You saw an ad saying, “We buy your home for cash.”
And suddenly, a bell rings in your head. Are they superheroes?
Well, maybe they are.
While you are looking to sell your home as quickly as possible, cash buyers do the same. But before going for a cash sale, there are some points you might want to know.
In this article, we are going to dissect the concept of cash buyers in greater detail. Here are the questions you will get answers to by the end of this read.
- Who or what are cash buyers?
- How do cash offers differ from traditional house-buying practices?
- What to expect if you are selling your home for cash?
- How common are cash offers?
Who or what are cash buyers?
Cash buyers are individuals or companies that buy your house outright all at once with the money they have, without the help of a mortgage or loan.
Mainly there are three types of cash home buyers. These are:
- Buy and Hold Investors: They are investors who purchase homes and rent them out to tenants. They have more flexible closing dates and can typically offer you a better price than our next category.
- House Flippers: These types of buyers buy properties that have old construction and poor interiors. They remodel these houses, bring out specific improvements like cosmetic updates, mechanical repairs, etc, and sell them for greater profits. They will typically offer you a low number for your home.
- IBuyers: They are the biggest and newest players in the business of home buying. They use real estate market data and technology to make offers on a potential property. They generally operate primarily in larger metropolitan areas.
How do cash offers differ from traditional house-buying practices?
Selling your home to a cash buyer involves a much smoother process in comparison to traditional house-buying practices, like when a mortgage is involved.
There is less paperwork involved, and you can sell your home faster without making any expensive repairs.
However, as a buyer, you will still need to go through regular property checks, such as hiring a surveyor, etc. The other difference is that cash buyers have to provide a proof of funds letter from their bank showing they have the funds available to go through with the sale.
With very less chances of breaking down, cash offers offer greater surety and create a win-win situation for both the buyer and the seller.
How common are cash offers?
Though traditional buying methods are still in practice, cash offers are very common in today’s fast era. According to the ATTOM Data Solutions study, many US cities account for more than 50% of home sales as all-cash sales. For example, the highest share of all-cash purchases in 2018 was Montgomery, Alabama (54%), Naples, Florida (53%), and Macon, Georgia (51%).
Typically, cash buyers are generally investment companies, iBuyers, or house flippers who want to fix and flip home. They are interested in earning profits from your property and thus, would buy your home without much hassle.
What to expect if you are selling your home for cash?
If you decide to sell your home for cash, expect faster sales, more flexibility, and less stress. Cash buyers will want to know how much you owe on your mortgage. Everything begins with this number. They most likely will not make an offer until after looking over your property. The value they assign to it will closely correspond with the amount of your outstanding loan.
There would be fewer contingencies with cash sales and agent’s commission fees. When selling your home to a traditional buyer, you don’t have much say on the closing date. However, in the case of a cash buyer, you choose the closing date.
Are you also looking for cash buyers who can buy your home for good deals? We at Sole Source can help. We’ll buy your home directly with a competitive offer. Want to know more? Contact us today.
