fees: There are no servicing fees or additional costs to use the program, though you’ll pay closing costs on the short-term loan.
Where available: Major markets in California, Massachusetts, Texas and Washington.
Learn more: Flyhomes
Guild Mortgage
Guild Mortgage offers the BuyNow Advantage program for conventional mortgages.
Details: Guild or an affiliated company will pay cash for the home if your mortgage isn't finalized by the sale closing date.
Fees: You’ll pay a $1,350 participation fee in earnest money.
Where available: In all states where Guild is licensed to do business.
Learn more: Guild Mortgage
Homeward
Homeward, a real estate company affiliated with Homeward Mortgage, has cash-offer and buy-before-you-sell programs.
Details: After getting approved for a mortgage with Homeward, you use your own real estate agent to shop for a home. Your agent will then work with Homeward to write an offer with a cash guarantee. You can close on the home directly with a mortgage or let Homeward purchase the home on your behalf and sell it back to you when your mortgage is finalized.
Fees: If Homeward buys the home on your behalf, you’ll pay a fee equal to 1.9% of the purchase price. However, if you close the sale traditionally with a mortgage, Homeward does not charge a fee. Instead, it requires that you put down an earnest money deposit of 1%.
Where available: Arizona, Colorado, Florida, Georgia, Oregon, South Carolina, Tennessee, Texas and Washington.
Learn more: Homeward
New American Funding
New American Funding works with NAF Cash, an affiliated company, to offer the NAF Cash program.
Details: NAF Cash will buy your new home upfront with cash, then sell it back to you for the original price, plus a service fee. You move in and pay rent until your mortgage from New American Funding is finalized, and you’ll have up to 60 days to sell your existing home. You can work with your own real estate agent, but they must get certified with the NAF Cash program. Conventional and VA loans are eligible.
Fees: The fee starts at 1.5% of the cash used to purchase the house and varies by state.
Where available: Nationwide.
Learn more: New American Funding
NerdWallet writer Ashley Harrison contributed to this story.
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