If you are asking yourself, “Should I sell my home to an investor” you are in the right place.
Investors often offer you all cash and a short closing time, which can both be very attractive options, especially when your house has been on the market for a while with no bites, or you need to move out of your home quickly.
But is selling your home to an investor really a good idea?
Should I Sell My Home to an Investor?
Here is everything you need to know before you make the choice about who to sell your home to:
What is a Home Investor?
A home investor is someone who is willing to buy your home quickly, cheaply, and for all cash. An investor’s intent is usually to then flip the house for a profit, although sometimes, depending on the location of a home, the intent could simply be to bulldoze the building and redevelop the land.
Investors can be big companies or private individuals. They can sometimes be representatives of big companies who present themselves as private individuals.
Because of this, it is always important to do your research into who exactly you are selling your property to (and what the intentions are!) when you receive an offer from an investor.
Pros of Selling to a Home Investor
There are definitely pros to selling your home to an investor rather than a private buyer. Here are a few of them:
All Cash Offers
Investors typically make offers on the homes they would like to purchase in all cash. This means that when they make an offer, they are able to hand over the entire amount immediately without securing any financing.
“As Is” Sales
An “as is” sale means that the investor will take the home just as it is. This means that you don’t need to worry about the leaky water heater. You don’t need to worry about the mold in the attic. You don’t even need to fix the cracked foundation! If you sell your home to an investor, you can typically forgo the usual process of inspections and repairs that a private buyer would require. Investors will typically be willing to purchase a property sight-unseen, no questions asked.
Super Fast Closings
Because investors don’t need financing to purchase your home and don’t care about completing any inspections on the property, the closing process is usually significantly faster than on a regular sale. When you sell your home to an investor, you can typically expect to close within a week.
Plenty of Ways to Receive the Cash
When you sell your home to an investor, you can receive your payment in many different ways. They can typically send you certified funds, pre-scheduled cash payments, or even just cold, hard cash in person. There is always going to be a solution that works well for you.
Cons of Selling to a Home Investor
Of course, there is always a flip side to these kinds of things.
Here is why selling your home to an investor could be a bad choice for you.
For many investors, their all-cash offers, willingness to buy the house “as is,” and promises of a quick closing cause them to seriously low ball you. You can always expect offers well below fair market value from home investors. This is because if they know you typically want to sell your house quickly.
Even if your home is in perfect condition, don’t expect a competitive offer.
No License To Buy
Investors are typically not real estate agents (although occasionally, some are), so they usually do not need a license to buy or sell homes. This means that you have no idea about the qualifications or background of the person or company selling your home. Because of this, it can be really difficult to judge their motivations.
However, to make things easier, always assume investors are looking to make a profit off of your property.
Could Be a Scam
There is always the possibility that the investor promising you a quick closing and all cash could be a scam artist. Your home, even if it is in bad shape, is still typically the largest asset that you own. You need to be careful with who you sell it to.
If you decide to sell to an investor, ask for a few references and investigate them thoroughly. See if they are registered with the Better Business Bureau. Do they have any complaints filed against them? If you perform a quick Google search, what kinds of things come up?
How To Make the Right Choice for You
Deciding to sell your home to an investor is a highly personal choice. As you can see, the pros and cons of the entire process are deeply intertwined.
Looking to move quickly? Then selling your home to an investor is a perfect option. But what if you are looking to move quickly AND sell your home at its full market value (or at least close to it?) then maybe it is not such a good idea.
When deciding whether or not to sell to an investor, you really need to sit down and crunch the numbers. Is what this person or company offering you worth what you will need to give up for the sale to go through?
Bottom line: if you want to sell quickly, or if there is something majorly wrong with your house, then selling to an investor is likely a very good idea.
If you actually want to receive a fair price for your home and it is in fairly good condition, then don’t sell to an investor. Hold out for a private buyer and sell it the traditional way.
Need a Realtor to walk you through the selling process? No worries! The agents at Clever are always happy to help and answer all of your questions – all for one flat fee. Call us today at 1-833-2-CLEVER or fill out our online form to get started.