Are you considering selling your home to one of those home buying companies? Then you’re probably wondering “are home buying companies legitimate?” We’ve put together what you need to know about these companies and selling your home.
If you’re in the market to sell your home, you may be considering how many different options you have. After all, real estate can be a tricky business and even with a clever real estate agent, finding prospective buyers and being able to sell your home for what it’s worth can be difficult.
Depending on the competition, the location and a whole host of other factors, selling houses can take a tremendous amount of time and effort.
You may think dealing with a reputable real estate agent is the only solution, but there many options such as local real estate investors and other cash buyer companies that have options available to sell your home. Many of them even pay cash for houses.
Now there’s a good chance that you’ve seen ads or flyers for local home buying companies and wondered the same thing as many others, “are home buying companies legitimate”? It’s easy to be skeptical about these companies when they say things like “cash for houses” or “we buy ugly homes”.
So, to make the decision easier on you, we’ve put together some things to know about home buying companies, what to expect and how to go about selling your home this way if you choose to do so.
What Are Your Goals
The first thing to know is that regardless of which type of home buying company you choose (there are several that we’ll get into later) how the process goes and what you make on your home will be different.
Selling Your Home Quickly
Many of the companies that buy houses either have their own capital or private lenders to buy homes for different purposes. This means that the process for selling your home is quick and direct because you don’t have to deal with any banks or loans.
If your primary goal is to sell your home quickly, then you might find this to be a more viable option than trying to find a realtor and wait for your home to sit on the market. In most cases, a sale to one of these companies takes a fraction of the time of a traditional home sale. This makes it the right option for those looking to move quickly for a job opportunity or who simply want out of their house while being concerned about overall profits.
For example, if a motivated seller worked with Keystone Home buyers, they could have their house sold and paid for in as little as seven days.
Selling Inherited or Unwanted Property
Many home buying companies report that a large portion of their sales comes from property that individuals inherit or can no longer afford to manage. This can be people who acquire extra property when they already own a home, people looking to downsize from their existing home or anyone wanting to get out from under additional expenses and obligations.
In these cases, people trying to get out from under excess property are not interested in a traditional sale because of the time involved. Even with a good real estate agent it can take a long time to sell a home on the open market, time which many home sellers simply don’t have. If profit isn’t an issue, then many folks will opt to avoid the real estate market.
Selling Distressed Properties
If your home is in rough shape and needs a lot of repairs, it can be incredibly difficult to find a licensed real estate agent to sell your home in that condition. That’s when looking into local real estate investors like Keystone Home Buyers might be especially beneficial. KHB buys homes in need of repair; offering to buy your house fast and as is for a cash sale (much easier than trying to go through the normal home selling process).
Often the driving force behind trying to sell distressed properties is the repair cost. While it is generally believed that companies that buy houses try to pay only bargain prices, most of the time the price offered is based on a number of factors including the repair costs, fair market value, and what will be done with the property. While most companies will offer a lower price for homes in poor condition, it is often a worthwhile option for homeowners that don’t have the capital to repair the home to get the home’s fair market value.
Types of Home Buyers
There are a few different types of companies that are interested in purchasing homes for a variety of reasons. However, most buyers fall into one of three categories that we’ll detail below.
House Flippers
We’ve all probably seen the ugly house commercials and flyers on telephone poles, and many cash buyer companies operate under this model and pay cash for homes that they intend to spend a bit of money to renovate and then sell. House flipping companies are legitimate businesses and many flippers prefer to buy independently owned houses for cash offers rather than dealing with bank financing and high service fees.
An investor like Keystone Home Buyers will try to offer as close to fair market value for the home factoring in costs to repair and profit for reselling. The seller then benefits from not having to deal with traditional financing rules, real estate commissions, and other fees. They can sell fast and have the entire process complete quickly. Most companies will discuss exactly what the house is worth including considerations like repair costs, age of the home and time on the market. How much money is offered will depend on these factors and the intent of the buyer.
If you’re interested in this type of sale, Keystone Home Buyers is a great choice!
Rental Property Investors
Another type of company that buys houses is one that buys the property to turn it into a rental investment. These are typically individuals who are looking to acquire homes that are in good shape and won’t require a lot of work.
For these reasons, investors typically don’t buy homes in poor condition because the initial investment will require more money than the potential rental income over a set term. Just like flippers though, they will typically make cash offers for a bit less money than the house may be worth with the benefit to sell fast.
Keystone Home Buyers is a great candidate as they do their best to make their offers as fair to the seller as possible.
Real Estate Investors
The third type of company that buys houses is the local real estate investor. Most often real estate investors are looking to buy houses that are in key areas or that will appreciate in value. Often they are looking to hold onto the property for the purposes of development or waiting on the price to go up. This means they may offer more money than other companies, but this depends on market factors.
If you’re familiar with the real estate industry in your area, the local market, and know that your home will gain value, then selling to an investor might be a viable option. Depending on the local market your home may even sell for fair market value or better as investors are willing to pay more money to develop in certain areas.
Final Thoughts
As you can see, companies that buy houses are a legitimate option for selling your home, but the trick is figuring out if it is a fit for you. Keystone Home Buyers is an excellent option if you need to sell fast, if you’re having difficulty selling, the property needs major repairs, or if you prefer the simplicity of selling for cash.