Is A Real Estate Investor Right for You?

We've all seen the signs at intersections: "Cash Home Buyers," "Joe Buys Houses," or "Avoid Foreclosure," often paired with a phone number or catchy web address. But who are these individuals or companies, and what exactly do they do?

These are real estate investors (also known as wholesalers). They are individuals or companies that contract with homeowners to purchase their property for cash. After securing the contract, the investor then markets the property to potential rehabbers, landlords, or other buyers, and assigns the contract to them, according to Investopedia. Homeowners typically pay no fees or realtor commissions. The process is much quicker than working with a realtor, as there are no showings involved, making it an ideal option for homeowners who need to sell quickly or have properties that require significant repairs or updates they don't want to handle.

How Does This Help Sell Your House?

Real estate investors serve a niche market, connecting directly with those who specialize in rehabbing residential properties. These buyers are often willing to purchase homes with substantial defects or needed repairs. A traditional realtor may not prioritize these homes, and they could sit on the market for months or even years, as they may not be worth the realtor’s time or commission.

Consider a scenario where you've inherited a house several states away, are going through a divorce, no longer want to manage a rental property, or are facing foreclosure. A cash home buyer or real estate investor could be the solution.

Real estate investors are prepared to purchase homes in any condition, which means you won't have to worry about paying for staging, inspections, or realtor commissions. These investors are motivated to get your house sold quickly and have established networks of buyers who are always looking for homes to rehab.

You can perform your own Residential Property Analysis.

 

 

Who Do You Choose?

Opting for a real estate investor can be the ideal choice if your home is older and has issues you’d rather not deal with. This option saves you the hassle of finding and paying contractors for repairs. Typically, they will suggest a closing date within 30 to 60 days.

On the other hand, if you choose a traditional realtor, they may ask you to make repairs or improvements to the house to help it sell faster. If you decide to sell the property "as-is," the realtor may not be as motivated to sell it due to the needed repairs. Additionally, you'll still be responsible for paying a six percent real estate commission.

The Nuts And Bolts Of The Process

Real estate investors work with homeowners in various situations such as divorce, probate, foreclosure, or unwanted landlord properties. You’ll need to sign a contract with them, similar to working with a realtor. Once the contract is in place, the investor will market your house to their network of buyers who are prepared to purchase the property with cash. Using cash eliminates the delays and uncertainties often associated with securing a traditional mortgage.

A Typical Example Of A Home Investor Purchase

Let’s say you’ve inherited a house that hasn’t been updated since 1987. The home is full of floral wallpaper, and you don’t have the time or interest in doing repairs. A real estate investor will visit the property, assess what needs to be done to bring the home up to modern standards, and explain the process. They might tell you that homes in your area are selling for $200,000, but those homes have updated features like solid surface counters, new cabinetry, and other modern upgrades. Based on the amount of work required, the investor may offer you $100,000 for the house, factoring in the necessary repairs and their plan to obtain a quick cash offer with a fast closing. The investor will draft the contract, you’ll sign it, and then they’ll begin marketing the property immediately to their list of buyers. In a short period, you’ll be free from the “time capsule” property and $100,000 richer.

Real estate investors fill an important niche in the housing market. Their role is to help homeowners in distress by providing a quick, no-commission sale without the need for repairs or showings. If you're looking for a fast, hassle-free sale without the stress of repairs, fees, or commissions, contact us today.