That’s why a cash offer on your home might pique your interest. These deals allow you to skip all the administrative legwork so you can sell your home quickly and start looking for your next property as soon as possible. Before you start Googling, “Should I accept a cash offer for my home?”, read on. Today, we’re sharing a few of the main benefits that this process can provide.
What Is a Cash Home Sale?
Before we dive into the benefits of accepting a cash offer on a house, let’s discuss how it works. What is a cash home sale and how is it different from a traditional real estate transaction? First, it’s important to understand that the team buying your home won’t actually show up on your front doorstep with thousands of dollars in cash. Rather, this simply means that the buyer will pay for the entire cost of the mortgage upfront. They will not need to take out a loan to do so. When this is possible, both parties can avoid a ton of extra steps and fees that are usually associated with a conventional mortgage transaction. Still, the idea of selling a home for cash might seem a little unsettling. If you’ve never been through this process before, it might even seem too good to be true. However, it might be the most advantageous route to take. Let’s take a look at a few of the reasons why it’s smart to give these offers a second look.
1. Skip the Appraisal Process
Home appraisals are designed to give prospective home buyers an estimate of what a home is worth. If the buyer works with a mortgage lender and real estate agent, an official appraisal will be part of the process. Lenders want to make sure that the house a buyer needs them to finance is at least worth the size of the loan. That way, if the buyer is forced to foreclose in the future, they won’t suffer a significant financial penalty. Depending on the results, their lender could decide not to go through with the loan. This can occur if the loan amount is high but the true property value is low. If this happens, it can set back your closing date significantly. When you accept a cash offer on a house, you don’t have to worry about an appraisal. The buyer is essentially purchasing your home at sight value, and there isn’t a mortgage lender involved. This can speed up the process and puts money in your pocket at a faster rate.
2. Close the Sale Faster
In a conventional home sale, the entire closing process can take between 30 and 45 days. That’s a long time to wait when you’re ready to put down roots somewhere else! Most of that time is tied up in negotiations between mortgage lenders. There are forms to complete, contracts to sign, and signatures to verify as part of the mortgage underwriting process. As you might expect, there are many things that could happen during this timeframe. For one, the buyer’s financial status could change. The loan they were once pre-approved for could fall through if they lose their job or suffer a severe monetary setback. If that happens, they might not be able to afford your home anymore. If possible, you need the closing process to go smoothly and quickly. This is why it’s smart to go with a cash offer, especially if you’re in a time crunch.
3. Sell As-Is
Often, buyers will ask sellers to fix major, costly home repairs before they’ll agree to the deal. For instance, they may refuse to close until you replace the roof or install a new septic system. If that’s not possible, they’ll ask for the amount of the repairs to be taken off the home’s final sale price, so they can reserve that cash and address the problems later. In either case, that means you lose money. With a cash offer, you’re usually selling your home in its current condition. The buyer enters into the transaction fully understanding that there might be issues with your home but you aren’t expected to fix them. For that reason, you might not make quite as much money on a cash sale as you would a conventional sale. If your home needs significant upgrades and improvements, then this can be a major money-saver. However, if your home is in great shape and doesn’t need repairs, then a conventional sale might be more in your favor.
4. Skip the Stressful Showings
When your home is on the market, you never know when someone may request a showing. That’s why your house must stay in tip-top shape practically every hour of the day. If you have children or pets, then you know that’s a nearly impossible task. You have a life to live, and you can’t expect your home to look like a showplace around the clock. In one recent survey, 43% of home sellers said one of the most stressful parts about selling their property was keeping it clean. You can skip all of this frustration by going with a cash offer. There’s no fancy open house to schedule or curious neighbors to entertain. That means you can actually live in your home until it’s time to make the deal.
5. Shoulder Fewer Risks
When you put your home up for sale, you’re instantly making yourself vulnerable. Without the proper precautions in place, you could wind up in a messy transaction, or get stuck with a buyer who isn’t as financially stable as you thought. This could put you in a bind, and it could negatively affect your own finances. It can also make the selling process much more time-consuming. If one deal falls through, you’ll have to start all over again with new negotiations. The least risky offer is usually the cash one. You don’t have to worry about any type of third-party financing, which instantly relieves you from a score of liabilities. You can simply accept the payment and move out, no strings attached.
6. Forget the Inspection
Home inspections are just as nerve-wracking as home appraisals. Imagine someone inspecting every corner of your house with a fine-toothed comb, actively seeking out issues with the property that could render your buyer a lower price. It’s enough to make anyone jumpy, but it’s especially unsettling if you know there are existing issues with your house. From aesthetic problems like peeling paint and cracked drywall to larger concerns like water damage in the basement, these are red flags that could put an inspector’s radar on high alert. With a cash home sale, you’re free to skip the inspection. That means no one breathing down your neck and tallying up all of the ways your property failed to meet expectations. It’s a much less invasive and intrusive process, as well as a faster and more effective one.
7. Avoid Messy Setbacks
Often, sellers decide to put their house on the market for clear and easy reasons. They got a job transfer and they need to move to a different city. Their kids have gone off to college and it’s time to downsize. In other cases, it’s a little less straightforward. In fact, it can be downright messy sometimes. For example, this can occur when ex-spouses need to sell their joint property during a divorce, so they can split the equity. Or, you might need to sell your home quickly so you can keep it from falling into foreclosure. You may also be in debt, and the only way out is to sell your house and liquidate the cash. All of these can make the home-selling process much more difficult. However, you can skip straight to the finish line with a cash buyer. Despite your reasons for selling, the steps are easy and streamlined, making even the messiest situation feel simple.
8. Stop Over-Spending on Repairs
Does it seem like every other day, you’re shelling out money to fix something around the house? The roof shingles keep leaking, the patio door won’t shut, and the siding needs pressure washing. Your home should be your oasis and safe haven, not your money pit. If you’re over-spending on repairs that cost more than you can afford to spend, it’s time to let someone else take over. By selling your home to a cash buyer, you can get out while you’re still ahead.
A Cash Offer for My Home? It Could Be a Smart Move
If you’re ready to sell your home, then you likely want to do so as soon as possible. No one wants to spend more time and money than necessary on closing costs, showings, and final transactions. Before you begin searching for “How to find a cash offer for my home?” make sure you have all of your steps in order. Then, you can be ready to act when it starts. Then, enjoy the expedited journey into your new place! Want to take some time to see the world before settling down? Check out our Travel section for tips and destinations!
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