Life has a funny way of throwing a monkey wrench into even the best laid out plans, doesn’t it? We may have a well-planned timeline of when we want to sell our house, but sometimes stuff happens and you’re in a position where you need to sell your house now. What are your options?
If you’ve considered selling your home for cash and even started checking out those “we buy your house for cash” sites, you’ll want to keep reading. Here are five things you need to think about before selling your house for cash.
1. Direct buyers may buy as-is
Typically when you’re selling your house, you’re going to want to spruce it up and make repairs to get the most money out of your sale. However, if you’re thinking about selling for cash, direct buyers (also called investors) will buy your house as-is. That means you won’t have to put any money toward repairs or upgrades.
Just keep in mind that if you sell it as-is, it’s likely that you’ll be presented with an offer that is below asking. If you’re curious about how much you can make from your as-is sale, you can use a net proceeds calculator and compare it with how much you could get if you made some repairs and upgrades. Your agent can help with this by looking at comps in the area.
2. Contingency clauses may be avoided
When you’re selling a house, a buyer has the option to include contingency clauses in the contract. Contingencies allows the buyer to back out of the transaction for one reason or another. The most common contingencies are:
- Home appraisal
- Home sale
- Home inspection
Yet if you’re selling for cash, those contingencies can be avoided for the most part. The investor still will want inspections and appraisals, but they are less likely to be as vigilant as your average buyer.
3. Financing isn’t a headache
One of the main reasons closing on a house takes so long is because lenders need to be involved. The buyer has to get approved for a loan and sometimes that can take a while, however on average it usually takes 44 days to close. A buyer who is paying cash already has the funds available and it’s just one less obstacle to get past.
4. Sales are quicker and easier
There are a lot of things a seller has to go through from the moment they hire an agent until the closing documents are signed. They have to fix up the place, hire photographers and stagers, work with an agent to figure out a marketing plan and so on.
With cash buyers, the process is incredibly simple. The process is a lot quicker and could save you the search for Bridging Finance for another property. You can have the money in your hand before you have even thought about buying somewhere new. Most cases, you’ll contact an investor (either you found them online or through an ad) and they’ll ask you a few questions. They’ll run the numbers and give you an offer. If you accept, you could have a nice chunk of cash in your hand within a couple of weeks.
5. You can get scammed
As good as selling for cash sounds, there’s always the possibility of getting scammed. Cash buyers or investors don’t need to be licensed in order to do business. Because of this, there are plenty of ways you could be taken advantage of.
If you do decide to go this route, you’ll want to be vigilant and monitor your credit report to make sure no one has taken out a second mortgage on your property. You’ll also want to steer clear of any company that requires you to pay a fee upfront. These types of scammers prey on folks who are in a tight spot and they can talk a good game to win your trust.
Don’t let that scare you though! There are plenty of reputable companies that you can use to sell your house for cash. HomeLight’s Simple Sale platform is a good example of this because every buyer on the network must pass a rigorous vetting process! It may be good to contact people such as the Marandi Foundation too prior to purchasing.