Home buying companies are one of the fastest-growing ways to sell your home.
Rather than dealing with a real estate agent and placing the home on the MLS, the homeowner can sell directly to a professional home buying company who is ready to buy your home. When selling to these companies, you don’t have to do any repairs, move anything (except your personal things), or worry about cleaning your home. You can leave your home exactly how it is and the home buying company will buy your house for cash in an “as is” condition.
If you need to sell your home fast, choosing a company that buys houses may be your best option. Not only can you sell your house in under 14 days (sometimes as little as 7), but you don’t have to spend thousands of dollars making repairs or have the hassle of scheduling contractors or handymen. You can also avoid the constant cleaning that comes with showing a house at a moment’s notice, and the back and forth that sometimes comes with offers and contracts. A home buying company can save you time and money.
Advantages of Selling to a Company that Buys Houses
Simple and Stress-Free
If your home needs repairs, scheduling and paying for the materials and labor can be overwhelming. With a company that buys houses you don’t have to worry about the stress of fixing your home up. They will buy your home in “as is” condition which means you can leave your home exactly how it is. This will free up your time to focus on other things like finding a mover.
Flexible Financing Solutions
Maybe an all-cash offer doesn’t work for your financial needs. Some companies are able to work with you to find a solution that fits your financial situation. They may be able to pay for your moving expenses or take over your existing mortgage. With the ability to structure different financial solutions, a cash home buying company is a great option.
Avoid the Traditional Home-Selling Process
Let’s face it, the traditional home-selling process can be awful. Finding a reputable real estate agent is time consuming and difficult. You may have to interview numerous realtors before you find the right one. Even then, they might not be able to sell your home in a realistic time frame.
Not only is finding a real estate agent challenging, but showing your home can also be very inconvenient. Planning an outing to keep your kids busy and making sure you’re out of the house long enough can become a daily occurrence. Not to mention cleaning the house 7 days a week which is time-consuming. When selling to a company that buys houses, you avoid the headaches of the traditional home-selling process.
Fast Closing
Since companies that buy houses pay with cash, they can skip traditional bank financing. Without having to wait for banks to approve a loan, they can usually close as soon as the title work is finished on your home. This can take about 7-14 days, assuming the title is clean. If there are liens or judgements against the property the timeframe could take a little longer. Even so, this is still about a fourth of what traditional financing with a bank takes and much less risky. With bank financing, the process could take 60 days or longer depending on the bank. And those 60 days don’t even start until you’ve settled on a contract with a potential buyer.
Maybe your interest has peaked, but you’re wondering if “companies buying houses” are legitimate.
So how do you determine if a company that buys houses is credible?
How do you know if local house buying companies are honest?
Well, sometimes they all look the same at the start, but we’ll walk you through some things to look for in a local house buying company before you should work with them.
Buying and selling houses is a valid and respectable profession that can help communities and house sellers in many ways. But just like any other line of work, a minority of house buyers in any market are the ones that make the rest look bad.
There are people who are really great ethical folks who improve their neighborhoods one property at a time.
And then there are shady dishonest people who put money ahead of the well-being of their clients and who would sign the contract to sell their own grandmother with one hand while stabbing you in the back with the other as long as they were making enough money.
Yes, they are out there. But let’s not focus on the negative just yet.
We’ll help you avoid these “shady house buyers” so you can work with honest, ethical, and reputable local companies who can buy your house for a fair, all-cash offer and close on your schedule. First let’s discuss what the best house buyers are doing.
What Reputable House Buyers Are Doing
Reputable house buyers are helping folks improve their lives by accessing the money they need right away. People often need the equity in their house to cover unexpected medical expenses or to relocate to be close to a relative. A house buying company can make that happen in just a few days and deliver peace of mind.
They also help sellers get rid of a burdensome property needing serious repairs without the hassle of having to list it with a broker and possibly wait months and months for a sale.
These companies are also working to create local jobs. House buying companies hire plumbers, contractors, electricians, title reps, landscapers, and other people along the way. House buying companies, through their investments, help create real jobs for people.
Most reputable house buying companies also make it a priority to buy U.S. products. They spend tons of money on materials that are made right here in the USA; again, creating jobs in our timber mills, factories, supply shops, distribution centers, and more. The U.S. economy depends on improvement, and that requires investment from people like house buying companies.
Home buying companies can increase the value of neighborhoods. When a cash buying company improves a house, they’re helping the value of the entire community. They often repair abandoned and neglected houses, turning them into beautiful homes for families. That activity strengthens the entire area.
They can also increase the tax base. When a new buyer takes over a property that has been improved, they’ll pay a higher tax rate based on the new and refurbished value. Those taxes go to pay for schools, fire stations, police, libraries, streets, and other valuable pieces of infrastructure, all going towards improving neighborhoods.
So let’s get back to how you can use information contained here to find out if someone is a credible investor and not just pulling a house buying scam. Ask some open-end questions like:
- How do you help your clients?
- What do you do for people?
- Can you tell me more about your services
- What aspect of the business makes you most proud?
- How would you describe your investment policy?
- How can I know that you’ll close on my house when you say you will?
Tips on What to Look for (and What to Avoid) When Dealing with Cash House Buyers
Money should only go in one direction, from buyer to seller
At no time should you be asked to pay money to a house buyer. Money goes from buyer to seller and never in the reverse direction. Legitimate cash buyers do not charge you to come to evaluate your home, to provide you with a written offer, or to do any type of inspections. Closing costs are typically paid by the buyer in off-market cash sales. If a company tells you they have administration, contract, or processing fees, or asks you to wire them money, you should run in the opposite direction.
You want a contract that offers you protections
Most legitimate companies will use the standard real estate commission contract of that state. You want to ensure the contract doesn’t leave a bunch of loopholes that allow the buyer to leave you stranded at the closing table without them incurring any financial repercussions. A lack of loopholes is especially important if you have a firm date you need to sell by.
The buyer should be willing to put down earnest money
Legitimate buyers are willing to put down at least 1% of the sales price in non-refundable earnest money. Earnest money is a buyer’s financial promise to the seller that they will follow through with their end of the contract. An unwillingness to deposit 1% in earnest money is a sign that the buyer is unsure they’ll close and don’t want to risk any money.
A failure to put down earnest money can also be a sign that the “investor” you’re dealing with is a wholesaler that doesn’t have any money of their own. While there is nothing wrong with wholesalers, they need to show their good faith and the simplest way is an earnest money deposit.
Reputable buyers don’t use high-pressure sales tactics
If a house buyer tries to pressure you into selling your house and says you have to make a decision today, be leery. Reputable house buying services will make you an offer that will be on the table 2-7 days (minimum) for you to make a decision. The reason a reputable house buyer service does place deadlines on offers is because the market changes and values change week to week depending on other sales in the area. Also they might buy multiple houses per month and when they make an offer they’re assuring you that the cash to purchase your house is ready and it will be reserved for several days so if you do want to sell your house they can close on schedule.
Most scammers are looking for a quick score and not an in-depth interview. Chances are good they’ll find excuses to get off the phone and move on to someone who doesn’t ask too many questions.
Smart investors don’t sign contracts blind
A reputable buyer may make you an offer, or give an offer range on a home sight-unseen, to see if you’re both in the same ballpark. But, a reputable cash buyer is highly unlikely to sign a contract that provides non-refundable earnest money without seeing the home in person.
Avoid kitchen table closings
If a property buyer tries to get you to sign the deed (ownership) of your house over to them at your house rather than at a professional place like an attorney’s office or title company, be wary. A reputable house buying company will perform the actual closing of the sale at a neutral 3rd party place. This ensures everything is done right and on the up and up.
Real companies have a verifiable business presence
If you are dealing with a legitimate company you should be able to find information about them via an internet search. They’ll have a basic business presence. They’ll tell you about their company and its owners on their About Page. The company’s contact page should give multiple methods of contact, including email, phone numbers, and postal mail address.
Seek out the experience of past clientele
Look for reviews and testimonials from past clients on their website. If possible, try to contact past sellers. Most reputable companies will be happy to offer you references from previous clients, and any clients who have been pleased with the process should be happy to give you a few minutes of their time to answer any questions.
Always trust your gut
If someone makes you feel uneasy, there is probably a reason. Trust your instincts, combined with the above tips, to ensure you will work with a reputable buyer who will close on your home as agreed.
Whether or not you should sell to a company that buys houses is ultimately up to you. Make sure you work with a company that matches your schedule, financial situation, and comfort level. If you’d like a free, no obligation cash offer for your home from a legitimate buyer, call Heart Acquisitions at (843) 227-1918.