Selling A Home Fast To An Investor

Selling a home fast to an investor can be a viable option for many home sellers. Investors typically work with a seller who is ready to sell their home right away. For an investor to be able to complete a deal, they need one of two things, a specific price or special terms. Most investors can usually close very fast and with cash.

Who Are Real Estate Investors?

It is important to know that anyone can be a real estate investor. A real estate investor may or not be a real estate agent. Investors who are not real estate agents or any other type of real estate licensed professional act on their own and may not work in the best interest of the seller. The seller needs to be aware of what they are doing and what is happening when working with the investor. A good investor does their best to create a realistic win / win deal with the seller.

When Do Home Sellers Work With Real Estate Investors?

A home seller can work with a real estate investor at any time, just as with a real estate agent. If the home seller is already working with a real estate agent, it may be best to talk with the real estate agent first. If the seller is under contract with the agent, it may be required for the seller to get out of the contract first, depending on the terms. This would allow the seller and agent to discuss and work things out. The real estate agent would appreciate it as well if they have spent a good amount of their time trying to help the home seller sell their home.

Ultimately, investors work with homeowners who are truly motivated to sell their home. The seller typically needs or wants to sell their home fast. Home sellers may need to sell fast when facing a situation such as the following:

What Is A Real Estate Investor Looking For?

Mentioned below are some different types of requirements investors may have to work with a home seller.

The Homeowner To Accept Less Than Market Value For The Home

Depending on the condition of the home, the market, and home value trends, it may need to be a substantially less. If the home seller wants to sell their home right away and the asking price is near market value, they are not truly motivated to sell, and the investor will not be interested.

Reasons Why Investors Offer Below Market Value On Homes

Investors face great risk themselves when purchasing homes. Along with the risks, investors may factor in other concerns when determining your offer price such as:

Short Sale Potential

If the home seller is facing foreclosure, the investor will need to have time before the auction date to attempt a short sale. Many short sales do not happen quickly and it is common for a short sale to take from 3 to 6 months.

Be Willing To Sell Based On Terms

If the investor purchases on terms, they could potentially try and lease purchase the home from the seller. The investor would likely then try and find another buyer for the home or someone who could rent, buy, or lease purchase the home.

Advantages Of Selling A Home Fast With A Real Estate Investor

Can Pay Cash And Close Fast

Investors usually close with cash allowing them to close very fast. There is no waiting for the investor to get approved by a bank for financing. Usually it comes to just agreeing on price, signing documents, and what else is needed for the closing process.

Home Repair and Clean Up Not Required

Investors are looking to buy homes as-is. This eliminates the seller from having to take care of important repairs or trying to make the home look its best to get it sold.

No Special Buyer Circumstances

Most investors close with cash. There is no need to wait or hope the buyers are approved for financing or waiting for the buyers home to sell.

Disadvantages Of Selling A Home Fast With A Real Estate Investor

A Real Estate Agent Is Not Representing The Seller

Unlike when using an agent to sell a home, an investor is not representing the seller. They are simply trying to profit from the home.

May Not Understand Techniques Used By The Investor

Some investors may try and get the sellers home sold using creative real estate techniques. These techniques may be new or confusing to sellers if they are not familiar with what is happening or if the investor does not explain accurately or truthfully what will be done. A high level of some techiques used by investors is described below.

May Be Taken Advantage Of By A Bad Investor

There are good and bad people in all types of business. One should be aware of what is happening to prevent being taken advantage of.

May Not Get Highest Selling Price

Investors need to profit from investing in properties. Therefore, if the investor is buying the home, it will most likely not be for market value or close to it.

Real Estate Investor Techniques And Terminology

At times, investors use creative techniques to profit when buying a home. These techniques have uncommon terminology home sellers may not be familiar with. Mentioned below are some common terms and techniques used by investors.

Wholesaling

When investors wholesale a property, they are not actually buying the property. The investor will first sign an assignable purchase or assignable option to purchase contract with the home seller. The investor will then take the contract to other potential buyers and use techniques to have one of the buyers close on the property.

Subject-To

Subject to investing is when the investor takes over a home and it's mortgage payments, keeping the home owners original mortgage(s) in place. The mortgage stays in the original home owners name. The investor gets the house and pays the payments. Subject-to involves a lot of trust. If the investor stops making the mortgage payments, the original home owner is responsible if the loans are still in their name.

Option To Purchase

If the investor is unsure they will be able to close on the home or find another buyer, they may request an option to purchase contract to be used. The investor will usually pay the home owner a small amount of option money and have a specified amount of time to attempt to close on the house. If the investor does not close on the home in time, the contract is null and void.

Deeds

Deeds are used to transfer ownership of real estate. Investors may have home sellers sign a type of deed such as a quitclaim, warranty, or grant deed. If a seller deeds their property to an investor, they are giving up their rights to their property. Again, when a seller is deeding their property to an investor, they are transferring their ownership of the property to the investor. Sellers should be aware that they are still responsible for debts on the property such as any existing mortgages. Deeding a property does not remove the home seller's responsibility for their mortgages.

Short Sale

When an investor tries to short sale a property, they are attempting to get the banks holding mortgages on the property to accept less for the loan than the total balance due is. A short sale is an elaborate process that takes time. Many short sales take between 3 and 6 months and there is no guarantee of success. If the investor buying the home is dependent on a short sale going through, the home owner should be aware it is going to take time and may not happen. Sellers should be aware of the consequences of a short sale and how it may affect their credit vs. a foreclosure.

Investors can be an excellent option for home sellers looking for other home selling options. Many investors think creatively and can find ways to get a home sold while benefiting the seller in some means as well. Sellers have to keep in mind anyone can be an real estate investor. If the investor is not licensed as a real estate agent or do not have specific laws to abide by, this could bring additional risks to the home seller. Furthermore, if the seller is uncomfortable with the investor or the process, sellers should consider using their own closing attorney to help protect them throughout the selling process.