Selling a house takes a lot of patience. Many wonder why is a cash offer better for a seller. Traditional selling methods involve hiring a Realtor, timing the sale perfectly with market trends, and scheduling showings with potential house buyers. It can take many months to close a sale, time some homeowners don’t want to waste on waiting around.
Many homeowners don’t realize they have another option. Selling a house for cash gives them the opportunity to sell their home quickly and for a fair price.
What Does it Mean to Sell a House for Cash?
Selling a house for cash is exactly what it sounds like. Instead of waiting on a buyer’s mortgage loan to go through, sellers receive an offer and funds are transferred by cashier’s check or electronically in as little as one week. Potential cash buyers will tour the home and make an offer. If the seller agrees, the closing process begins.
Reasons to Sell a House for Cash
“Every sale has 5 basic obstacles,” says the famous author, salesman, and motivational speaker Zig Ziglar. “No need, no money, no hurry, no desire, no trust.” Traditional home sales methods often struggle with need, money, hurry, and desire, making it a frustrating and sometimes heartbreaking undertaking.
Still, selling a home for cash can make homeowners wary, fearing they will be given a bad deal. Though it may seem like this method of selling a home can’t be trusted, there are several significant benefits to cash sales, including the following:
Sales Don’t Fall Through as Often
Sales are Much Faster
Houses can be Sold “As-Is”
Having a sale fall through at the last minute is common when selling a house. This is often because the potential buyers find out they don’t qualify for a home loan after the seller accepts their offer. The buyer will occasionally decide they no longer want the house, forcing the seller to start the process over.
With cash sales, homeowners need not worry about the sale falling through. Once the cash is in their hands, it is theirs to keep. This makes the selling process much simpler and less stressful.
There are many factors that slow down the selling of a house using traditional methods. Finding an offer that the seller agrees to can take several weeks to months, and then the process of closing the sale can take weeks. Lenders slow things down by doing their due diligence when considering someone for a mortgage loan and home inspections can take time to schedule, further adding to the amount of time it takes to sell.
When a homeowner sells their house for cash, they bypass most of the processes that hold back the sale. They can usually find a buyer within a few weeks, and sometimes even as little as a few days. Once a buyer is found, selling the home for cash goes much faster, giving the homeowner quick cash and relieving a lot of their stress.
Homeowners often must spend a significant amount of money on their home before they can sell it. Not only does the house need to be in decent repair when it is listed on the market, but it needs to be attractive. Homeowners sometimes need to repaint rooms, replace carpets, and perform other time-consuming and costly upgrades.
When someone sells their house for cash, they don’t need to go through the extra steps to make it attractive to potential buyers. Most cash buyers are looking for houses they can repair and sell for a profit, so sellers will find an eager pool of potential buyers waiting to give them the best offer they can.
Working with a real estate agent comes with hefty commission fees that can cost between 5 and 6 percent of the price of the home. That means that when a house sells for $100,000, as much as $6,000 goes to the real estate agent, and sometimes it’s even more. Most of the time a cash sale does not require the help of a real estate agent or broker, so there are no fees to pay.
A foreclosure can drop a person’s credit score from anywhere between 85 to 220 points, according to FICO, which focuses on credit scoring services. (1) Homeowners understandably want to avoid this happening at all costs, but may end up facing this reality if they fall on hard times financially. If this happens, selling their house for cash can get them out of debt and away from foreclosure fast.
How to Find a Cash Buyer for a Home
The first step in selling a house for cash is finding a reputable buyer. Sellers need to do their research before accepting an offer, as some buyers have predatory practices that can leave sellers wanting at the end of the transaction. There are several avenues to consider when sourcing a cash buyer, including:
Talk with Real Estate Agents
Search Public Records
Look for Local Street Signs
Find a Reputable House Buying Company
The traditional way to sell a house is by working with a real estate agent. Most people don’t realize that they also have great leads on cash buyers. Homeowners should be aware of any fees that may be incurred by consulting with real estate agents before using this method to find leads.
Craigslist is a great resource for buying and selling many things, including houses. Many cash house buyers post ads on Craigslist hoping to find a person who wants to sell their house for cash fast. Homeowners must use caution, as Craigslist is also a host to a range of scam artists.
Paper records of all house sales are available locally, usually at the town hall. When a house is purchased with a mortgage loan, there will be documentation showing the details of the transaction. If the house is bought with cash, loan documentation will not be included.
Homeowners can search public records to find houses that were sold without using a mortgage loan and then contact the buyers to see if they are interested in buying their house. However, this is a tedious method, as there are countless houses in every town and finding information on each one will take a lot of time.
Most people in suburban areas have seen signs around town that state, “We pay cash for houses.” Those looking to sell their house can scour local areas to for these signs and use the contact information listed on the sign to get in touch with local cash home buyers. The potential for scams can be high, so it is critical that sellers use caution when speaking with these buyers.
By far the safest and most reliable method of finding a cash buyer for a home is by contacting a reputable home buying company like Gem Homes. Gem Homes cares about helping the people they work with and take pride in giving homeowners the solutions they want. They make selling a house fast for cash a simple and enjoyable experience.
Top 3 Reasons People Pay Cash for Houses
The benefits of selling a house for cash are clear, but the reasons a person or company may buy a house for cash may not be as obvious. Most cash home buyers are wholesalers or investors, looking to make a profit by renting or reselling the homes they buy. There are three key ways that these investors make a profit on homes they buy with cash, including:
High-Volume Quick Sales
Rental investments are rising in popularity, and many of these investors pay cash for the property they intend to rent. After they make sure the house is suitable to rent out, they use these properties to generate passive income. These properties can be maintained for years, and many investors use this to fund their retirement.
TV shows, like HGTV’s “Fixer Upper,” have recently generated significant interest in flipping houses, and real-life investors who flip houses buy their properties with cash. They search for houses that can be upgraded easily, then fix them up enough to be listed on the market and try to sell them for a profit.
High-volume house buyers focus their cash purchases on homes that are in good condition. They do not invest a lot of time or money in repairing the house, so the profit margin is not as high as it would be for a typical house flip. Instead, these investors rely on a high volume of sales at once to turn a profit.
Are You Ready to Sell Your Home for Cash?
Most homeowners can’t afford to wait 3, 6, or 12 months to receive a reasonable offer for their house. Selling a house for cash helps them close the sale and get money in their pockets faster. Reputable companies like Gem Homes work closely with homeowners to get them the results they want without the hassle of working with a real estate agent and listing their house on the market. Contact us today.