Thinking about selling your home to a real estate investor, but not sure if it’s the right move? Maybe you have seen several “We Buy Houses” signs stuck in the ground next to stop signs, and you are thinking about calling one. Or maybe you have received a postcard in the mail from an investment company looking to pay all cash for your property. Regardless of your level of curiosity, this article will answer questions such as: Will I make more money by selling my home to a real estate investor? How do I know if an “investment company” is legitimate? After reading this article, my hopes are for you to have a better idea whether selling your property to a real estate investor should be the next play for you.
Should you sell your home to a real estate investor?
If ANY if the below statements ring true to you, the answer is yes.
- I’m tired of being a landlord & dealing with tenants.
- I got an insurance check for damages, but would really rather just sell it as-is, instead of fix it up.
- I inherited a home in Georgia and I have no use for it! I want to cash out on it as quickly as I can, because I’m very busy.
- My house needs a decent amount of updating and some repair, and I don’t have the desire or money to do it.
- I’m pressed for TIME and don’t have time for all this real estate agent stuff. I just need it gone!
- I would like to sell my home on TERMS and make money every month. I don’t want the house anymore, but I would like a payment every month!
6 Reasons You SHOULD Sell to an Atlanta Home Investor
# 1: Close & Get Paid MUCH Faster
No need to wait 45-90+ days for bank financing to be approved, inspections to take place, possible repairs to be completed (if buyer requests them), open houses to show the property to potential buyers (also in the meantime keeping the house clean for each of the showings), mortgage underwriting paperwork, etc. An article written by The Lenders Network estimates that when selling a home to someone obtaining a mortgage, “The average time it takes to close on a house (in 2017) is 46 days.” Most investment companies can close in as little as 7-14 days. We are able to close so quickly because our buying process is simple! When paying with cash, there is MUCH less paperwork & restrictions.
PRO TIP: Ask your investor if he/she can “rush the title work” and scrape another 3-5 days off your closing timeline!
#2: You Pay No Commissions
Keep more of that money in your pocket! Real Estate investor’s are not acting as real estate agents. We are the actual buyer! If you hire an agent to list your home, you will end up paying your listing agent a commission, plus the buyer’s agent a commission. Redfin states that “Typically, real estate commission is 5%–6% of the home’s sale price. In most areas the buyer’s agent receives 2.5%–3% in commission and the seller’s agent receives 2.5%-3% in commission.” If you list your home for $200,000 you would end up paying $10,000- $12,000 in commissions to real estate agents. That’s A LOT of money you could be keeping in your pocket!
#3: Flexibility & Problem Solving
Everyone has their own situation regarding when, where, how, and why they want to sell. A real estate agent, or even some large investment companies are very bland, and can only offer 1 or 2 different options to sell your home. However, smaller family owned investment companies are able to take your personal situation into consideration when putting together an offer on your home. Let me tell you a quick story about a sweet lady’s home we just bought in Dallas, Georgia, on the west side of Interstate I-75. Antoinette had her primary residence in Dallas, and was having to drive down I-75 South every morning, during rush hour traffic for work. If any of you have made that trip in the morning before, you only want to do it once. Another issue for Antoinette was where she would move? She didn’t have a place to go! Problem? Not at all. We were able to not only purchase her home in Dallas for cash, but also be super flexible with a closing date, while our company helped her find a new home closer to work. We gave her time to move out, and into her new place, and closed right afterwards.
Click HERE to see what other sellers had to say about Barrington Acquisitions flexibility and ability to help them with their real estate needs.
#4: Sell Your Home Exactly the Way it is
What does all this “As-Is” mean? It means we will buy your house in its current condition. Whether that’s with leaky roof, holes in the sheetrock, an overgrown yard, electrical/plumbing problems, or even a vacant house filled with trash and old furniture. When selling your home “As-Is” you are not financially responsible to:
- make any repairs to the exterior of the home
- make any repairs to the interior of the home
- clean or move anything
- spend ANY money on the home going forward.
Our expertise is renovating homes and working directly with our contractors to bring the most value out of the home. Leave all the hard work to us!
#5: For Once, Get an Offer That Is Not Contingent on Financing!
Zillow wrote an article saying “one of the most common reasons a transaction falls out of escrow is that the buyer’s financing falls through. Typically, if a buyer has been pre-approved, a change in their status, like a difference in employment, new negative credit issue, accrual of additional debts, or a change in lender guidelines can cause the lender to cancel the financing.” When an investor says they will purchase your property with “all cash”, this means there is no bank financing. This means there is no bank to tell you “no.” The investor can do with the cash what he/she pleases, because it’s their cash!
Now this has sometimes been confused with a black duffle bag full of cold, hard, cash. That is not the case here in the USA, but the ‘cash’ is sitting in a bank account, ready to be wired to the closing attorney, with no lengthy approval process.
3 Reasons You Should NOT Sell to an Atlanta Home Investor
#1: No Reviews
If you can not find a lot of reviews on their website, it might be a good idea to stand clear. With so many people jumping into this industry with little to no experience, it’s easy to have a bad experience. I have actually purchased 2 homes in the past month, from sellers that told me they were under contract with another “investor” before me, who backed out of their contract because they couldn’t perform. Don’t let that be you. You’ve been warned.
#2: Your Home is Fixed Up & You are in No Hurry
Investors are looking for homes they can add value to. If your home is already updated cosmetically, is in no need or repair, and your in no rush to sell, then your best option might be to list the property with a real estate agent. There are many more hoops to jump through on this route, but at the end of the day you will make more money if your home is in the condition stated above.
#3: You’ve Got the Time & Resources to be a Contractor
Investors pride themselves in the ability to take a home from “rags to riches” in a rapid manor. This takes experience, and more importantly, a large crew of reliable and trustworthy contractors. Something I wish was easier to come by in this day and age. If you have these people in your network, the wallet to front the bill for materials & labor, and the time, then keep the job in house.
How to Find a Reputable Atlanta Home Investor to Work With
There are many ways to find a generic “investor home buyer.” Maybe they sent you a letter or postcard. Maybe you found them online by searching around. Maybe you received a cold call, and started working with someone already. What you want to focus on, is not getting tied up with someone who doesn’t have the experience needed to get you paid in the time they said they could. Finding people who do what they say they are going to do is hard to come by these days. So here is a checklist of things to keep in mind while on your search.
- Do they have a website? Look for those reviews!
- Do they have a staff or team? This usually means they have some type of experience.
- Who are they? Family owned, individual, or large corporation? All can be good, but who do you like working with more?
- Track Record. How long have they been doing this? Can they give you a story of another client they helped in your same situation?
- How personal are they? Is it always easy to contact someone throughout the process? Are you a person or a number?
- Transparency. Can they explain the whole process to you from A-Z, in the beginning? Were you given any content that educates you on your options?
Selling your home can be a very important and sentimental process for most. Our objective with this article was to show the pros and cons of selling to an investor to help you make the best decision on how and who to sell your home to. If you decide to sell to a real estate investor, be sure to refer back to our recommendations on “How to Find a Reputable Atlanta Home Investor to Work With”. If you are in the metro Atlanta area and are interested in speaking to a well-known real estate investment company, feel free to reach me, Parker Stiles, owner of Barrington Acquisitions, at 678-909-1561. Good Luck!