Selling your house can be a daunting and time-consuming process — especially if you’re looking for a quick and low-hassle experience. A death in the family, divorce, or mounting debt often adds extra strain. Whether you’re facing financial difficulties or ready to downsize, it’s possible to sell your house for cash and avoid the traditional real estate market. However, selling a house for cash also usually means leaving some extra money on the table. Here, we’ll take a closer look at the benefits of selling a house for cash and how it compares to a conventional listing process. When you sell a house for cash, it simply means that you sell to a buyer who can purchase the home outright without the use of a mortgage loan. If you agree to an offer of $350,000, your cash buyer will need to show proof that they have that $350,000 at the ready in a bank account or something equivalent. This calls for working with a niche type of buyer that typically purchases off-market homes — houses that may need repairs or can otherwise be purchased at a discount. Cash investors typically pay anywhere from 50% to 70% of market value. Now that you know what it means to get cash for your home, is selling your house for cash a good idea? “The value a cash buyer offers is convenience and speed,” says Will Holly, owner of Holly Nance Group, a boutique real estate investment firm in New Jersey. “You’ll avoid the time hurdle involved with back-and-forth negotiations with multiple buyers.” Let’s review some of these benefits more in depth. When you sell a house for cash, you can get money for your home much faster (usually in a week or two compared to several months with a non-cash buyer). Mortgages are time-consuming. As of 2023, mortgages are taking an average of 40-50 days to complete from start to close. The lender will also require an appraisal to confirm the amount of funds they’re willing to provide, which can introduce additional delays. All in all, with a cash offer from a house-buying company, you can often close the sale in as few as seven to 10 days. For sellers who need cash quickly, this is a huge advantage. When you sell your home for cash to a house-buying company, you can skip the repairs and other preparations typically required when selling on the open market. Cash-for-homes companies often purchase homes “as is” since they have the capital and expertise to update a house. This removes the repair burden from the seller’s shoulders. A cash sale also means you won’t need to stage your home or worry about keeping it spotless for weeks or disrupting your schedule for repeated showings. Besides repair and staging costs, a cash offer can cut out additional closing costs. Many house-buying companies will cover closing costs in full for the seller, which can amount to 9% to 10% of the sale price. (The largest cost is typically the agent commission at an average 5% to 6% of the sale.) These savings can act as a counterbalance to a lower offer price. A HomeLight study found that the average cost to sell a house to a traditional buyer is $31,308, so when weighing whether to sell for cash, you should always factor in the selling costs associated with each option. So long as you own a house, you’re responsible for its holding costs (also known as carrying costs), which include utilities, taxes, insurance, maintenance, and other fees amounting to a decent chunk of change each month. In a sluggish real estate market, Holly says it could take as long as six months to sell a house. This can cause delays upward of half a year to get the equity out of a home while the owner continues to cover the costs of heating, cooling, mowing the lawn, etc. A cash offer provides more immediate relief from these ongoing costs. Plus, the longer your home sits on the market, the greater the likelihood of reducing the list price. Holly also points out the peace of mind and financial certainty that comes with a cash sale, especially for homeowners juggling life challenges. “Many home sellers with complexity to the sale are better off with a cash buyer,” he says. Those complexities might include a death in the family, bills stacking up, or expensive repairs. A cash offer may come in lower, but it won’t hinge on your home appraising at a certain amount or the financing working out for your buyer. When you need cash now, a drawn-out sale can be a major stressor. As home shoppers face today’s higher interest rates, a buyer with cash in hand eliminates the uncertainty of getting a loan approved. Mortgage interest rates have more than doubled since last year, making it challenging for some prospective buyers to qualify for a home loan. “A cash buyer is not susceptible to rate hikes,” says Holly. An increase in interest rates or a change in the buyer’s credit history or employment situation could cancel or delay a settlement just days before closing. “Contracts are falling out more often,” Holly adds about the current real estate market. Without the added risk of a financing contingency, selling to a cash buyer is typically a simple, more certain process. Whether you want to move next week or stay put for a couple of months, a cash sale generally gives you plenty of wiggle room. Sellers who work with a house-buying company often select a move-out date that works best for them. Working with a cash homebuyer differs from the traditional agent-assisted process in many ways. Below we offer a side-by-side comparison followed by an infographic showing the steps to complete a cash sale. One of the most convenient ways to find a reputable cash homebuyer anywhere in the U.S. is through a HomeLight’s Simple Sale platform. Simple Sale provides you with a no-obligation all-cash offer sourced from the largest network of cash buyers in the country. Our partner investors have a wide range of investment strategies, including fix-and-flip and buy-and-hold. To get started, tell us a few details about your home and when you need to sell. After collecting some information, we’ll provide you with a no-obligation, full cash offer in as little as a week, and you can close in as few as 10 days. Header Image Source: (Will Porada/ Unsplash)What does it mean to sell a house for cash?
Reasons to sell a property for cash
1. Faster closing
2. No repairs or home staging
3. Reduced closing fees
4. Smaller holding costs
5. Peace of mind
6. Interest rate immunity
7. Flexibility
What’s the process to sell a house for cash?
Cash home sale vs. traditional home sale
Aspect of the sale
Selling to a cash buyer
Listing with a real estate agent
Timeline
In as little as 7 days, or up to 30 days if the seller needs more time.
77 days (34 to get an offer, and another 43 days to close, on average).
Home prep and repairs
None. You skip the preparations, repairs, and staging.
Make necessary repairs, deep clean, declutter, landscape, and stage the home.
Showings
No typical showings, though a cash buyer will collect information about the home and may request photos or video.
You’ll make your home available for 10 to 25 showings, on average.
Inspections
Many cash buyers will perform an inspection or onsite evaluation — it depends on whom you work with and how they operate. Even if you’re selling “as is,” a home inspection could still be required.
May need to make repairs for the buyer or renegotiate the price.
Appraisal
House-buying companies and investors may or may not perform a traditional appraisal. This can depend on the onsite visit and the company’s evaluation process.
An independent appraisal will be required to close when your buyer is using a mortgage, this can take 8-10 days and may require negotiations.
Title search
The cash buyer will require a title search to make sure that you can convey the property free and clear of any claims or judgments against the home.
Title issues must be resolved to close the sale. The property must be clear of claims such as mechanic’s liens, unpaid taxes, or boundary encroachments.
Financing contingency
None are present in a cash sale.
Mortgaged buyers often use a financing contingency that could hold up the deal if the loan doesn’t clear.
Closing costs
Many cash-for-homes companies will pay the closing costs.
About 1% to 3% of the sale price (on top of commission) including title insurance, escrow fees, and taxes.
Getting paid
When you sell a house, how do you get the money? It may only take a matter of weeks or even days for the cash buyer to wire funds over to your bank account.
The time it takes for you to receive funds will depend on the buyer’s due diligence period and other steps you must clear before settlement, as required by the buyer’s lender. As noted above, on average, it takes 49 days to close a traditional home sale.
How to find reputable cash buyers
