Why do auto dealerships balk at cash transactions, but real estate companies prefer them?
In: Economics
Car dealerships get commissions for referring loans to banks, so they prefer a buyer who will take a loan and earn them a commission.
A real estate seller is a home owner, not a company, and the seller doesn’t get anything from the buyer’s lender if the buyer takes out a mortgage. They prefer the quicker closing time frame and lack of potential that inability to get approved for a loan or a low appraisal could derail a purchase requiring a mortgage.
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