4 Ways to Know if You Should Accept a Cash Offer on Your House
A 2022 study found that 65% of homeowners would consider selling to an i-buyer, or other cash investor. But is it a good option for you? Here’s four ways to know if you should consider accepting a cash offer on your house.
What is a real estate investor?
A real estate investor is a home buyer that pays cash for properties with the intention of holding them or flipping them for a profit.
Some of the benefits of selling to an i-buyer or real estate investor include: closing faster, selling without repairs or renovations, and avoiding paying real estate agent commissions.
But when should you use a real estate investor for your home sale?
1. You want an hassle free sales process
If the idea of finding a real estate agent, signing a listing agreement, cleaning, repairing, staging, and showing a home doesn’t sound appealing, you could benefit from a cash sale.
Most cash buyers purchase as-is, meaning that they buy the house in its current condition without any requests for repairs.
They simply provide an offer on your home and if you accept, a few weeks later you close and get paid.
2. You need to sell quickly to buy your new home
The real estate market has been hot across the nation. Most homes don’t linger on the market. When you find your dream home, you have to be ready to sign the contract. Unfortunately, that leaves you scrambling to sell your old one.
A cash sale with a real estate investor can close in as little as seven days. If you are financing the offer on your new home, you can quickly establish a concrete offer to help your mortgage lender get you approved. Additionally, you won’t have to risk an overlapping mortgage payment.
3. Your house needs repairs and you can’t afford them
Lenders have specific requirements for home purchases. If your home needs major repairs, it’s unlikely a buyer will be able to acquire a loan for it. If finances are tight, spending tens of thousands on renovations won’t be possible.
You can save money with a cash investor by selling without repairs. And you’ll additionally save on surveys, inspections, and closing costs.
4. You have a second home with bad tenants
Bad tenants are a nightmare to any landlord. Missed rent payments quickly add up to the tens of thousands, and residential evictions are a slow and costly process. It can take months or even years to remove a problem tenant. During that time they cause untold amounts of damage, and make maintenance an issue.
One of the benefits of accepting an offer from a cash buyer is that they will deal with the tenants. You can sell the house occupied, avoiding evictions and other difficulties in selling your home.
Accepting an offer
Be sure that the offer to buy your home that you accept is a comparable sales price to other homes in your area. A good investor will usually offer 80-85% of the repair value of the home, which will net a majority of sellers similar amounts as would come from a traditional sale, without the hassle.
Hopefully these tips will help you make a decision when accepting a cash offer on your house.