The signs are all over the state. “We Buy Ugly Houses.” They are printed in multiple languages. The words appear on billboards and on small bright signs stapled to telephone poles. They are everywhere.
Maybe you have an ugly house, and you are thinking of reaching out to this company. You are not a do-it-yourselfer, and you can’t afford to hire someone to fix the leaky roof and the lousy plumbing in your current home. Perhaps the basement is full of a family member’s stuff, and you don’t have the strength or energy to get rid of the items before you sell.
Before you consider calling the number on the sign, stop and consider your options.
Sure, you could probably receive some money for your house from the “We Buy Houses” company, but what would be the best financial decision you could make for your family?
Are Texas “We Buy Houses for Cash” Companies Legit?
Yes, the company that uses the “We Buy Ugly Houses” signs is a legitimate company called HomeVestors of America. It’s actually based out of Dallas, and they do exactly what the signs say.
More than likely, HomeVestors will give you an offer on your home, regardless of the condition. HomeVestors typically purchases homes at 50-70% of their values. They then quickly fix the problems in the house and put it back on the market to sell it for a profit.
The “We Buy House” people are house flippers, and they want to purchase your home for as cheaply as possible. They will put as little money into it as possible to make the home marketable, and then they will sell it for as much as they can.
HomeVestors is a legitimate business. They do not try to hide what they are doing. But that doesn’t mean you should take them up on their offer. Yes, you are overwhelmed with the amount of work that needs to be done to your house to sell it, but before you make a poor financial decision, you need to stop and consider the consequences.
There are other new business models in the real estate industry of which you should be aware. They are called iBuyers, and they can be found as soon as you fill out a form on the Opendoor, Offerpad, Zillow, or Redfin websites.
These iBuyers will immediately look at the specs of your house as well as other public information that can be found on its worth. Based on this information, they will make you a cash offer for your property, possibly sight unseen. Sometimes the amount the virtual buyer offers will be close to your asking price.
These companies present themselves as a full-service real estate company. They say that they take the hassle out of selling a home by giving you a valid cash offer on your property so you don’t have to worry about constant showings and buyers that may fall through.
How do these companies make money? Although their offers may be higher than the “We Buy Houses” company, they still offer less than what they can resell it for in the open market. While they say they don’t charge commission fees or closing costs, they do charge fees with other names.
Before you agree to an iBuyer offer, make sure you understand the finances of the situation. Chances are, their cash offer is not competitive with the market in the area. If you aren’t careful, the company may also charge you to fix up your own house before they buy it from you.
Maybe you are so desperate to get rid of your home that you will take any offer, even if it is from a nameless iBuyer online. Before you do, please consider the following scenario.
How Much Will a Cash Buyer Pay for Your Texas Home?
According to the U.S. Census Bureau’s American Community Survey, in 2017, the median home value of a home in Texas is $172,200. In most situations, a cash buyer would offer you $137,760 for your home.
While it is tempting to take the $137,760 cash from a company, you need to realize that you could be throwing away the chance to earn $34,440 more on your investment.
What could you do with $34,440? You could probably hire someone to fix a leaky roof or the plumbing of your home, and yes, you would have money left over to buy a new car for your wife.
Texas iBuyer and Cash Buyer Reviews
There are many iBuyer companies out there that will try to give you a fast, cash offer for your home.
Fast Home Offer operates out of Texas and promises to buy houses in any condition and under any price range. One of their potential customers posted a review with the Better Business Bureau website saying the company was “as bad as a craigslist scammer.”
Opendoor is another such company that promises to get an offer on your home “with the press of a button.” But one recent reviewer wrote “they load up on repair costs and hidden fees. On my deal, they added $8,000 one hour before closing.”
Austin All Cash Home Buyers claims to be able to buy your house in Austin and close within seven days, but one reviewer did not appreciate the “lowball offer” made by the company.
“Sell Your House for Cash” vs. a Full-Service, Local Real Estate Agent
There may be reasons why you are willing to make less money on the sale of your house. Perhaps you are willing to take a low price on your home because you need cash quickly.
Maybe you are interested in another property, but the sellers won’t accept a contingency offer. You want to sell your current house quickly to use your equity as a down payment on your dream property.
If this is the case, tell your local realtor your situation. There are ways to sell your house quickly while still making a healthy profit.
Maybe the idea of selling a house is stressful for you, and you would rather lose money rather than get rid of all the junk in your basement or finding someone to replace your roof.
While these reasons may seem valid to you, it is essential you understand precisely how much money you could be losing because you don’t want to be inconvenienced by taking care of a few projects before you sell.
The people behind “We Buy Ugly Houses” and iBuyers are not looking out for your interests. Instead, they should be considered adversaries, not because they want to make money, but because they want to make money at your expense.
Get a Better Deal with a Real Estate Agent
Doesn’t it make sense that you find someone you trust to help you obtain the best price for your home? Before you take a quick, cash offer, wouldn’t it be prudent to talk with a realtor in your area? There are even good, honest realtors out there who will offer a discount on their commission.
While some of these We Buy Ugly Houses or iBuyer companies claim not to charge commission fees to sell your home, there will be fees by other names that will be charged during the closing? Instead, consider reaching out to a local agent who works on a flat-fee commission rate.
Let us help you find a Partner Agent who will work with you to get the best price for your home, no matter its condition. Your agent will help you find someone to fix your roof. He or she will take care of all the necessary paperwork and make the process of selling the house as painless as possible. Your Partner Agent will want to find the perfect buyer for your property. Give them a chance.