Wednesday , April 14 2021
Selling a house for cash

How to Sell a House for Cash: A Detailed Guide

A cash home sale takes more work than many realize. To sell a house for cash effectively, you need impeccable research skills. Research may involve finding the right buyer and researching their reputation. As an alternative, you can attract buyers without seeking them out.

Selling a house for cash has become a booming business, and many buyers will compete for your home. If you’re in a seller’s market, you can choose from multiple cash offers.

This article will show you some vital home selling tips in greater detail. Read further to know more.

Find a Cash Buyer

There are a variety of cash buyers to consider. You can find individual cash buyers, including small or large investor companies. Many cash buyers are looking for a bargain and may want to purchase your home for less than the asking price.

Investor buyers are usually looking to purchase properties below market value. This is because they buy properties at low prices, renovate them, and sell them for a higher price.

If an investor buyer offers an unsatisfactory amount, you can negotiate for a higher sum. However, ensure that your asking price coincides with the true value of the home. All too often, sellers list properties far beyond the home’s value.

That said, many cash buyers are flexible and will buy your home at full price. For example, David Buys Houses will buy your home at a full price under the right conditions.

Therefore, check with an agent to assess the value of the property. They will conduct a comparative market analysis on your property to pinpoint its true worth.

You can also choose between using an agent or dealing with an investor buyer directly. An agent would be ideal under the following conditions:

  • Your home is in impeccable condition
  • Your home doesn’t need any repairs
  • You have time to wait

If you choose an agent, consider the commission you must pay. Generally, real estate agent commissions are around 6%. On the other hand, an investor buyer is preferable if your home isn’t in the best condition and needs many repairs.

Moreover, an investor buyer is the better choice if you must sell your home quickly. Investor buyers usually work with motivated sellers eager to sell properties.

With an investor buyer, you don’t have to worry about renovations or repairs. The investor will handle the upgrades, and you can sell the property as-is.

Attracting Cash Buyers

In other cases, sellers don’t have to seek buyers out. Instead, many sellers drop clues in their listings to attract cash buyers.

For instance, many sellers will include phrases such as ‘motivated seller.’ When cash buyers see this phrase, they know the seller is open to a cash offer.

You can also convey that the property is For Sale By Owner (FSBO). Cash buyers are always on the prowl for FSBOs who want to sell their homes without an agent.

Research the Buyer

You’ll find a slew of ‘We Buy Houses’ signs, but some buyers are disreputable. Unfortunately, the cash-buying business has its share of scammers.

At a minimum, the buyer should have a website for reference. Professional companies usually have a customer service center as well. If the buyer doesn’t have a website, or cannot be reached easily, you may be dealing with a scammer.

  • Note: A cash buyer should be willing to put down a deposit in the range of 3-4%. In other cases, you can ask for a proof of funds letter to determine if the buyer is serious.

Plus, professional buyers usually abide by state regulations and have BBB verification. In other cases, the investor buyers have a real estate license as well.

That said, you’ll find individual cash buyers who don’t BBB verification or a customer service center. However, they are just as reputable nevertheless.

They should have extensive knowledge of local markets and positive word-of-mouth. You can ask around town about the buyer, or you can check online reviews. Above all, the buyer should have some type of experience in the real estate field.

Accepting the Terms

After you accept the buyer’s asking price, the home sale process will proceed like any other sale. Many people think a cash offer entails someone showing up with a check, but you must still go through the standard home-buying process.

The good news is that cash transactions offer shorter closing times because a lender isn’t involved. On average, cash transactions take two weeks, whereas conventional sales involving a lender last around 45 days. Lenders prefer to appraise the property first, and the buyer must go through the approval process.

When dealing with cash transactions, review the purchase agreement carefully before signing. You can also have an attorney review the contract. The contract should contain the following:

  • The agreed-upon asking price
  • The deposit amount
  • Closing date
  • Home inspection provision

Some buyers may want a home inspection while others will waive it. The agreement may contain other unique provisions that you must spot early. If you live in an HOA, for example, the association may need to approve a buyer’s application.

Sell a House for Cash the Right Way

To sell a house for cash without fail, you can seek out cash buyers on your own. You can also attract cash buyers using ads. From there, ensure the buyer has a good reputation. Then, review the purchase agreement thoroughly after accepting the offer.

Confirm that the purchase agreement is correct and doesn’t contain provisions that could delay the closing process.

Interested in learning more? Read more on our blog to gain insight into other topics.

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