Think Twice Before Accepting an All-Cash Offer From an Investment Company

Looking to sell your Home? Get a FREE home value report

Looking to buy a Home? Search all homes for sale

Today I want to talk about something that’s coming back into our market, and that’s companies that pay cash for real estate.

I won’t list the names of all the companies out there that are making cash offers on properties, but I will mention some of the techniques and strategies they use that you need to be aware of.

Many times, I’ll be on a listing appointment with a seller and I’ll give them a suggested list price based on what other similar homes are selling for in the neighborhood. That seller will then tell me that an investment company offered them an all-cash offer for the exact same price. Why, then, should they list the home for, say, $300,000 when they already have a $300,000 cash offer?

Here’s why: a lot of these companies will take a commission off of the price they offer. In addition, they’ll charge a convenience fee. They’ll also then do a full-blown home inspection on your property and ask you for a credit in lieu of all repairs for the home.

At the end of the day, sellers who sell to these companies end up getting an average of 10% to 15% less for their homes at closing than what they were promised up front.

The only time it would make sense for a seller to sell to one of these companies is if the home needed a lot of work and they don’t have the funds to fix it up or they need to sell the home now because they’re in a bad financial situation and need cash immediately.

I can understand in that scenario why someone would entertain an offer from an investor or an investment company. In today’s hot seller’s market, though, it doesn’t make sense for a seller to not put their home on the market and get full retail value for it. Why give your hard-earned money to an investment company when you can put it in your own pocket for your financial future?

If you have any questions about selling your home now or selling to an investment company and you want to have a more detailed conversation, don’t hesitate to call me. If you have any other questions or real estate needs, feel free to reach out to me as well. I’d love to speak with you.