5 Easily Avoidable Mistakes to Consider When Working with Cash Home Investors

home investors

Selling a home for cash to home investors is a smart move for many homeowners. If you need a guarantee that your home can be sold quickly, or you don’t have the cash to do costly repairs before selling, or just prefer not to have agents and the general public viewing your home, a company that buys houses is a very viable option for you.

While house sales without an agent are quite enticing, there are several pitfalls that homeowners can fall into if they fail to do their due diligence. As a savvy home seller, here are five mistakes that you will want to avoid when selling a house for cash.

1. Not Qualifying the Cash Home Investors

Reporting to your new job or returning home after inheriting a property can push you to sell your house fast. You may end up skimping on researching your home buyer, which may prove costly in the long run. You need to take time and conduct background checks on the investment company and its representatives. Let them provide a proof-of-cash letter before agreeing to the offer provided. An excellent way to find the right homebuyers is to ask for references and reading reviews from past clients.

2. Spending Money and Time on Repairs

The traditional realtor route may push you to carry out expensive upgrades and repairs to make the property attractive to homebuyers. Some homeowners carry over this notion when selling a home for cash. Most cash home investors buy the property on an ‘as-is’ basis, meaning there’s no need for repairs or home inspections. As a general rule, you can only recoup a percentage return for the improvements made unless you decide to do a full home renovation and then selling with an agent will actually get you a better return.

3. Signing Up a Real Estate Agent

Agents will help you get your home sold, that is a fact. However many homeowners wrongfully list their homes under a real estate agent before starting their search for a home investor. If you are even considering selling to an investor, get an offer from the cash investor before you sign up with an agent. You will have to sign a listing agreement with the realtor and you may have to pay up the agent’s commissions (approximately 3% to 5% of final costs), even if you found the home investors yourself. You generally can get a higher price with an agent selling to a retail buyer, but the traditional home selling option may take an average of 30 to 90 days from the time you accept a buyer’s offer (sale time plus date of possession). If it is listed with an agent and you do decide to go with a home investor to guarantee a quick sale, it likely won’t change the investor’s offer price and you will be out the agent/brokerage fees. There is no obligation to an investor’s cash offer unless you sign a contract with them and if it doesn’t work for you, then definitely go the agent route. If you can wait 30-90 days to close, try to find a company/broker that can help you sell for top dollar AND present a cash offer. If its not selling you can always fall back on the cash offer.

4. Overvaluing of the Property

Cash home offers may not always match the market value. However, you can get a fair price. Know what your home’s market value is and be comfortable with what discount you are willing to offer to guarantee the sale. You do not have to carry out expensive repairs or set aside funds for listing, staging, and photography. However, you may need to set realistic expectations for the value of your house. Overpricing your property can make you lose potential retail buyers, furthermore cash home investors.

5. Having an Emotional Attachment to the Home

While you may have fond memories of the home, bringing emotions to the table can cloud your judgment. You may need to adjust your frame of mind, viewing your house as a property. That’s how the cash home investors will see it.

A reputable cash home buyer can carry out house sales with a quick turnaround time, providing home sellers with an instant, fair offer for their homes. You may need to maintain a sober mindset to avoid falling into such pitfalls. If you need additional information on the home selling process, reach out to us today.

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