Companies That Buy Houses
Type of Home Buyers
There are many different types of buyers and sellers in the real estate market. Many buyers are people starting their careers and looking to procure their first home. Some are young professionals who would like to have more space for their kids, and then there are the retirees who are downsizing.
However, some home buyers aren’t natural persons at all; they are “Companies that Buy Houses.” A home buying company, as its business model, buys houses for some form of profit, and by doing so, they provide a valuable service to the community by buying the homes no one else will.
In this article, you’ll learn more about companies that buy houses for cash, including the pros and cons of working with one.
What Companies that Buy Houses Do?
Companies that buy houses offer an opportunity to homeowners to sell their homes fast and in any condition. These companies purchase the house, renovate them (if necessary), then rent or sell them for a profit.
These companies are quick home buyers who offer distressed home sellers a way to get cash for their home quickly, usually in 10 days or less. This is possible because a “We Buy Homes for Cash” company will have available funds to buy the home outright, thus avoiding the hassle and risk of obtaining a loan.
It is also much easier on the seller since the cash for home buyers will buy homes in any condition, even if the home is in very poor condition. Many will waive most inspection contingencies, making the closing process even more stress-free. It is truly a “Sell House As-Is” transaction.
Companies that Buy Houses for Cash Typically Work With:
- Sellers in bankruptcy or foreclosure
- People who have inherited a home they do not want
- Sellers with a home that needs a lot of work
- Couples who are separating or divorcing
- Individuals who need to sell due to a job opportunity or transfer
- Elderly loved ones who can no longer maintain the property
- People that own homes with unique features or title issues
- Landlords who are struggling with a bad tenant
- People with vacant or unwanted second homes
- People with health issues who need a quick and easy way to sell
All of the sellers have one thing in common, they are looking to “Sell My Home Fast” with the least amount of hassle and for the highest possible cash price! Companies that buy houses for cash fill that need.
A Brief History of Home Cash Buyers
The home cash buying business has been around for hundreds if not thousands of years, but it has really blossomed over the last 30 years.
Home sellers are turning more and more to home cash buyers, many to overcome a problem but a growing number of sellers are not distressed but find the hassle-free sale process offered by companies that buy houses an appealing alternative.
The “we buy homes for cash” businesses have managed to survive many crunches, including the recent 2010 foreclosure crisis. At the height of the problem, the US government watched nervously as thousands of Americans lost their properties. Empty homes blighted neighborhoods across the country, their yards overgrown and their shades are drawn.
This is when many of the home cash buyers stepped in and helped resolve the problem as well as generating much-needed economic activity. By 2017, investors and companies that buy houses for cash had infused over $36 billion into the housing market when they purchased more than 200,000 homes across the US. This helped some of the country’s worst-hit property markets to stabilize.
But the transformation did not end there, these same companies, like OutFactors, established cash for home programs designed around the needs of the average homeowner. Their plan was simple, to make it faster, easier, and hassle-free for a person to sell their home at a very competitive price. The quick home buyer programs now catered to everyone, not just the distressed sellers. Which makes sense, if you are a home seller and can get a fast, free, no-obligation offer in 1 day by answering a few simple questions, why wouldn’t you at least get some cash for house offers? Home sellers understand they have nothing to lose by requesting an offer and potentially a lot to gain. And when they get an offer and crunch the numbers, they are often surprised that they can get the same amount of net cash selling to a home cash buyer.
Types of Companies that Buy Houses
Selling to a home cash buyer is not the same as selling your home through a real estate agent. A quick home buyer can accelerate the sale of your home drastically. Most times, you can have your home sold before you have had the time to interview three real estate agents. Here are the four most common business models of companies that buy houses:
Buy and Hold Home Buyers
Buy and hold companies target properties that are likely to appreciate in value. These are long-term investors that buy homes and rent them while they wait for their value to appreciate. Some of these investors will also offer a sale with a leaseback program that allows the seller to sell the house to the home cash buyer but then remain living in the home under a lease agreement. The sale-leaseback agreement has become a popular way to stop foreclosure and is seen as a good alternative to a reverse mortgage.
Companies that buy houses to flip them are looking for homes that are in poor condition, that are outdated, have foundation problems, or other major issues that need to be resolved. They will then invest the time and money into fixing the home to resell them for a profit.
These “cash for home” companies utilize technology and property market data to make quick home-buying decisions. While a house flipper ordinarily looks for properties that need work, an iBuyer is generally more focused on homes that are in good shape.
An iBuyer makes money on a fee-basis and will often make an offer near the market value of the house. However, it will then charge a transaction fee commonly 8% to 12% of the sales price. The fee charged by the different iBuyers varies but all of them make adjustments based upon the condition and location of the home. If the property needs repairs, most iBuyers will request a credit at closing for the cost of the repairs which is on top of the fees they charge.
Home Trade-in Companies
Some variations exist in the trade-in business models. Some offer to buy new homes on behalf of their clients using the client’s current property as security. Others provide a property-owner an opportunity to rent the new house while waiting for the old one to sell.
Pros of Selling to Companies that Buy Houses
Companies that offer cash for houses present several appealing advantages to people who want to sell their homes. Here are just a few of them:
Simplicity: You don’t have to spend money and time on preparing, staging, and selling the home. There is no need for photographs, virtual tours, open houses, the need to clean the property, and the weeks of back and forth consultations with a realtor.
The process is free of high closing costs, and you won’t need a realtor. Thus, no realtor commissions which can save the seller tens of thousands.
Save Time: Traditional methods of home selling can take months. If the property needs serious renovations, it can take even years to sell. However, a “we buy homes for cash” buyer makes selling easy and very fast. Often, the closing is in 10 days or less.
No Loan Approval: In traditional property sales, the buyers must be approved for loans. If the lender has declined the loan, your dreams of getting the cash you direly need crumple down. This never happens when you are working with a cash for home company, like OutFactors! When you sell to companies that buy houses for cash, you will have closed and received the cash you need before a typical buyer even knows if their loan will be approved – it is that fast.
Sell House As-Is: One of the biggest advantages of selling to companies that buy homes for cash is the sale is on an as-is basis—they will never ask you to make repairs or upgrades. You can “sell house as-is” when you sell your home to a home cash buyer.
The best part, offers are fast & free so you have absolutely nothing to lose and everything to gain by getting an offer, or even several offers!
Cons of Selling to Companies that Buy Houses
While many home cash buyers programs have some great features, there are a few things you need to be aware of. Knowing some of the disadvantages can help you make informed decisions on whether selling to a cash for house buyer is right for you.
Value Proposition: Most companies that buy houses for cash will discount the price they offer to compensate for the money, time, and effort it will take to repair the home and resell it. This makes sense, but the amount of the discount is what matters. To overcome this and ensure you get the highest cash price for your home, we recommend you get offers from several companies that buy houses for cash. Crunch the numbers then, and see if it makes sense to sell house as-is.
Since companies that buy houses for cash offer fast and free no-obligation offers, you have nothing to lose by getting multiple offers except for a little time!
Home-seller Beware: Just like every industry, the cash for home buyer sector is largely dominated by reputable and honest home buying companies, but there are a few rotten apples too. It is not hard to avoid these rotten apples, but you do need to do a little research and ask the right questions. You want to work with a company that has been in business for 10+ years, that is BBB accredited with an A rating, has a prominent online presence, and preferably a local company.
Non-standard Contracts: A few companies, including some prominent national companies, use non-standard purchase contracts or addendums that are filled with legalese that favor the buyer. This potential problem is also easily avoided. You can either hire an attorney to represent you or only sell to a local company that puts everything in writing using easy-to-read standard contract forms, like OutFactors.
Are you looking for a company that buys houses for cash? Our offers are really free and fast. So, why not get one from a legitimate home cash buyer, like OutFactors?
If you are looking for a reputable, BBB accredited company that buys houses for cash with an A+ rating in Dallas Fort Worth area, please call us at 800-420-7030 or visit OutFactors.com for an immediate cash offer.
At OutFactors, our processes are simple, fast, and we put everything in writing using standard contract forms that are designed to be easy to read. Best of all, we are friendly and we’ll take the time to answer any of your questions. Selling to OutFactors is truly quick, stress-free, and we never use high-pressure sales tactics.
539 West Commerce Street
Dallas, Texas 75208
Companies That Buy Houses | Home Cash Buyer | OutFactors – Dallas Fort Worth, Texas