Who Are The 'Cash For Home' Buyers? Is It Legit?
Was the 'cash for home' advertisement you went through last week legit? Or it is just a marketing trap of the companies to show you benefits. There are two different schools of thought about 'cash for homes' companies. Some people consider it as an ultimate and legitimate option, whereas others just discharge it from the domain of legitimacy.
To make an informed and realistic judgement about the legitimacy of ' cash for homes' buyers, we need to understand the concept and motive of these offers. We will go through the process with an example, motives, and benefits of the 'cash for homes' to make a decision of falling for these offers or just letting it go. But, before even that, let's look at who are these cash buyers?
Who Are The Cash Buyers?
The literal definition of the cash buyer is any individual or group that has purchasing power to buy a house solely with cash. It doesn't include any mortgage or loan. The definition implies that the buyer must possess the cash amount at the time of offering a purchase to the homeowner.
Who are these cash buyers nowadays?
These are mostly the buy and hold companies, iBuyers, house flippers, and the companies that buy houses for cash and then rent them out. No matter who they advertise themselves to be, they share one common trait of purchasing your house at a value lower than the market. Why should you go for a 'cash for home' offer to sell your house?
Who Should Not Go For The 'Cash For Homes' Offer?
The intent of the home sellers affects their decision of going to sell their house to cash buyers. Anyone who is in dire need of money, or just wants to save their time and money of repairing the house before listing it will go for cash buyers because most of them will purchase your house in its current condition.
Let's understand it with an example. One day you received a call and you were informed about the death of your paternal aunt, and news that you have become the owner of her house in a far off state. Now, what next? You have become the owner of a house without doing anything and unexpectedly. You will just get cash of around $200000 for the house in the current condition. And if you spent money on staging and listing, you have a chance to get a higher amount.
But, you just searched on google, 'sell my house for cash.' And a lot of options will appear. You are just saving yourself from travelling, inspection, staging and listing. You contacted a company saying 'cash for homes.' They contacted you over the phone, some time was taken in negotiation, and they offered you $110000 cash for the house without any hassle. You were happy, and the deal was closed.
A week or two weeks later, you just thought of checking if the house is listed or not. And you just found it listed for $200000. Snap! But it was your own choice! You can't do anything against them.
Who Should Go For A 'Cash For Homes' Offer?
And let's discuss another scenario.
Mis. Marina, a widow women, has become the owner of her late husband's house. She needs to pay a mortgage of $150000 on the house. Whereas she is also looking for a job to support her family. Finally, she gets a call from a company that is offering her a job in another state. They also ask to join within the next 30 days. Now, she has two options. Either to take an additional loan for repairs of house, staging, listing and hiring contractors to renovate the house. Meanwhile, it can take 3 months or 6 months to get a buyer who is ready to buy the house. What will be her struggle? Looking for a new home, paying two mortgages for both homes, focusing on her new job, staying in touch with the contractors and a lot more.
The second option is to go for a 'cash for homes' offer where she is guaranteed to get a cash payment of |$180000 for her house worth $300000. She will have $40000 cash in her bank after paying the mortgage of $140000. So, it will be a good choice for her to go for cash buyers.
Benefits Of 'Cash For Homes'
From this example, we can list some benefits of 'cash for home' offers.
Saves Time
For the homeowners who are facing time constraints have an ideal option of selling their homes to the cash buyers. Although, you will get a lower than market price for your home and that is what you will have to pay for saving your time. You can simply bypass the long process of repairing, staging, listings, and buyers' visits by going for a 'cash for home' buyer.
Saves Costs Of Repairs
Ideally, when you want to sell your property, you have to incur costs to repair and fix any damages to your property and then list it for sale. But, you can sell your house as-is to the 'cash buyers' without spending extra money on the repairs and fixtures.
No Hidden Fees And Commission
You might not believe that there are no fees and commission in case of cash buyers. But it is true. They follow a straightforward process with no hidden fee and commission. Why? They are already buying your house at a price lower than the market.
Instant Payment Of Cash Without Any Middlemen
By selling your house to the ' cash for homes' buyers, you are bypassing any realtor, estate agent, or middleman. Although you are receiving a lower price than the market, you are entitled to the whole amount of cash paid.
Final Words
By looking at the examples and benefits of selling your house to cash buyers, we can conclude that the concept of cash buyers is not 100% accurate. There are some goods and some bad about selling your house for cash. It depends on your intent. If you have enough time, and budget to spend on repair of your home, listing your house for standard sale process is the ideal choice.