Planning to buy a home and not sure whether to finance or pay cash? Both options have pros and cons. 

If financing is needed, get pre-approved first, then choose a realtor® and begin your search. There’s nothing worse than falling in love with a home then losing out to a cash buyer while waiting for approval. 

For those who don’t have a go-to lender on speed dial, Forbes is partnered with Bankrate and lists the best companies and rates available online monthly. Answer the questions listed regarding price range, type of mortgage desired, cash down, credit score, etc., to be matched with the right company. 

If you have cash burning a hole in your pocket or are considering cashing in stock to pay for a home, there are some things to consider. 

You can pay cash to buy a home in order to save money up front, and then opt for delayed financing after the purchase is made to build your savings and have money for renovations. Your home is a liquid asset. If you take every penny from savings, sink it into a home, then financial hardship sets in, you will likely regret not financing. 

A mortgage can also offer tax breaks. Paying cash to avoid having a mortgage may offer peace of mind yet not be the best financial decision. Putting money down and then financing at a time when home prices are rising can leverage gains when the home appreciates. 

First time homebuyers can withdrawal up to $10,000 penalty-free from their IRA. Yet withdrawing a large amount from a retirement account and neglecting to pay back the money in the time limit specified, will result in large penalties and interest. A homebuyer in Florida withdrew the entire cost of a new home from a retirement accounting thinking that he would pay back the amount in full once his other home sold. The house didn’t sell on time which meant he was late paying back the borrowed amount which resulted in $70,000 of penalties and interest. The IRS has distribution information on their website. 

And when cashing in stock, be sure to choose carefully. Cashing in stock that continues to rise can mean a huge financial loss when all is said and done. 

Our Alloy Investment Management team can help take the guesswork out of investing. Call 800-689-3935 to speak with one of our experts.