Are you ready to move onto your next home? There are compelling reasons for selling a home as is. Here’s how and why you should consider this route.
Abby’s home had water damage and a lot of it.
The renovations weren’t in her budget. Now, with her new job starting in a month, Abby was pressed for time. How could she sell her home quickly and without paying for any repairs?
If you’re in a situation like Abby’s, this article’s for you. We’ll go over the top things to consider when selling a damaged home, so you can make the best choice for your future.
What do you need to know about selling a home as is? Read on to find out.
1. Pros and Cons of Selling a Home as Is
One of the pros of selling a home is that you’ll save time. You won’t have to wait for contractors to perform repairs, and instead, you can get right down to business.
The key to an as is sale is to price the home properly. The selling price will be considerably lower than a move-in ready home’s selling point.
Since the price is lower, there’s a better chance that the buyers will be willing to pay in cash. You’ll also find that the closing process can move along much more quickly since you’ll be avoiding the intricacies of the mortgage approval process. The mortgage approval process almost always slows down the closing process.
Additionally, you’ll be able to save money by avoiding expensive home renovations. You can even avoid going into debt since you won’t have costly repairs. Remember, letting yourself go into debt because you’re trying to risk your home is never a smart move.
What are the cons of selling a house as-is? Pricing your home as is means that you will get fewer offers. Sometimes repairs scare off buyers who need a mortgage. However, home buying companies and cash buyers won’t be afraid of repairs.
2. Calculate Your Potential Earnings
The next step is to find out if it makes sense to sell as is in your area. Do a little bit of research on what houses are selling for in your area. Ensure that you’re comparing similar properties and in a matching zip code.
Write down about 5 to 10 home prices for houses being sold with the repairs done or move-in ready homes. Then start looking for as is homes selling in your area. Again, write down about 5 to 10 home prices, but this time for the homes selling as is.
Compare the numbers to see what the differences look like. You’ll probably find that move-in-ready homes sell for around 25% more than fixer-uppers. That might seem like a bad deal, but you won’t know until you do the math. Sometimes selling as is makes the most sense financially since you won’t have to invest in home improvements.
If all of this research seems overwhelming, there is another option. You could have a home buying company run the numbers for you, so you can avoid the intense market research. However, you’ll still want to have a good idea of your repair costs.
3. Comparing Repair Costs to Earning Potential
How do you know if selling for cash makes sense financially? Let’s say, for example, that you’re relocating to another state.
The home that you’re selling needs a new roof, new wood floors, and help with the exterior paint. Should you sell this house as is? That’s going to depend on the numbers.
How much is your house worth as is? How much will you be losing compared to selling a move-in-ready home? Once you have a good idea of how much you’ll be losing, it’s time to calculate the repairs your home needs.
Let’s say, for instance, that you need about $30,000 in repairs. If you’re only going to lose $10 – $20,000 on selling your house as is, it will make a lot of sense to skip the repairs.
Think of it like this; if the repairs cost more than you’d make by selling a moving-ready home, don’t make the repairs. Move forward with an as is a sale, so you can leave your old home behind. If you’re still having trouble choosing, check out these decision-making tips.
4. Don’t Negotiate Repair Costs
Repair costs are one of the most confusing elements of an as is sale. If you don’t know what you’re doing, buyers can bully you into taking less money. To avoid making the wrong choice, you’ll have to fully understand what the real estate term “as is” means on a legal level.
What exactly does it mean in the real estate world to sell a house as is? The term as is means that you’re not going to complete any type of repairs before you transfer ownership of the property.
You also aren’t going to be paying for repair costs, even if the buyer requests them. This last point is a pretty big deal. Often, home buyers will try to negotiate with you based on the home repairs that your house presents.
For instance, if your fence is falling apart and it’ll cost $1,000 to fix it, they might ask you to take that amount out of the closing cost. However, since you’re purposefully selling your house as is, you shouldn’t be wasting your time making any type of repairs.
When you list your home as is, you let buyers know that what they see is what they get. You’re offering a fixer-upper opportunity. It’s not your responsibility to improve or repair the house before selling it.
You’ll be pricing the house to match the repairs needed to help move your home quickly. The overall goal is to avoid putting any extra money into a property that you don’t want to own anymore. For buyers, the bonus of buying and as is house is that they can pay a lower price.
5. Reaching Out to a Home Buying Company
Once you’re sure that selling your house is the right choice for your finances, it’s time to call in the professionals. You’ll want to reach out to a local home buying company.
It might be tempting to try to do things yourself, but trust us, you’ll appreciate having experienced professionals in your corner. For one, home buying companies will know how to help you set a realistic price.
Home buying companies can perform comparative market analysis or CMA. The CMA will help determine what similar homes are selling for in your area.
Knowing the latest market trends, you can set the perfect price for your as is home. By pricing your house correctly, it’ll be easy to move it fast rather than letting it sit on the market for a long time.
Home buying companies can also help you find the best potential buyers. No more wasting your time on tire kickers.
Thanks to their access to multiple listing services, they can look up legitimate buyers who actually want to purchase homes. Using the multiple listing service or MLS, your home buying company can look for legit buyers. They’ll be able to locate the type of buyers who are already interested in getting a home.
6. Show Off Your Home’s Good Side Legally
You have to put your home’s best foot forward. Let buyers know what shines about your property, not just what needs repair.
You should highlight your home’s layout, location, and any other features that will help you get the best deals. However, you also have to make disclosures.
What are short sale disclosures? When selling a home as is, there are certain things you legally have to disclose. Different states will have different mandatory disclosures. If you fail to disclose all the information accurately, you could wind up with a legal problem.
Don’t worry, though. When you have a home buying company, you won’t have to worry about knowing all the legal rules. The home buying company will hope you navigate the legalities of selling your home.
As long as you’re not actively trying to hide something about your home, you shouldn’t have any issues. For instance, many states are going to require you to provide the buyer with a disclosure report.
The report will show all of the problems your house has at the time of the sale. The report can be a valuable tool since it’ll prevent the buyer from backing out of the deal later.
In your disclosure report, a few things you might have include; water damage, electrical problems, foundational damage, mold, and fungus. Be specific about the type of mold your home has too. The more honest you are the better the sale will be.
If you live in a state with a caveat emptor rule, you’ll have more leniency. The caveat emptor rule states that it’s up to the buyer to uncover all of the house’s defects. Double-check with your real estate agent or home buying company to determine what you’re legally required to disclose.
7. Getting Fair Quotes
As you start looking for home buying companies to work with, they’ll be asking for information about your house. Having the information prepared ahead of time can help make the quoting process more accessible and straightforward.
For one, you’ll need your full property address and a good contact phone number and email. You’ll also want to have a list handy of the repairs you know your home already needs.
Many real estate companies will have online forms that you can fill out, or you can choose to call the company directly. After getting a little bit of initial information about your house, the home buying company will need to set up a viewing appointment.
During the viewing appointment, they’ll be able to come and see your house in person. Viewing appointments are usually fast and can be conducted within less than 30 minutes.
After the initial viewing appointment, you’ll be able to receive a no-obligation offer. No obligation means you don’t have to accept the offer. The offer should also be honest and thorough.
You’ll want to look for home buying companies that use a reputable title company. Reputable title companies will make it easy for you to get your money quickly and without any hassles. In some situations, you can get the money from selling your home as is in as short as 10 days!
8. Selling for Cash and the MLS
When you move forward with a professional home buying company, will your house still be listed on the market? It’s going to depend on how they operate.
Often the best home buying companies will buy your house from you directly. The idea here is that they can make the repairs and resell the house to other buyers. Sometimes, home buying companies will repair the home and rent it out.
It’s usually a better deal if you allow the home buying company to purchase your home directly rather than listing it on MLS. However, if you’re curious about what your home with self around the market, you should let your agent know. They can help you explore all of the possibilities.
For instance, a home buying agent can help you go over the numbers to decide what path will suit your needs. One of the ways they determine the pricing for your house is by considering the location, repairs, and current condition of the overall property.
Finally, look for a company that is going to give you a fair offer, free of fees. There shouldn’t be any fees or commissions when you sell your house as is; it’s just that simple.
Sell Your Home for Cash Today
There you have it! The best tips for selling a home as is. Whether it’s your current residence or inherited property, there is help. Instead of being trapped in a house you don’t want or going into debt for renovations, you’ll be able to move forward with your life.
Here at Home Buyers Acadiana, we love answering questions to help you reach your goals. We’re happy to buy houses in any condition and never charge you a commission or fee.
There’s also no obligation, so what are you waiting for? Reach out to us today for your free cash offer.