If you need to sell your home quickly, for whatever reason, there are a number of home-buying agencies that can assist you. However, it is important to be able to distinguish between these reputable companies and scam artists looking to turn a quick buck. Read on to learn what to look for before signing over the deed to your home.
Reputable cash home buyers
Reputable organizations will provide you a fair, albeit discounted, price for your home, and – if you have sufficient equity – be able to provide enough to allow you to pay off your mortgage.
Although you’re unlikely to get market value for your home (after all, the purchaser should receive some discount for enabling a quick closing), you should still expect to net a reasonable amount. Beware of sale offers of less than 50 percent of fair market value – unless you are in dire need, you may be better off by listing your home for sale with a real estate agent.
Signs of a bad deal
Unfortunately, those who need to sell their home quickly can become easy targets for unscrupulous scam artists, who capitalize on the seller’s need to vacate quickly and hope that the seller won’t closely scrutinize any deal offered. Here are some red flags to watch out for:
- Buyer wishes to take over the property “subject to” the mortgage.
- This means that instead of giving you money to pay off your mortgage, the buyer will take over the mortgage payments on your behalf. There are two problems with this:
- First, as long as your name is on the mortgage, you are legally responsible for the payments. You must trust that the purchaser is making timely payments – if they choose to stop paying, your credit could be at risk, and your bank may even come after your assets.
- Secondly, many mortgages have a “due on sale” clause – so that if someone else takes over your mortgage, the entire mortgage balance becomes immediately due.
- This means that instead of giving you money to pay off your mortgage, the buyer will take over the mortgage payments on your behalf. There are two problems with this:
- Buyer offers less than 50 percent of fair market value for the home.
- This usually indicates that the buyer plans to “flip” the house for profit.
- Buyer offers to purchase your home after it has gone through the foreclosure process.
- This can be a red flag because once a foreclosure has been granted and the property is ready to be sold at sheriff’s sale, the ownership of title is unclear. You may not be legally able to sell the home.
Keep your eye out for these things as you work to sell your home. Contact a company like We Buy Houses of Chester County for more advice.