Should You Work With a "Sell House Fast" Company? The Pros and Cons

 

If you need to sell a house quickly, you may be tempted by signs and online ads promising "Sell Your House Fast!" But are these sell house fast companies right for you? Here's an in-depth look at the pros and cons of using a sell house fast company versus listing your home traditionally or selling it yourself.

What Sell House Fast Companies Do

Sell house fast companies aim to streamline the selling process to help homeowners liquidate properties quickly. They make cash offers, close fast, and market directly to motivated sellers. Some key services sell house fast companies provide are:

• Buying homes directly with cash offers versus traditional listings
• Optional selling without repairs or staging
• Providing certainty with no financing contingencies
• Fast closings, often within 7-28 days
• Eliminating the need to show the home to buyers
• Acquiring unwanted inherited or distressed properties

The companies earn profit by buying homes below market value, making light updates or repairs, and then reselling or renting the homes. Their target customers are often sellers who inherited a property, are relocating quickly, or can't afford expensive repairs.

The Potential Benefits of Using a Sell House Fast Company

Speed and Convenience

The top advantage of these companies is the ability to close quickly and conveniently. There's no need to prep your home for showings or wait for buyer financing. This appeals to sellers who value speed and simplicity.

Avoid Repairs and Staging

You can sell as-is, so there’s no need to invest in improvements or staging. The companies buy homes in any condition.

Certainty of Sale

Once you accept their offer, there’s a guarantee your home will sell. There are no appraisals or financing that could derail the sale.

Cash at Closing

You’ll get your proceeds at closing, either in a lump sum or structured over time. There’s no waiting for buyer financing to go through.

Leaseback Options

Some companies let you lease back the home for a short period after closing. This creates flexibility if you need time to relocate.

No Agent Commissions

You avoid paying a real estate agent's commission, which saves significant costs. Commission rates are typically 5-6% of the sale price.

Potential Downsides of Sell House Fast Companies

Lower Price Than Market Value

The biggest tradeoff is these companies will pay below full market value for your home. For sellers focused on maximizing profit, listing on the open market or selling privately may yield a higher sales price.

Fees May Offset Savings

While you avoid agent commissions, the companies charge their own fees. These typically range from 3-6% of the purchase price. So the commission savings may be negated.

Quick Timeline Presents Challenges

For an inherited or vacant home, a fast timeline may be ideal. But it can present hurdles if you’re still living in the home and need longer to relocate.

Limited Negotiation

These companies make their best cash offer upfront. Unlike buyers making traditional offers, they won’t engage in back and forth negotiation and bidding.

No Exposure to Open Market

Because the companies buy directly from you, your home is never exposed to potential buyers in the local housing market who may pay more.

Risk of Working With Unvetted Companies

New or shady sell house fast firms may make unfairly low offers, have hidden fees, or not follow ethical business practices. Extensive vetting is essential.

Tips for Getting the Best Offer from a Sell House Fast Company

If you decide to work with one of these companies, here are tips for getting the best price:

• Get offers from multiple established companies to compare.
• Make sure the buyers are transparent about all fees upfront.
• Negotiate to reduce any excessive fees to boost your net proceeds.
• Ask what recent homes have sold for in your neighborhood to gauge fair value.
• Highlight any upgrades you’ve made that may increase the home’s worth.
• Get a contractor’s estimate for any repairs needed and provide quotes to the buyer.
• Consider making minor DIY repairs that may drastically boost offers if the home is dated or damaged.
• Time your sale strategically. Offers tend to be higher in peak home buying seasons.

Questions to Ask Sell House Fast Companies

Here are some key questions to ask prospective sell house fast firms:

• How long have you been in business buying homes in my area?
• What types of properties are you looking for right now?
• What are your average timelines from offer to closing?
• What repair costs will you deduct from offers on homes needing work?
• What are your total fees for purchasing my home?
• Do you allow any leaseback period after closing for the seller?
• Can you provide references from sellers you’ve worked with previously?
• Will you outline your full offer and terms in writing before I accept?

Weighing Your Options

Ultimately, you need to weigh the pros and cons and decide if using a sell house fast company aligns with your goals. If you highly value speed, certainty and convenience, they may be a good solution. But if maximizing your sale price is the priority, listing your home traditionally or trying to sell it yourself might get you more money. Doing thorough research and getting professional advice from cash home buyers can help you make the right decision. With the right approach, you can sell your house quickly and successfully.