Are you ready to sell your house and interested (or maybe even excited) by the idea of a cash offer? A cash deal is a good way to sell a house, and it might be the best way for you.
In this piece, we’re going to take the mystery out of this process and break it down into steps you can follow.
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Find out today how much your home is worth
Find out how much your house is worth. This is the first and most important step in selling your home. Valuations of houses change over time, so the one you got five years ago might not be accurate anymore. When getting ready to sell to a cash buyer, there are several ways to do this. Let’s talk about them!
Request a CMA From Realtors
A CMA is the first thing you should do to find out how much your house is worth.
A CMA, or Comparable Market Analysis, is a rough estimate of how much your house is worth based on recent sales of similar homes in your area. You can get a good idea of what the market likes in your area by looking at how similar homes to yours have done on the market. These other homes are often called comparables or “comps.”
A CMA generally includes information about the property (like how it was built, how old it is, and what style it is), the neighborhood it is in, and similar homes in the area. The CMA will make changes along the way, but in the end, the report will say how much the house is worth on the market and how much it costs per square foot.
You’re getting the average price of houses like yours in your area. The prices of other nearby homes already take into account the nearby services, which saves you some time.
Since CMAs are not formal evaluations, you can do them yourself, but it is always best to have a professional do it.
Bring in a Valuer
The second way to figure out how much a house is worth is to hire a professional real estate inspector.
Real estate appraisers will look around your house and write reports and take photos to show what they saw. This gives them an idea of how much your house is worth. They don’t just look at your house and how it looks. They will also think about where you live, what’s around you, and other things.
Appraisers look at many of the same factors that you would for a CMA, but they bring a wealth of industry knowledge to the table to get the most accurate value and a formal appraisal to show it.
There are many ways to find area appraisers, such as the Appraisal Institute Registry. From there, make a list of appraisers, and then read reviews of the appraisers to narrow down your choices.
Run Comparable Sales Yourself
But if you’re sure of your math skills and want to figure this out on your own, you can do the math yourself.
You can do this in a few different ways. First, you can look at recent sales in your area and narrow your search by choosing features that are similar to your own home. Think about neighborhood data like school districts, crime rates, and other things that matter.
From there, make a list of properties that are similar to yours and figure out the median price of those homes. From there, you can figure out your price per square foot.
Sites like Ownerly.com, Homelight.com, and Neighborwho.com all offer run comps. Always check your work twice.
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Ask for offers of cash
The next step is to ask for a cash offer on your house. Let’s talk about different ways to do that.
iBuyers, including Opendoor, Offerpad, and Redfin Now
You can look at deals online at places like Opendoor, Offerpad, and Redfin Now to find cash offers. Most iBuyers are tied to well-known real estate websites, but you can sell your house directly to the company instead of putting it on the site.
Since these companies have been in business for years and are well-known in the real estate world, you can trust them to buy your house. Given how big and common they are, it’s safe to say that they have enough money to buy your house without any trouble.
Opendoor does something brave with this way. Since March 2021, Opendoor has been giving sellers cash-backed deals, which has gotten a lot of attention from both buyers and sellers. Once a buyer is pre-qualified for a cash-backed offer, Opendoor will back the buyer’s offer to the seller with cash. This gives both parties the benefits of a cash deal without requiring the buyer to come up with the lump sum right away.
Offerpad Express is a service that is similar to Offerpad but is more direct. With Offerpad Express, your house will never go on the market as long as you have it. Offerpad will buy your house and then handle the sale. This gives you more freedom about when you can move out, and you don’t have to worry about showings.
Redfin The way cash offers work on Now is similar to how they work on Offerpad. Redfin buys your house for cash, and then Redfin handles the rest of the sale.
Companies that buy homes
Most companies that say “We Buy Houses” are real businesses. Many of these companies will buy your house quickly for a lump sum, but you should always do your research to make sure the company you make a deal with is reputable and trustworthy. Even though there are legitimate cash offer businesses, scammers can hide among them. We Buy Houses is a business that people trust.
Ask real estate agents to give you the names of their cash buyers.
If you’re nervous about making cash offers on your own, you can always go to a few real estate offices in your area and ask if they’d be willing to give you a list of their cash-buyer contacts. Since you’ll be getting these contacts from a legitimate business, you’re much more likely to work with a list of safe and reliable buyers.
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Look over the Cash Buyers Offer and Terms
When you get an offer on your home, you should look it over to make sure it’s a good deal. Now things start to get interesting! We will talk about the most important parts of a deal and what makes it stand out.
Good Deal?
You should make sure that the price you offer is fair. Make sure that the deal price is the same as or more than what your house is worth. But a lot of cash buyers agree to deals that are less than what their home is worth. If you’re not in a hurry, you might want to wait for a better deal.
Fast Ending Date?
When you look at a cash deal, think about how long you have to decide. Some buyers who take cash offers are in a hurry to move, so it makes sense for them to take cash offers. Since there are no lenders involved, the exchange process goes much more quickly when cash is used. If you sell to an iBuyer or a company that wants to turn around and sell the property again, the process can go even faster.
Go for it if you’re in a hurry. If you’re not in a hurry and can take your time to find the right offer, you should definitely take your time to make sure you get the best offer and the best schedule for you.
There are no checks?
When an individual wants to buy a home, inspections are usual, just like with any other real estate sale. Buyers want to know what they’re getting into, and an inspection can affect how much they give.
Cash offer sales, on the other hand, work well for owners and house-flippers who don’t mind making repairs or who already plan to fix up the place and sell it again. These buyers might still ask for a check to see what they’re getting themselves into, but they’re less likely to expect you to fix things. Most of the time, these buyers have already built relationships with contractors in the area. They may even work with these contractors regularly for any repairs or upkeep work that needs to be done.
In the end, an inspection might be a good idea to give everyone involved peace of mind, but you don’t have to have one since you don’t have to worry about mortgage rules. Many cash owners know that when they buy a home with cash, they often have to buy it as-is.
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Sign the contract to make it official.
Now that all of that is done, you’re almost done with your sale! If you like the deal you’ve been given and everything is set, sign the contract. Then you can move on to the end!
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Hire a lawyer to handle the closing.
Even though the cash offer process includes fewer outside parties, no lenders, and optional inspections, it’s still important to hire an attorney to oversee the closing process. This not only gives everyone peace of mind, but it also makes sure that your contract is legal and that there are no open ends.
Whether you’re selling for cash or through a bank, selling real estate is a complicated process that requires a lot of insider information that most people don’t have. In some places, like New York, you have to have an attorney write up the contract no matter how you sell your house.
A real estate deal comprises:
- Details about the property and the seller
- The price agreed upon and any other terms
- The date of the closing and any costs
- Paying taxes and fees
- Types of property that can be used for legal reasons
- Any parts of the house that will be included, like furniture and appliances
- Several warnings about things like a well, tree roots, lead paint, and other possible toxins.
- Information about damage done by pests
- Applicable scenarios
- The property’s title and deed
This isn’t a complete list, but it gives you a good idea of how many papers you’ll need, even if you’re selling without a mortgage. It is much better for everyone if you hire an expert. You can look for one online, or your real estate agent may know some people you can talk to.
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Use an escrow service
Even if you are selling for cash, you will still need a trust company to handle the deal.
The money will be kept safe by a trust company while the deal is being made. They will also look over the contract to make sure that everyone is happy, that the contract is followed to the letter, and that the money goes smoothly from buyer to sale.
Having a third party handle the deal makes sure that everything is fair and neutral.
Most of the time, escrow companies also handle the transfer of the title and record the property.
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Put the house up for sale
You have everything you need to close on your house. Once you’ve done this, you can move on and leave your old home in the capable hands of the person who bought it.
One of the best things about a cash offer sale is that the closing takes a lot less time than it would for a regular sale through a lender. Here is a list of the paperwork that needs to be turned in to finish the close.
There are a lot of papers to sign when closing. We’ve already talked about some of the paperwork for the contract, but here’s what you can expect to sign and give during the final closing:
- A list of any closing directions your escrow company needs to know.
- A HUD-1 payment statement that lists all of the costs that are part of the sale.
- A Certificate of Title and title insurance that says you have the right to sell the land in question.
- If you have any open loans that need to be paid off during the closing process, you will need a loan payoff account.
- A mechanics lien, which says that there are no liens on your property for unpaid bills for work done on your house before the sale was finalized.
- A Bill of Sale, which lists any furniture and items that are still in the house after it is sold.
- A list of all fees and closing costs that proves you are aware of everything.
- A piece of information that proves who you are.
In addition to signing a lot of paperwork, you’ll need to provide a few other items and documents, such as a government-issued ID, any keys, garage door openers, or keypad codes, and a way to pay for any costs that aren’t covered by the contract. Most of the time, you will know ahead of time how much it will cost.
