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A cash offer and quick sale of your home can be tempting but it is always a good idea to weigh your options. The United States is in the middle of a housing crisis where supply is falling far behind demand. Inevitably, scarcity has driven up housing prices. In this market, your home may be far more valuable than you think. Instead of selling it outright, you may want to consider keeping the home and renting it out, which will provide you with an additional revenue stream. Becoming a landlord may be a better and more lucrative option than simply selling your home.

Sell Your Home for Cash

The main advantage of selling your home for cash is the quick turnaround time. You won’t have to worry about making repairs or staging the home for open houses. Basically, you get to skip most of the hassles that can go with listing and selling your home.

If you have seen signs and advertisements in your neighborhood that are offering to buy ugly houses for cash, most of these offers are legitimate. The real estate market is competitive and a variety of investors are willing to pay cash for homes that they then renovate and sell or use for rental income. But why would you sell your home to an investor when you can become a real estate investor yourself and earn passive income?

Is Selling Your House for Cash a Good Idea?

The good news is that if you decide to rent out your property, you don’t necessarily have to take on all the landlord responsibilities yourself. Perhaps you aren’t that handy and you don’t want to have to deal with repairs or you will be moving out of state and won’t be able to effectively manage the property. Fortunately, property management companies can take on as many or as few of the management tasks for a small fee. The key is to partner with the right company that has your best interest in mind and can help protect your investment. Here are a few things you should consider as you investigate companies.

  • Read the reviews. Google reviews are a good place to start, but since selling your home is such a big financial move, be sure to dig deeper. Look at online directories and other professional industry websites. Finally, don’t hesitate to reach out to reviewers and learn more details about their experience.
  • Visit their website. As a consumer, you have visited plenty of company websites and you can recognize a professional site. Stay away from any companies with a poorly executed site. Also, make sure that they are upfront about exactly what you can expect to receive when you sign up for their services.
  • Contact other landlords and ask for recommendations. People in your area will be more than happy to share their experiences and talk up their favorite property management businesses.
  • Trust your gut. Do the people from the company seem trustworthy and genuine? If you are feeling pressured in any way or you ever feel uncomfortable dealing with someone from the company, don’t be afraid to trust your instincts and move on to finding another company.
  • Be on the lookout for any irregularities. As you get to the point where you are ready to sign contracts, make sure that the paperwork accurately reflects what you have discussed and what they have promised.

Finding the right property management company will make the entire landlord experience as smooth and seamless as possible so that you can continue to get the full value of your home.

Who Buys Homes for Cash?

There are several different types of companies that buy homes for cash:

  • Franchises. There are national brands that have franchises in different cities. This means that you will be working with someone who has local knowledge and is backed by a larger company.
  • House flippers. Home improvement TV shows have popularized house flipping. Typically, these buyers are looking for homes in a distressed condition. They will renovate the property so that it is move-in ready and hopefully make a profit once the home is sold.
  • iBuyers. These buyers represent online companies like Zillow, Opendoor, and Redfin. Essentially, they are interested in buying homes that need very little work. Their goal is to quickly sell the home again at a profit.
  • Buy and Hold Investors. Sometimes investors are looking to earn rental income and will offer cash so that they can then find tenants.
  • Trade-in Companies. If you need cash quickly to put towards your new home, you can work with a trade-in company. They will pay cash for your home and then sell your property and pocket a percentage of the sale.

Keep in mind that these different types of investors are all looking to make a profit off your home, however, there is no reason what you can’t enjoy those same profits yourself by turning the home into a rental property.

Sell Your House for Cash

Before you make the decision to sell your home for cash, it is important that you understand the actual value of your home. Today’s real estate market is extremely competitive, which means that your home may be worth more than you think. There is a housing shortage across the country so as a homeowner, you have an in-demand commodity.

In general, cash buyers want to be able to get a lower price on your home in exchange for a more hassle-free selling process. If you are in a hurry to sell, this can be a welcome relief. However, many homes today are selling for well over the asking price, which means that you could be leaving a lot of money on the table if you decide to sell for cash.

Selling a House to a Cash Buyer

When you deal with financing during a real estate transaction, you can expect closing to take anywhere from 30 to 60 days. With an all cash purchase, closing can take as little as two weeks. There are the steps you can expect to go through with a cash sale:

  1. Accept the buyer’s offer and sign a Purchase and Sale Agreement.
  2. Request proof of funds so that you know the buyer actually has the cash. You will probably also request earnest money.
  3. Work with a title and escrow company that will make sure property lines are accurately drawn and that there aren’t any outstanding liens on the home. The title company will also issue title insurance and make sure that everything is properly finalized on closing day.
  4. The buyer will pay for a home inspection. If the inspection reveals major problems that weren’t evident before, they may change their offer accordingly.
  5. Sign the closing documents. Even with a cash deal, there will be plenty of paperwork to sign. Your title company should help make sure everything is in order. Just be prepared to keep signing your name.

Cash for Houses

There are legitimate companies that are looking to buy houses for cash. This arrangement can have advantages for sellers, but it is also important to consider the value of your home, especially in today’s real estate climate. Housing shortages mean that you might be better off keeping your home, especially if you decide to turn it into an investment property and rent it to tenants. With the help of professional property management companies, becoming a landlord isn’t as difficult or time-consuming as you might assume. To learn more about what property management companies have to offer and what your property may be worth, contact Deca Property Management today.