The traditional way to sell a home is to take time to do repairs and renovations, then list the home with a real estate agent and wait for buyers to come to you. This system works well for sellers who have the time, funds and patience to deal with any flaky buyers, inspection issues and problems that can crop up at the closing table. Unfortunately, even then this method does not always prove successful, especially when the seller is short on the time, patience or money needed to make repairs, maintain the home and wait for a buyer to arrive. If you are a seller who feels like the real estate market has left you behind, here are additional possibilities to consider.
Become a Landlord
While this is not an actual way to sell the home, this is the route that many homeowners find themselves taking when their homes do not sell quickly. Unfortunately,becoming a landlord can be an inefficient solution, at best. If the roof, HVAC or some other expensive repair is needed, the landlord is responsible for the cost, as well as the continuing expenses of property taxes, general maintenance and insurance on the home.
To make becoming a landlord a workable solution for dealing with a home that has gone unsold, it is important to find a tenant as quickly as possible. The rental income offers the seller some financial stability and can help pay for the taxes, insurance and mortgage payments. It is also wise to make sure that your home and any rental agreement you sign complies with local ordinances, to avoid fines and penalties.
Selecting responsible tenants who will pay the rent when it is due and keep the property clean and neat can be very difficult. If the rental home is located in a different city or state than where the landlord lives, turning the home into a rental may be unwise. Landlords who attempt to manage their properties from long distance may have more difficulty in watching over their property for condition issues and collecting rent when it is due.
Owner Financed Sale
Another way to get out from under a home that has not, or cannot, be sold in the traditional manner is to consider an owner-financed arrangement. The recent real estate market crash damaged the credit of many homeowners who were forced into foreclosures and short sales. Many of these former homeowners would like to purchase a home again, but may have a foreclosure or short sale on their credit history that makes qualifying for a new mortgage difficult or even impossible.
These former homeowners can be excellent prospects for a successful owner financed arrangement. Before agreeing, the seller should always carefully verify the income and credit history of any potential buyer. In addition, sellers should make sure the contract is carefully crafted to protect their interests, should the buyer default or a problem arise during the life of the agreement.
Sell to an Investor
Selling to an investor, like those that buy ugly houses, is one of the best and fastest ways to sell a home today. In most cases, an investor is prepared to make a cash offer to the seller and can close quickly. Sellers do not have to concern themselves with home inspection issues, repairs or worries that the transaction will fail due to buyer financing problems. Instead, sellers get a fair price for the home in its current state and in most cases, the closing occurs within a few days.
Selling to an investor is an excellent solution for:
​Finding an investor willing to purchase homes quickly can be as difficult as searching through public records for potential buyer prospects or as easy as responding to an ad that proclaims "We buy ugly homes".
No matter which of these three options you decide to use to sell your home, remember to ask questions, verify information and make sure that you understand the agreement before signing any legal documents.
Share21 November 2014
Once I paid of the mortgage on my house, I decided I wanted to buy an investment property. I had no idea that the buying process would be different, but it really was. There were so many things to consider that I hadn't thought about, and even the loan application process was different. It occurred to me that if I didn't know about it, others likely didn't either. I built this site to help others see what I went through buying my first investment home. I hope that it helps you to approach the process with more confidence and understanding.
