The math is structurally different. A cash buyer must discount to recover the capital they're deploying. We take over your existing mortgage instead of writing a check, so the discount isn't required. Both numbers are real. Here is the side-by-side, with the honest cases where each one fits.
The table is what shows up on the closing statement on each path, not what shows up in the pitch.
| Cash buyer | As Iz Homes (Sub-To) | |
|---|---|---|
| Typical offer | 60–70% of fair market value | 100% of fair market value |
| What funds the deal | A cash check from the buyer | Existing mortgage stays in place; we take over payments |
| Time to close | 7–21 days | 6-day average across our closes |
| Closing costs to seller | Standard seller-side | $0 — we cover seller-side closing costs |
| Repairs before close | Often required | None |
| Showings | Sometimes one walkthrough | None |
| Financing contingency | No — discounted to compensate | No — the loan that funds the deal is already there |
| Seller protections | None | Third-party servicing + positive credit tradeline |
| Agent commission | Sometimes negotiated down | Full 3%, paid from our down payment at closing |
Cash buyers don't discount because they're greedy. They discount because the math doesn't work without it. Every cash buyer's offer has to cover, out of the spread between purchase price and resale price, five line items:
The cash to pay for the home — borrowed at hard-money or private-lender rates, with origination fees on top.
Mortgage interest, property taxes, insurance, utilities for as long as the property sits on their books.
Paint, flooring, kitchen, bath — whatever the resale market demands to move the property.
Agent commissions, transfer taxes, title work, marketing — paid on the back end out of the same spread.
Typically 10–20% of resale price, which is what compensates them for taking the risk.
Add those up against a typical resale price and you get a purchase price around 60–70% of fair market value. That's not a negotiation tactic. That's the floor below which the deal stops being a deal for the buyer.
When you read about iBuyers offering 90% of fair market value, that's a different surface presentation — they typically tack on a 5–10% service fee that brings the net to the seller back into the 60–70% range. The structural math is the same.
We take title and the existing mortgage stays in place — same lender, same rate, same balance the seller originally signed. From closing forward, we make every monthly payment, on time, through an independent third-party loan servicer that sends the seller written verification each month.
The capital deployment that forces the cash-buyer math doesn't apply. We're not paying cash for the loan portion of the home value; the existing mortgage is doing that work. What we put up at closing is a down payment that covers the seller's equity above the loan balance plus the agent's commission — not the full purchase price.
Because we don't deploy capital on the loan portion, we don't need a 60–70% haircut to recover it. We typically pay full market value because the structure makes that workable.
We won't pretend Sub-To beats cash every time. Three cases where a cash offer genuinely fits better:
If the rate on the loan we'd be taking over is high enough that the monthly payment burden makes the deal unworkable for us, the structure doesn't fit. A cash buyer paying 60% may still be the right answer.
Sub-To pays any seller equity above the loan balance as a down payment, but the loan balance itself isn't paid off — it stays in place. If the seller specifically wants the full purchase price in cash on closing day, that's a different product than Sub-To.
If the home needs more work than the existing loan can comfortably carry through, a cash investor who plans to rehab is the right buyer.
If you tell us where you are and the rate / equity / condition picture, we can be honest with you about which path fits. If Sub-To doesn't fit, we'll say so and, where we can, point you toward someone who buys for cash at honest numbers.
In each of our closes, the seller walked away with the same net they'd have received from a 90-day traditional listing — without the listing, the showings, or the bank approval process. The gap between what a cash buyer would have paid and what we paid in those same five deals was, on average, 30–40% of fair market value. That gap is the seller's equity that would have funded the cash buyer's spread.
A cash buyer gives the seller a closing check and a recorded deed. That's the protection: the money is in hand, the deal is done. A Sub-To buyer demonstrates protection differently, because the seller's mortgage stays in place after the deal closes. We do that with three named pieces, recorded or written into the closing documents.
Every monthly payment routes through an independent loan servicer — a separate company whose only job is to receive money from us, send it to the lender, and report. The seller gets monthly written verification on a paper trail that doesn't depend on us.
Because the loan stays in the seller's name and payments continue on time, the on-time history continues registering on the seller's credit report as a positive tradeline for as long as the loan is in place.
A cash buyer offers none of those because they don't need to — the cash itself is the protection. A Sub-To buyer who can't name those three pieces is not a real Sub-To buyer.
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