3 Ways To Sell Your House Fast
If you need to sell your house fast, for whatever reason, there are a few ways to do it. It all depends on your situation, how much equity you need to get out of your house, and how flexible you are with the terms of the sale.
Here are the top 3 ways to sell your house fast, in any market:
1. Sell your house for cash to an investor. This is by far the fastest way to sell. You’ve probably seen the signs on telephone polls with “We buy houses cash” type wording. Or maybe you’ve even received some kind of mailer or postcard asking you if you want to sell for cash quickly.
The Pro’s to selling to an investor are you get cold, hard cash usually in under 30 days regardless of what condition your property is in. This is usually a good deal if your house needs lots of work and you don’t have the money or time to fix the property yourself. This is also a good idea if you need cash in your hand immediately to pay for some kind of emergency like a death in the family, medical bills, or even the taxman breathing down your neck.
The Con’s of selling to an investor are you need equity… lots of it. Most investors will only offer 50-65% of the market value minus repairs. So if your house would be worth $150,000 all fixed up and the house needed about $30,000 for repairs, the most you could expect from all cash investor would be around $60-70,000. Now, obviously, you would need to have a mortgage balance less than that amount otherwise you would have to cover the rest yourself at closing.
2. The next strategy for selling your house quick is listing it with a Realtor or an agent, however, you would price it a good 10% below what the other listings similar to your house were going for. This allows buyers to immediately consider your property first, since it is priced the lowest when their agent pulls up listings for the area.
The Pro’s of selling this way is that you can usually get a buyer pretty quickly since, as mentioned, your house and listing would show up as the lowest price pick out of a bunch of homes for sale. Also, the prospective buyer would have an easier time getting their loan to close since the appraisal will generally show it being worth more and the lender would be much more comfortable making a loan on a under valued property.
The Con’s of selling at a lower price through an agent is, well, you’re getting much less than your property is worth. And you also have to consider the cost of selling. If you include the buyer’s agent and seller’s agent’s commission, closing costs, and other fees, that can set you back at least a further 12%. Meaning, you would typically net about 78% (10% from the listing discount minus 12% for the cost of selling) of the fair market value of your house. This is definitely a fast way to sell, again, if you have the equity to cover the discount, otherwise you would need to bring additional money to the closing table to get the house sold.
3. The third way is a bit more creative. It involves selling your house through a lease option (or rent to own). This is where you sell your house with a lease covering a set time period (anywhere from 6 months to 10 years, depending on your situation) and then set an option with a set price you will get when the tenant/buyer purchases your house and cashes you out.
The Pro’s of selling with a lease option are you get immediate mortgage relief allowing you to move or at least not have a vacant property to worry about. And since your selling the house privately, you keep the entire purchase price when the tenant/buyer gets their mortgage approved. You don’t have to pay the usual fees and commissions, and you also don’t have to take a discount like in the other methods.
The Con’s of selling this way is that you have to wait to get cashed out. The tenant/buyer will be making payments to you monthly while working with their mortgage broker to get their loan approved. They will be taking care of all the day-to-day maintenance as well as the repairs so it wont be like renting it out traditionally. There is also the risk of the tenant/buyer not being able to get approved for a mortgage within the term of the lease. Then you would likely have to extend the lease or find another buyer. Since the market for tenant/buyers is far greater than conventional cash buyers or those with huge down payments to get approved in this market, you can usually get the property sold again in a matter of weeks.
Selling with a lease option isn’t the best option, but it can be a great alternative if you can wait a bit and want to get full price for your house. Or maybe you don’t have equity or happen to be upside on your mortgage. This way you can sell for the full balance of the loan and not have to worry about ruining your credit with a short sale or a modification program. Again, it all depends on your unique situation and how flexible you can be.