When you’re selling a house, most homeowners clean it up, declutter, call an agent, calculate an asking price, list the place, show the home, negotiate, address repair requests, and wait weeks for closing. The process can be long, stressful, and frustrating. But there might be a better way.
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Four Benefits of Selling for Cash
The data shows that 91 percent of all homes for sale are listed on the multiple listing service (MLS). That means less than 10 percent are sold in a for-sale-by-owner (FSBO) transaction.
Just because most homeowners use the traditional method, however, that doesn’t necessarily mean it’s always the best way to go. Cash home selling has become a more popular option in recent years — and there are plenty of reasons why.
Here are four of the top benefits:
1. Quick Close
It takes an average of 45 days to close on a home purchase. In many cases, however, it turns out to be more like 60 days.
Waiting around for six to nine weeks after accepting an offer on your home can be frustrating and difficult. Not only does this require you to wait on the purchase of your next home, but it also entails the burden of keeping your current property in top shape.
If you have a cash buyer, there’s no approval process, appraisal, or due diligence period. In many cases, a cash home buyer can purchase your property within seven days. That enables you to get out quickly.
Selling a home quickly is advantageous for a variety of reasons. For one, it frees up cash sooner and allows you to move that money into another investment or financial vehicle. Secondly, it reduces the liability. Regardless of whether the house is under contract with a buyer or not, it’s your home until the title switches hands at the closing table. Anything that happens in the meantime – like a tree falling on the house or a pipe bursting and flooding the downstairs – is your responsibility. With a faster sale, you reduce the holding time, which substantially lowers your risk.
2. Less Chance of Deal Falling Through
When you’re entertaining an offer from a traditional buyer, many factors could cause the deal to fall through before you arrive at the closing table. These include issues with financing, contingencies related to the sale of another home, and/or problems that may arise during an inspection.
There’s an adage in the business world that says time kills deals – and it holds true in the world of real estate. The longer a house sits under contract, the more likely it is that some issue will emerge that will cause the deal to fall through. A quick close reduces this risk.
Depending on the year, somewhere around six percent of accepted offers won’t make it to closing. With a cash buyer, there are no contingencies; it happens quickly and cleanly.
3. No Inspections or Repairs
If you’re worried that your home might be breaking down and has a bunch of issues that would pop up with red flags on an inspection report, working with a cash buyer can alleviate the stress and expense.
Although you still have to disclose any issues that you’re legally required to mention, you won’t have to deal with an inspection report and a long list of repair requests. The cash buyer simply inspects the property and assumes the risk.
While a savvy cash buyer will be able to add up some of the obvious costs and account for these expenses in their offer price, there’s less of a risk of unknown factors emerging. For example, he probably isn’t going to crawl around the entire crawlspace and inspect every inch of the attic (like a certified home inspector would). This benefits you as the homeowner.
4. No Real Estate Commissions
When selling a house, you’re responsible for paying six percent of the sales price in commission (three percent to your agent and another three percent to the buyer’s agent). When you have a cash buyer, however, you can save this six percent off the top.
On a $400,000 house, that could be worth $24,000. The cash buyer might offer you $20,000 or $30,000 less than you’d get on the MLS, but the lack of a six percent commission could largely equalize that.
How to Sell Your House for Cash
The benefits of selling a house for cash should be clear. The question is: What does it look like? In other words, how do you go about selling your house for cash?
The first step is to find a cash buyer in your area. Thanks to the Internet, this is a lot easier than it used to be. Simply run a Google search for something like “cash home buyer + your city.”
For example, if you search for cash home buyers in Long Island, you’ll end up on the WeBuyHousesFastLongIsland.com website (which is a family-owned business in the area). Once you find a potential cash buyer in your area, ask them about the process.
Typically, it’ll look something like: (1) send info, (2) wait for the buyer to reach out, (3) obtain an offer, and (4) get paid.
You’ll ultimately have to decide what your priorities are when you sell a house. If you want to squeeze every last penny of value out of the sale, promoting your property on the MLS with an agent should empower you to do that.
But if you’re more interested in a swift, stress-free process that allows you to move on to the next phase of your life right away, a cash buyer is a great option. It’s simply up to you and your preferences.
With so many cash buyers to choose from in a market like this, you can be discerning. Look for a cash buyer who is professional, experienced, and courteous. This can be a rather intimate process, and it’s a good idea to work with someone who is going to care for you and your home throughout the process.