“We’ll Buy Your House for Ca$h!!” – Everyone has seen this written in marker on a cardboard poster or sign on street corners or where you exit the freeway. But, how legit are cash home buying companies? What’s the difference between the different “We Buy Houses” companies and how can you distinguish between them? These are just a few of the many questions we hear from homeowners, clients and sellers in general about selling direct to an investor. The truth is: all home buying companies are different, and there are absolutely pros and cons in selling to one. We’re here to provide you with a very transparent breakdown of those advantages and disadvantages, and give you some tips in finding the right cash home buyer (should this option fit your needs).
Pros and Cons of Selling to a Cash Home Buyer
Let’s face it- selling to a cash investor is NOT for everyone. As with any transaction or service, there are both advantages and disadvantages to the client…depending on your situation and the company you select to sell to. Most people who choose to sell to a cash home buying company do so for the speed of sale and convenience, especially when facing foreclosure or relocation. But, here is a breakdown of both the pro’s and con’s.
Pros in selling direct to a buyer:
- Time: As mentioned above, one of the best things about selling direct to a buyer is the speed in which the sale can take place. Many home buying companies guarantee to buy your house within days, or weeks. For folks in a time crunch, whether that’s facing a home sale auction or bankruptcy, this can be a real life saver. A traditional sale can take an average of 69 days. So, if moving quickly to unlock the equity in your home is a priority, this is a very important distinction.
- Buyer financing: Unlike the traditional home sale, there is no waiting on buyer financing. Buyer financing can be a nightmare when lenders delay or slow down closing, sometimes forcing buyers to rescind their offers altogether. Most investors have cash to pay for your home, so this means no delays or hassle in relation to financing the purchase.
- Creative Solutions: Because investors have the capital to buy your home with cash, they also have the ability to provide more unique solutions. For example, if you’re underwater on your mortgage, some investors will take over your mortgage altogether. Ask us about seller carry-back, and other flexible financing solutions.
- Construction: If your home is in need of a major roof repair or the entire kitchen needs an overhaul, you can sell it as-is to a cash home buyer without touching a thing. Unlike a traditional buyer, investors see these repairs as opportunities (not burdens). This means that you don’t lift a hammer or put any of your own money into making repairs.
Cons in selling to a cash buyer:
- Market value: Selling to an investor AND getting top market value for your home is unlikely. Investors have to buy your home knowing that even after holding costs, paying closing costs and commissions, and paying for repairs, that they will make a profit. After all, this is an investment and a risk for the buyer. So, no, you usually won’t get top dollar from an investor. But, don’t forget all of the fees and commissions you are avoiding in selling direct to a buyer…in the end, what you walk away with may not vary all that much.
- Scams: Unfortunately, there are scams out there and companies who give other investors a bad reputation. You will have to do extra research when selling to a cash home buyer to ensure that they are a credible business, one that will not take advantage of the potentially vulnerable situation you are in.
- Licensing: Technically, investors do NOT need a license to buy. Because of this, you don’t know anything about the person or entity offering to buy your house (without doing research). Some investors are actual corporations, and others are individuals who are also real estate agents. This can be concerning for some sellers because the motive in purchasing your home is unclear.
Finding a Reputable Cash House Buyer
- If this buyer claims to be a credible company, are they listed on your local Better Business Bureau? Do they have a Yelp or other local listing? Do they have reviews (including videos) from real sellers who have dealt with them?
- Protect yourself. If you have a family lawyer or even an agent that you trust, have someone else review the offer that a cash buyer has provided you. Also, ensure that the offer is provided in written documentation versus just a phone conversation. A credible company will provide paper documents to review, and will typically review with you in great detail.
- Do your homework. The best way to ensure that you aren’t given a low-ball offer or taken advantage of in any way is to do your homework. Hop on your computer and dig into what other homes are selling for in your area, and in what condition. Getting an idea of how your local real estate market is performing will give you a better idea of what you can and should get for your home.
How Sell Your House Direct Has Become a Trusted Resource for Sellers
It’s simple. Really simple. We have become a reputable company in San Diego by not hiding ANYTHING. We provide honest solutions and transparent communication to our clients and our partners. If you are interested in receiving a cash offer- we’ll ask you questions to better understand your selling situation. If you are better suited to sell via a real estate agent, we would be the first to tell you so. We walk our sellers through the process step by step, ensuring that our team makes you feel not only comfortable with the steps, but confident in your choice to sell direct to a cash buyer. You can find our company on the BBB, read reviews about our product and service on Yelp, and listen to countless REAL homeowner testimonies on our website.Views: 21