If you want to sell your house, should you list it with an agent, or should you sell directly to a real estate investor? The best answer is . . . it depends. Everyone’s situation is unique, and that’s what determines the best option. So let’s look at some of the pros and cons of listing vs. a direct sale to a real estate investor in Madison.
Listing vs. a Direct Sale to a Real Estate Investor in Madison
Listing With an Agent
The most popular way to sell a house is through the traditional route that involves working with a real estate agent. Agents are educated in the process, know the market, and have access to the MLS. They can target a huge market of potential buyers, will handle the marketing, and can help you get the best price.
The primary cons of using an agent are that you will lose money in paying the agent’s commission and that the process can take a long time. Because most agents confine their marketing efforts to traditional marketing, selling your house could take anywhere from six months to a year. You will also have to endure multiple showings, and there’s always the chance that a sale will fall through because a buyer can’t get financing.
In addition to having to pay an agent’s commission out of the sale price, sellers often wind up having to pay part or all of the closing costs to close a deal. The upshot is that the sale price isn’t really the amount of money you will ultimately receive.
Carrying Costs
One thing to keep firmly in mind about listing vs. direct sale to a real estate investor in Madison is the carrying costs when listing with an agent. These are the costs associated with owning and maintaining a house while you’re trying to sell it – for example HOA dues, mortgage payments, property taxes, utilities, insurance, and so on.
So although you may get a higher sale price by going through an agent, the whole process can take so long (up to a year in some cases) that your profit may be eaten up by these carrying costs. And although selling to an investor may mean a lower sale price, because it is much faster, you may ultimately walk away with more money in your pocket.
There are both pros and cons concerning listing vs. direct sale to a real estate investor in Madison, and the best option depends on your unique situation and needs. If, however, you’re new to selling real estate, it may be difficult to make that determination.
A Direct Sale To A Real Estate Investor
For many people considering listing vs. direct sale to a real estate investor in Madison, the latter is often the better option. The chief benefits of selling directly to a real estate investor are the usual cash payment and the quick closing, often as little as just one week. Also, most investors will pay 100% of closing costs, and you won’t have to pay any commissions to agents.
In deciding between listing vs. direct sale to a real estate investor in Madison, keep in mind that investors are buying houses in order to make a profit, either by flipping or renovating and renting. This means you are essentially paying for a service. You get to avoid the hassles that you would normally need to go through in selling a home and the investor can make a profit as well. We call this a win-win.
In general, going the traditional route to sell your house – that is, using a real estate agent, going through multiple showings, and waiting for a buyer to secure financing – will often get you a higher sale price. But it takes much longer, and you lose a good chunk of money to fees and commissions. In certain situations, then, the benefits of selling directly to an investor in Madison far outweigh the cons.
Cash Payment
Real estate investment companies and many individual investors have the wherewithal to pay cash when they buy a house. So if you sell to an investor, you’ll often receive a full cash payment on the closing date when the dotted lines are signed.
Although a cash payment from an investor may be a little less than what you would receive through the traditional process, it is much faster. You also won’t have the worry of a deal falling through when a buyer can’t secure financing.
“As-Is” Purchase
One of the most attractive of the benefits of selling directly to an investor in Madison is that these deals are often “as-is.” An investor is often willing to buy your house in any condition, and you won’t have to sink a bunch of money in repairs and renovations before you can sell it. Further, you won’t have to endure – or pay for – any inspections. Not only does this speed up the whole process, but it can save you some significant expenses as well.
No Commissions
When you sell directly to an investor, you won’t be using an agent, and so you won’t have to pay the agent’s commission. The amount you are offered for your house is the actual amount you receive at closing. If you need cash fast and need to know exactly how much you’ll receive from the sale of your house, this can be a huge plus.
Fast Closing
As indicated above, another of the benefits of selling directly to an investor in Madison is a fast closing. If you sell to an investment company that specializes in cash house purchases, closing can happen in as little as seven days from the time of offer. The sale doesn’t depend on the buyer getting financing or appraised value or inspections. Basically, you bypass all these things that slow down the sale process, and so it is greatly expedited.
Foreclosure Avoidance
For some people, this can be one of the huge benefits of selling directly to an investor in Madison. If for whatever reason – divorce, injury, layoff, medical bills – you’ve been unable to keep up with mortgage payments, the bank may be threatening to repossess your house. So if foreclosure is on the horizon, selling directly to an investor may be a way out for you.
You can avoid ruining your credit and possibly even putting your family on the street. Of course, this may not be the ideal solution, but it can get you out of a seemingly hopeless situation and let you keep your dignity intact. And if you really don’t want to move out of your home, you may not have to. Some investment companies will assume the mortgage and allow you to remain in the house and rent it from them.
Obviously, the benefits of selling directly to an investor in Madison are numerous and valuable. The problem is, though, many inexperienced sellers just don’t know how to go about selling to an investor. That’s where we can help.