In real estate, one of the most revealing buyer statements you’ll hear is: “I need to liquidate something first.”

It sounds harmless. Polite, even. But under the surface, this phrase can tell you a lot about buyer readiness, timeline risk, and deal security.

Sometimes it’s a legitimate obstacle.
Other times? It’s a subtle signal that the buyer isn’t as “ready to go” as they claimed.

In this article, we’ll break down:

• What this phrase really means (most of the time)

• How to tell whether it’s a red flag or just a timing issue

• What to ask next, without offending the buyer

• How to structure deals around this kind of liquidity delay

• And when to walk away to avoid wasting time

Let’s dive in.

First: Why Buyers Say This

When a buyer says they need to “liquidate” something first, they could mean:

• Selling another property

• Closing out a retirement or brokerage account

• Moving money from an illiquid business or investment

• Getting funds released from a partnership

• Waiting on an incoming deal to close

On its face, this sounds like a responsible move. They’re telling you they do have the money… but it’s temporarily tied up.

The problem? There’s no guarantee of speed.
And speed, in real estate, equals certainty.

The 3 Main Buyer Types Who Say This

1. The Asset-Rich, Cash-Light Buyer

This person might own millions in real estate or stocks, but they don’t have liquid cash ready.
They’ll say things like:

• “I have the funds, just not in this account.”
  
  
  

• “Once my other flip closes, I’ll wire everything.”
  
  
  

They’re probably legitimate, but risky.
Why? Because if their other deal stalls, your deal stalls too.

2. The Overcommitted Opportunist

This is the buyer who’s chasing too many deals at once.
They’ve made soft commitments to multiple sellers, but only have funds for one.

They’re using your deal as an option, not a priority.

This buyer is dangerous because they might bail last-minute if something better closes first.

3. The Bluffing Buyer

Sometimes, “I need to liquidate” is code for:
“I don’t actually have the money.”

They hope to find the funds once they have a deal under contract, either by:

• Shopping the deal to other buyers (wholesaling)

• Scrambling for a private lender or hard money

• Borrowing from a partner who hasn’t even agreed yet

These buyers are the riskiest of all.

The Key Question: Is the Delay Predictable or Unpredictable?

Here’s the litmus test:

Can they tell you exactly what they’re waiting on, when it will be available, and show some proof it’s real?

If yes, you may be able to structure the deal to work around the delay.

If no, you’re likely dealing with a buyer who’s not ready to move forward.

Follow-Up Questions That Reveal the Truth

You don’t need to interrogate your buyer.

Just ask calm, professional questions like:

• “Totally understand. What are you liquidating?”

• “What’s the expected timeline?”

• “Has that transaction already started, or is it still pending?”

• “Will those funds be wired directly to escrow, or are there steps in between?”

Their tone and detail level will reveal a lot.

A buyer who has a plan will speak clearly. A buyer who’s stalling or hoping will get vague, fast.

How to Structure Deals Around Liquidation Delays

If the buyer is trustworthy but needs a few days or weeks, here’s how to protect yourself:

1. Use a Short-Term Option or Reservation Agreement

You give them a brief window (3–5 days) to get liquid, in exchange for a small non-refundable fee.

This buys them time without tying your hands for too long.

2. Set a Hard Deadline with Automatic Release

If they insist on contracting now, write the funding deadline into the purchase agreement.
Example clause:

“Buyer shall deposit $X in escrow no later than [date], or the contract shall be considered null and void without penalty to the seller.”

This protects your deal flow.

3. Ask for Partial Earnest Money Now

If they’re serious, they’ll put something down today, even if it’s not the full amount.

This shows intent.

If they can’t or won’t? That tells you everything you need to know.

Red Flags to Watch For

If you hear “I need to liquidate something first,” and any of the following is also true, proceed with caution:

• They can’t explain what they’re liquidating

• The liquidation depends on another contingent event (e.g., “If my partner wires it”)

• They want you to hold the deal with no money down

• They don’t want to show POF until after they lock it up

• They’re vague about timelines (“Soon,” “By next week maybe”)

These are all signs that you’re being strung along.

What Motivated Buyers Do Differently

Compare that to what a real, motivated buyer says:

“I’m liquidating stocks this week. They settle Thursday, I’ll wire Friday. Happy to put $5K in escrow today to show I’m serious.”

That’s the tone of someone who’s organized, confident, and used to closing.

They name numbers and commit dates.
They offer deposits without being asked.

This is what you’re looking for.

When to Walk Away

If you’ve gone through the conversation and:

• The buyer is vague

• Won’t commit to deadlines

• Can’t put anything in escrow

• Or changes their story midway...

It’s time to move on.

Why?

Because availability of funds is binary: they either have them or don’t.

And if they don’t have them now… they may never get them.

Your Time Has Value

There’s nothing wrong with a buyer needing to shift money around.
That’s life. That’s business.

But there’s a big difference between:

• Temporary delay with transparency
  
  

• Stalling tactics with no proof

If a buyer can’t move at the pace the deal requires, you can’t afford to pause everything else waiting on them.

Time kills deals, and slow money is often no money.

Final Thoughts

“I need to liquidate something first” is not a disqualifier, but it is a test.

It tests:

• How serious is your buyer really is

• Whether they’ve done this before

• And whether they’re transparent about their process

Don’t assume the worst. But don’t let optimism blind you either.

Ask the right questions. Set the right boundaries. And only lock up deals with buyers who prove, not just promise, they’re ready.