Does Cash Talk?

Dear Pat
We’ve been saving for some time to buy our first house, but a recent inheritance will enable us to pay cash, if we choose. Our problem (if you can call it that) is that we plan to continue working; since payments wouldn’t be difficult, we can’t decide whether to pay cash for a house or to put the money in an investment with a yield greater than the 6.5% a mortgage would cost us. Generally speaking, could we expect the discount we’d get by paying cash to offset the interest write-off we’d get with a mortgage?
--Nice Choices

Dear Choices,
Whew! Bear in mind that I am but a simple Realtor, and that your “problem” requires the attention of a qualified investment professional who can analyze your situation based on your ages, income, lifestyle and financial goals. I would like to nibble on a point you raise about the choice of cash versus an investment yielding greater that 6.5%. It’s true that some buyers do choose to make a smaller down payment in order to keep cash working for them in higher-yield investments—but again, I urge anyone considering this option to consult with financial professionals. And I want to bite down hard on the notion that a cash buyer can expect a discount. Don’t forget, it’s all cash to the seller on closing day—whether it comes from the buyer’s checking account or their mortgage lender.