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Selling Your Home to Real Estate Investor? Advantages and Disadvantages
Real Estate
Selling Your Home to Real Estate Investor? Advantages and Disadvantages
If you want to sell your home as soon as possible, then signs reading “We Buy Houses for Cash” must have attracted your attention.
So who are these people promising to buy your home fast, and that’s too for cash?
They are basically real estate investors who want to buy your house to make money. They may either sell it to other homebuyers or put it on rent.
As you want to sell your home quickly, you are less likely to bother why anyone is interested in your property and give you cash for the same.
Although selling your home to a cash buyer is surely beneficial, it may come with some downsides.
Here we will discuss the pros and cons of selling your home to a real estate investor.
PROS OF SELLING YOUR HOME TO REAL ESTATE INVESTORS
As Is Purchase:
Whether your home is ugly, disputed, or haunted, most real estate investors will buy it in every condition. It simply means that you don’t need to spend money on its revamping or wait for the buyer until the dispute is over. They are also a life savior for people facing foreclosure due to financial problems. They will also buy property if you have had to relocate quickly.
Flexible Payment Options:
Many real estate investors offer various payment methods like cash, pre-scheduled cash payments, and certified funds or they may even pay off the existing mortgage completely. With a range of options available, you can find a method that can go well with your needs.
Fast Closing:
Generally, real estate investors can close within a week. This is because the sale of the property is not determined by appraised values, home inspections, and finances. They purchase with all cash, meaning that your property is sold once you agree on the conditions. However, it may take two months if you are selling to a buyer who requires a mortgage.
No Need to Move Before You Sell:
You can be allowed to live in your home before the sale. The house is not required to be “show ready” for months on end while looking for a buyer. This is because the investor buys it as-is and is less likely to make any improvement until you move out.
CONS OF SELLING YOUR HOME TO A REAL ESTATE INVESTOR
Not Getting Market Price:
The first downside is that your home is sold below its market value. Real estate investors are aware of both the benefits and risks of purchasing a home in any condition. The discount is necessary to sell a house quickly and reflects the “price” of a quick sale. Moreover, investors have to pay for repairs, holding costs, back taxes, and closing costs. So the cash offer below market value can be justified.
Being Unlicensed:
Home cash buyers are mostly unlicensed. This is because they represent themselves in the transaction, instead of representing a buyer or seller. It is as if your neighbor is buying your home by giving you cash. The investors can be individuals or corporations. Therefore, make sure to research them before working with them. Ask about their experience and credentials.
OUR VERDICT:
Selling your home to real estate investors is only beneficial if you want to move out quickly and don’t bother about the price of your home. If you are expecting a true market price for your home, real estate investors are not for you.
Secondly, make sure to research the company or individual before entering a deal with them.
How to Find the Right Real Estate Agent to Minimize Risk
Look for a Local Agent:
A local real estate agent is aware of the area you are looking to buy or sell.
Another benefit is that they will help you negotiate through the process of buying and selling your home, including inspections, showings, paperwork, and closing requirements. One more thing—he should be a full-time agent. This is because many people enter this profession to get rich overnight after being inspired by HGTV.
Ask Friends and Family for Referrals:
This is another way to ensure a safe and risk-free deal. Ask your friends and family members for referrals. You are likely to get honest assessments of their experience with a certain real estate agent.
However, don’t trust them blindly just because they are recommended by your family or friend.
This is because their needs may be different so make sure you understand what exactly beloved one’s aims were and what impressed them most about the agent.
Ask Them to Provide The List of Their Past Clients:
Ask them if they can provide the contacts of their previous clients. A good agent shouldn’t have any problem providing you with a list of their clients. Call a few of them to know their reviews on the agent. This way, you can figure out the quality of their service.
Shop Around:
Don’t settle on the one you come across. Instead, you should contact multiple agencies to find out the best. Although it is an overwhelming process, especially if you want to sell the home quickly, it will benefit you in many ways. You can negotiate with them to see who can offer the best rate for your home. Just like you wouldn’t pick a handyman without meeting them first, feel free to interview them before taking a final decision. Verify their experience in this profession. Make sure that they have been around for at least a few years and are familiar with all the legal implications of such deals. This is because the real estate transaction involves paperwork and legal formalities.
If anyone seems exaggeratedly unrealistic or excited, trim them off your list. After all, you want to work with a real estate agent who is straightforward and honest with you, even if you aren’t getting the expected rates. However, you should never feel as if you’re being insisted to accept an offer you’re not agreed on.
*LEGAL DISCLAIMER
Blog articles are purely for educational purposes and provides generalized information of the topic(s) covered. These articles should not be considered as legal advice.