Want to sell your house for cash? Read this first. (2023)

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You've seen ads in your area. They flash on your TV and bring your phone to life at odd hours. Slogans and phone numbers may change, but the theme is the same: "We buy houses for money."

Thousands of real estate investors across the country use a variety of techniques to find potential sellers and plan their next deal.

A recent study by ProPublica investigated how HomeVestors of America, one of the leaders in the home flipping industry,teaches its franchisees to look for people in "ugly situations."(In a statement, the company saidit is not aimed at vulnerable sellersand indicated an internally calculated 96% seller satisfaction rate.)

During our reporting, we interviewed dozens of experts, lawyers, attorneys, sellers and investors to better understand the world of cash purchases. Here's what they say you need to know to get the most money for your home.

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Why are cash home buyers advertising for me?

There are many reasons why a cash home buyer might advertise with you. You might live in a neighborhood with a high percentage of home owners with great equity, meaning you wouldn't be swamped with a mortgage even if the company paid you less than your home is worth. Home prices in the area can rise quickly, creating opportunities for cash buyers to fix them up and turn a profit. Your contact information may have been obtained by a company that sells potential real estate investors.

It is also possible that you are recognized as a so-called motivated seller: someone in a difficult situation who urgently needs money. Our report shows that some real estate investors search public records for signs of financial problems, such as bankruptcies, divorces or death notices. They scour neighborhoods for signs of decay, such as boarded-up windows or water shutoff warnings. And they use personal connections — with other investors, lawyers, nursing home managers and others — to locate distressed properties.

I'm not interested in sales. How do I get them to stop advertising for me?

If you're approached about selling a house and you don't want to, the simplest solution is to simply ignore the request: hang up, recycle the postcard, delete the text. If the requests keep coming, add your number to that of the Federal Trade Commission Don't call the register.

Some cash home buyers will still find you. That's why certain states and cities have added additional protections. In Philadelphia, for example, potential property buyers continue to harass residents after being told to stopmay be fined.In Atlanta, oneprohibition of "commercial harassment"prohibits investors from contacting homeowners for six months after their initial applications are denied.

In areas without those laws, homeowners filed appeals with their state attorney or property commission. If these officers receive repeated complaints about a particular person or company, they can initiate an investigation.

I might be interested in selling. What can I expect when I respond to an ad?

If you do respond, chances are the investor or company behind the ad will respond immediately. They can schedule a tour of your home and ask questions about its condition and your circumstances. I can then present you with a sales contract and encourage you to sign on the spot.

Experts warn homeowners not to commit immediately. Before agreeing to sell, they say, it is important to find out as much as possible about the value of your house.

"Don't sign anything right away," says Michael Froehlich, senior home ownership and consumer rights attorney at Community Legal Services in Philadelphia. "If someone wants you to sign something that day, that's a big red flag."

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How do I calculate how much my home is worth?

Search for your address on Zillow or Redfin, an online real estate marketplace, for an estimate. However, these prices are not always accurate: they may not take into account the condition of the house or recent improvements. Use Zillow or Redfin to see recent sales prices for comparable homes in your area.

If you can afford it, a licensed appraiser can provide a more accurate estimate of your home's value. This usually costs between $300 and $500, depending on the size of your home, and can take several weeks to schedule.

You can also ask a realtor for a free market analysis, said Grant Cody, executive director of the Oklahoma Real Estate Commission, which regulates the industry there: In many cases, they would "bend over and come to your house." — or send you an email immediately, here and there.

What is the difference between a real estate agent and a cash home buyer?

Real estate agentsells your home to buyers and has a fiduciary responsibility to you; they are obliged to try to get the best deal possible. The broker receives a percentage of the selling price of the house. You are also contractually bound to that person for a certain period of time, so if you sell your house yourself during that time, you will still have to pay the real estate agent a percentage.

Cash buyerbuy a house or sell it with profit to another investor. Their presentation is mostly about speed and convenience: they can quickly put money in your pocket, free you from tedious paperwork, and even clean your house. In return, they get a house at a discount. They will most likely fix up the house and sell it for profit or keep it for rent; or they can enter into an "assignment agreement", where the work itself is supplied to the other party for a fee.

What are the risks of a cash buyer instead of a broker?

"Regardless of jurisdiction, real estate licensees have a duty to act in the best interest of their clients," said Nick Rhoad, executive director of the Real Estate License Officers Association. Real estate agents are bound by a code of ethics that requires them to be as clear as possible, avoid misrepresentation and more.

This standard does not apply to cash buyers, who do not always have to have a license. Although the cash-for-purchase industry has a code of ethics, its enforcement is impeccable. Laws relating to unlicensed real estate transactions are generally newer and less developed than those intended for licensed activities.

Our report shows that some real estate investors have been accused of deceptive and exploitative behavior. (When real estate agents are accused of unethical behavior, the licensing board reviews it.) Wholesalers in particular have horrified many sellers: properties they signed for one price ended up being resold, with little or no improvement, for much more.

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What if I need money but don't want to sell my house?

Don't be discouraged. Homeowners facing personal or financial problems have a number of options to explore.

Options vary by state, but here's where experts start:

  • Ask for help from the federal government.FromNational Council of State Housing Agency Homeowner Assistance Fund, overseen by the U.S. Treasury Department, has allocated approximately $10 billion to help homeowners overcome financial difficulties caused by the COVID-19 pandemic. The NCSHA website provides a summary of programs and a map of where the grant fund is open (44 states, at the time of writing). It also has a list of state assets.
  • Find a local advisor.Sponsored by the United States Department of Housing and Urban Developmenthousing advisorsthroughout the country. These agencies provide free foreclosure prevention advice and homelessness counseling. I may charge a small fee for additional services. Visit to find resources near you HUD site. You can also call 888-995-4673,or download the agency's app to find resourcesfor help in different languages.
  • Consult the legal aid office. A good place to start is the Legal Services Corporationaddress book of the local office. Once you reach out to someone, it's important to be patient, said Lisa Sitkin, senior staff attorney at the National Housing Law Project. Legal aid offices are usually busy and the intake process can be slow. Once the lawyer makes contact, they will ask you for information to diagnose the situation. It's important to have "someone who can take a holistic look at your situation and give you realistic advice on what steps to take," Sitkin said.

A cash home buyer gave me a contract of sale. How do I get into it?

What does and does not appear in a sales contract varies greatly depending on state laws and the preferences of the potential buyer. But there are a few key components to understand.

1. Publications:Although laws vary from country to country, many investors agree that it is necessary to disclose that they intend to make a profit by buying your home for less than its fair market value. If the contract states that the buyer is "paying below market for a profit," or if it says that the buyer has the "option to market this property and assign this contract prior to closing," that means there may be a higher bidder. there.

2. Request for "clear title":Any debts you owe, including mortgage payments, outstanding water bills, property tax arrears and more, can be deducted from the final price. So if the offer is $100,000, but you're chasing $25,000 in bills and back taxes, you'll only get $75,000.

A title report costs $50 to $250 and can give you a clearer picture of what hidden debts are deductible in the sale.

3. Termination provisions:In many wholesale contracts, the buyer reserves the sole right to withdraw from the contract. Pay attention to which rights the customer is asking for - and which you are giving up.

4. Other unexpected costs:Even if you've agreed to a price that seems reasonable, it's important to check the contract for any fine print about other costs that could affect your bottom line. Closing costs or transfer tax are sometimes deducted from the sale price you see on the site.

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5. Serious cash deposit:In traditional real estate, a serious down payment shows how serious the buyer is about the purchase. If the buyer cancels, the seller keeps the deposit. The general rule is that the down payment should be 1% of the purchase price. Investors try to invest as little serious money as possible. The contracts reviewed by ProPublica include advances of as little as $100 on a $157,000 job. In such cases, the buyer can provide a guarantee with minimal consequences.

6. Obfuscation of titles:Look for language that allows the buyer to obscure your title and make it difficult to sell the property to another buyer if your deal falls through. Investors will often include a "memorandum of sale" on the property to bind you to a contract.

I signed the contract, but I'm not sure. What are my options?

Our report shows how difficult it can be for sellers to go back on a deal they later decide is unfair. As mentioned earlier, real estate investors sometimes file memorandums of agreement that conceal the homeowner's ownership and pressure them into closing the deal, even if they have found a much higher bidder.

This behavior is predatory, according to four housing experts we spoke with, as well as Charles Tassell, chief operating officer of the National Association of Realtors. But barring evidence of fraud or elder abuse, it's legal. If you suspect that what happened broke the law associated with one of these practices, follow the instructions above to get legal help.

The bottom line, according to Grant Cody of the Oklahoma Real Estate Commission, cash buyers "can't do what's best for the consumer. They can do what's best for them."

Sometimes what's best for them is best for you. But not always.

Molly Simoncontributed to the research.

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Want to sell your house for cash? Read this first.? ›

If you sell your home for $1, the sale is perceived as a gift. This means that the house has not been resold, only gifted. For tax purposes, that means the tax basis stays the same.

What to do first when thinking of selling your home? ›

Close: Make sure you have all your documentation ready.
  1. Set a timeline for selling your home. ...
  2. Hire an agent who knows the market. ...
  3. Determine what to upgrade — and what not to. ...
  4. Set a realistic price. ...
  5. List your house with professional photos. ...
  6. Review and negotiate offers. ...
  7. Weigh closing costs and tax implications.
Apr 26, 2023

What is the most profitable way to sell my house? ›

  1. Understand your local market. ...
  2. Choose the right time to sell. ...
  3. Set the right price. ...
  4. Understand how much it really costs to sell a home. ...
  5. Determine how you're going to sell. ...
  6. Consider minor renovations that add value at minimal cost. ...
  7. Negotiate the best offer not just the highest offer.
Jul 6, 2022

What does it mean when a house sells for $1? ›

If you sell your home for $1, the sale is perceived as a gift. This means that the house has not been resold, only gifted. For tax purposes, that means the tax basis stays the same.

How much less should you offer on a house when paying cash? ›

A good reason why you may want to offer below 5% is when you're paying with cash (although companies who offer sellers cash for their home will typically offer 65% below market price).

What should I pay attention to when selling my house? ›

Don't be afraid to list information about insurance, taxes, utilities or anything else associated with the property. The easier you can make it for the buyer, the more they will like the house. If they have to go looking for this information, they may not be able to find it and move on to another property.

How much should you do to your house before selling? ›

Real estate agents suggest you stay in a house for 5 years to recoup costs and make a profit from selling. Before you put your house on the market, consider how your closing fees, realtor fees, interest payments and moving fees compare to the amount you have in equity.

What is the biggest selling point of a house? ›

Here's a top 10 list of what's most important to potential homebuyers:
  • THE OUTSIDE. It's trite but true: You don't get a second chance to make a first impression. ...
  • LOCATION. Today's homes have to be conveniently located for homebuyers, agents say. ...
  • GARAGE. ...
  • KITCHEN. ...
  • BATHROOM. ...
Mar 4, 2007

How can I make my house more valuable and sell faster? ›

8 ways to increase the value of your home
  1. Clean and declutter. ...
  2. Add usable square footage. ...
  3. Make your home more energy-efficient. ...
  4. Spruce it up with fresh paint. ...
  5. Work on your curb appeal. ...
  6. Upgrade your exterior doors. ...
  7. Give your kitchen an updated look. ...
  8. Stage your home.
Jul 5, 2022

What house sells fastest? ›

The price is right

Lower-priced starter homes are winning most buyers' hearts. Homes listed at between $200,000 and $250,000 were sold in 83 days on average, significantly faster than in any other price range. And of course the more expensive the home, the fewer buyers can afford it.

When your house is worth more than you paid? ›

Equity is the difference between what you owe on your mortgage and what your home is currently worth. If you owe $150,000 on your mortgage loan and your home is worth $200,000, you have $50,000 of equity in your home. Your equity can increase in two ways.

Is the sale price of a house is always equal to its value? ›

Market value and market price can be equal in a balanced market. However, buyers and sellers can view value differently. A seller might feel that their in-ground pool is a benefit, but the buyer could see it as a negative and place less value on the property.

What is the amount that a property actually sells for? ›

Market value refers to the actual value of your property when placed at sale on the open market. It's determined by buyers and defined as the amount they are willing to pay for purchasing the home.

Why would a home seller prefer a cash offer? ›

A cash offer is an all-cash bid, meaning a homebuyer wants to purchase the property without a mortgage loan or other financing. These offers are often more attractive to sellers, as they mean no buyer financing fall-through risk and, usually, a faster closing time.

What is the rule of thumb when making an offer on a home? ›

The rule of thumb is usually between 5 and 10 percent of the home price. Bear in mind that you could lose the money if the deal falls through, so it's important not to put up so much that you'd be ruined if you lost the cash.

Can you counter offer a cash offer on a house? ›

A seller can counter a buyer's initial offer to change the purchase price or increase the earnest money deposit.

What are the three most important things in real estate? ›

The three most important factors when buying a home are location, location, and location. Too often I hear people talking about making decisions based on the home itself, instead of the location, and that is a mistake. What is it about the location that makes it so vital to real estate investing?

How do I get my messy house ready to sell? ›

Get Your House Ready to Sell: Showing Prep
  1. Clear off surfaces. ...
  2. Create a space for everything. ...
  3. Keep all cabinets, drawers, and closets neat and tidy. ...
  4. Keep beds as easy to make as possible. ...
  5. Keep up with the dishes. ...
  6. Keep up with the laundry. ...
  7. Wipe down the counters daily. ...
  8. Sweep and/or vacuum daily.
Oct 24, 2022

How long to live in a house before selling to avoid capital gains? ›

1. Live in the house for at least two years. The two years don't need to be consecutive, but house-flippers should beware. If you sell a house that you didn't live in for at least two years, the gains can be taxable.

Should you stage your home before selling? ›

Home staging has become a "must-do" for many sellers, as 82% of buyer's agents said home staging makes it easier for prospective buyers to visualize the property as a future home. 1 Staged homes have also historically sold faster and for more money than those that are not staged.

What are the 2 most important rooms in a house? ›

The kitchen and the master bathroom. Buyers tend to show more interest in these rooms than any other in a home.

What type of house sells best? ›

Colonial. Colonial-style homes have the highest resale factor when all other elements are equal. These two-story homes that often have a boxlike appearance are popular because of the amount of functional living space that they often have.

What rooms are most important in selling a house? ›

The rooms buyers most closely inspect (and judge) in a house are the kitchen and master bath. These are the interior spaces where the most value can be added during a sale, so they need to look their best.

What decreases home value? ›

Some factors, such as property maintenance and improvements, are in your control. Other times, factors outside your control, such as the property market, natural disasters, and changes in your neighborhood, might be bringing down the value of your home.

What adds the most money to a house? ›

Maximum value will be added by improving the main living spaces, such as the kitchen, dining and living area and the way in which they work together. Before removing walls, work out which are loadbearing by checking the direction of the floor joists as these should always rest on structural walls.

What makes a house more attractive? ›

Opt for neutral colors and decor.

Make your home more welcoming to more potential buyers by repainting the walls with neutral colors, and consider putting some of your favorite art pieces, antiques, or sports memorabilia into storage. Even if you have great taste in design, your prospective buyers might not agree.

What is the slowest month to sell a house? ›

Sellers can net thousands of dollars more if they sell during the peak months of May, June and July versus the two slowest months of the year, October and December, according to a 2022 report by ATTOM Data Solutions.

What day is best to sell a house? ›

Thursday is generally thought to be the best day of the week to list a house for sale. Studies show that homes listed on Thursdays are more likely to sell faster, and for a higher price. Talk to your agent about whether listing your property on a Thursday should be part of your home-sale strategy.

How quickly do most houses sell? ›

After an offer is accepted, home sales typically require an additional 30- to 45- day closing period before they are officially sold. Therefore, the average time it takes to sell a house is 55-70 days in the U.S.

How much equity can I borrow from my home? ›

Typically, lenders allow you to borrow up to 80% of your home equity. So, if your equity is $150,000, you may be able to borrow up to $120,000. If your equity is $200,000, you may be able to borrow up to $160,000. The exact amount you're approved for depends on factors such as your credit score and income.

How can I get equity out of my house without refinancing? ›

Sale-Leaseback Agreement. One of the best ways to get equity out of your home without refinancing is through what is known as a sale-leaseback agreement. In a sale-leaseback transaction, homeowners sell their home to another party in exchange for 100% of the equity they have accrued.

How do you know if a house is overpriced? ›

5 Signs That A House Is Overpriced
  1. It Doesn't Match The Price Of Similar Listings. ...
  2. It's Been On The Market For A Long Time. ...
  3. The List Price Doesn't Align With The State Of The Home. ...
  4. The Price Doesn't Match Your Calculations. ...
  5. The Home Hasn't Received Much Attention.
May 9, 2023

What's the difference between market value and appraised value? ›

The Differences

In summary, market value and appraised value are two different ways to determine the value of a home. Market values are decided by buyers and sellers, and appraised value is calculated by a licensed appraiser.

What determines the value of a home? ›

A home's value is affected by local real estate trends, the housing market, the home's condition, age, location and property size.

How do you determine market value? ›

Market value—also known as market cap—is calculated by multiplying a company's outstanding shares by its current market price. If XYZ Company trades at $25 per share and has 1 million shares outstanding, its market value is $25 million.

What is the amount that a seller takes away from a sale? ›

Net proceeds are the amount the seller takes home after selling an asset, minus all costs and expenses that have been deducted from the gross proceeds. The amount that constitutes the net proceeds could be marginal or substantial, depending on the asset that has been sold.

What is the amount that sellers make on the sale of their home called? ›

A seller's net sheet shows the total amount a seller can expect to receive by selling their home after deducting the seller's closing costs and existing obligations. The final amount after deducting the closing costs and existing obligations is called the Seller's Net Proceeds.

Do you count property in net worth? ›

Your net worth is what you own minus what you owe. It's the total value of all your assets—including your house, cars, investments and cash—minus your liabilities (things like credit card debt, student loans, and what you still owe on your mortgage).

What should you do to your house before listing it? ›

From cleaning and staging to repainting and depersonalizing, here are 11 things you can do to get a house ready to sell.
  1. Research your local housing market. ...
  2. Find a listing agent. ...
  3. Buy more light bulbs. ...
  4. Give your house a deep clean. ...
  5. Declutter the home. ...
  6. Call a handyman. ...
  7. Paint the walls. ...
  8. Stage your home.
Jul 1, 2022

Is it normal to cry when you sell your house? ›

You're not alone if you cried when you sold your home—nearly 40% of Americans felt the same stress. More than a third of Americans admit to crying during the process of selling their home, and not for sentimental reasons, either.

Is it normal to feel sad when selling your house? ›

Selling a home brings about a wave of different emotions. There is excitement in a fresh start, but there may also be sadness in leaving a home you've loved for years. There is anticipation as offers roll in, but there can be stress if the transaction hits a roadblock.

How do you clean a house before listing it for sale? ›

Don't Forget to . . .
  1. Wash the windows, vacuum carpets and drapes and dust thoroughly. ...
  2. If repainting is not in the budget, carefully clean surfaces to remove dust, grime and fingerprints. ...
  3. Keeping on top of the cleaning chores will make your home look its best.

What factors affect the selling price of a home? ›

A home's value is affected by local real estate trends, the housing market, the home's condition, age, location and property size.

How do I declutter before listing my house? ›

To help, here's a list of the most important places and items to declutter as you prepare to sell your home.
  1. Tidy the Front Yard. ...
  2. Create a Welcoming Entryway. ...
  3. Showcase the Kitchen. ...
  4. Highlight the Living/Great Room. ...
  5. Make the Bathrooms Shine. ...
  6. Put Away Photos. ...
  7. Clear the Hallways. ...
  8. Organize Storage Rooms.

What are the worst months to sell a house? ›

Fall and winter are the worst seasons to sell

Just like in the warmer months, the weather plays a factor in the winter months, too. As the days get dark earlier and temperatures drop, people tend to stay close to home. This means less foot traffic for sellers.

Will I regret selling my home? ›

It's not uncommon for sellers to experience regret after selling their home. In fact, a study by the National Association of Realtors found that nearly one-third of sellers regretted their decision to sell.

How do I let go of my house emotionally? ›

Take photos of the property, revisit old memories with them, and reminisce about how you all loved living there. The process will hopefully aid in accepting your emotions throughout the home sale. It's natural to be anxious and stressed about moving.

Why am I so attached to my house? ›

The attachment to the home can be almost as strong as an attachment to a living being. The attachment can be long-term – you've built a relationship with your home as you transformed it from simply a house to your home. It isn't unusual for people to sob as they sign the final documents relinquishing the home.

How do you survive selling a house? ›

Selling a House? 7 Tips for Surviving the Process
  1. Only work an agent you really like and trust. ...
  2. Keep it clean. ...
  3. Have a pre-showing system in place. ...
  4. Set up your home to sell. ...
  5. Request four hours of notice before showings. ...
  6. Don't take negative feedback too personally. ...
  7. Remember that it's worth it.
Apr 13, 2018

How do you get past seller's remorse? ›

Here are ways sellers can overcome Sellers' Remorse and move on after selling their home:
  1. Accept that it's normal to feel sad. ...
  2. Trust your real estate agent. ...
  3. Trust the people in your corner. ...
  4. Allow time to grieve. ...
  5. Plan and celebrate the next chapter.
Jul 25, 2022

Do decluttered homes sell faster? ›

Decluttering lets buyers see your home rather than you

When buyers come into your home, personal items are a distraction. You want buyers to imagine it's their home, without being reminded that someone else lives there. To keep your buyers focused on your home, remove the personal family photos.

Why declutter your home before selling? ›

Decluttering makes it easier to stage your home to sell. Homes that are staged tend to sell faster and for more money than ones that aren't. The additional effort put in to make your home show well usually pays off. Keep in mind that people are likely to look in closets, cabinets, and other hidden areas.

Should I fix things in my house before selling? ›

Keeping a home in good repair can pay significant dividends when it's time to sell. Buyers often look for homes that require few repairs, and no one wants a deal to fall apart because the home inspector found an issue the buyers can't stomach.


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