Should You Sell Your Home To A “We Buy Houses For Cash” Company?
You may have seen the signs in passing while driving in parts of your town where they usually say “We Buy Houses For Cash” or “We Will Buy Your Home In Any Condition”. Sometimes the signs are properly printed signs whereas others are handwritten. Also known as bandit signs since they are illegal to put up in many areas, these signs advertise to homeowners that regardless of the condition of their home they can give it to someone and get paid for it. For some it may make more sense to invest in a few repairs and sell the home as-is on the local Multiple Listing Service or even For Sale By Owner. For others though the we buy homes for cash buyer can represent a quick exit from a home that may not even be livable and is costing more money that it is worth. This article explores the cash for houses concept in more detail.
Just as in the retail market a wholesaler will buy items from the manufacturer and sell them down the line directly to retailers and make a profit along the way some of the we buy homes for cash buyers are wholesalers as well. Those wholesalers don’t intend to buy the home themselves and are merely locking into contract the option to purchase a home with the goal of finding an investor who will actually buy the home for cash at a price over what the wholesaler is in contract with the homeowner for. The wholesaler does intend to make a quick profit by re-assigning the purchase contract to another buyer and hence is the reason for their business model. Some wholesalers do allow subsequent...
4 Reasons Why You May Not Want To Own A House
While many strive towards the goal of owning a home, homeownership for others may be something that can hold them down unnecessarily. Owning a home means committing to a long term mortgage (for many that means 15-30 years) and staying in the same living space for a while. It means being responsible for all the upkeep and ongoing maintenance for the home. This article looks at the reasons why someone may instead prefer to rent an apartment or even a home so as not to be tied down to one place for too long.
High Transaction Costs
In order to purchase a home many need to borrow money via a mortgage loan. Mortgages typically run 15 to 30 years and depending on the interest rate the amount of interest paid over the time of owning the home can sometimes be more than the actual price paid for the home. While a mortgage interest rate deduction can help with that that still means homeowners are paying extra money for the privilege of living in a home they “own”. Additionally prior to buying the home there are transaction costs that come with purchasing the home and taking out a mortgage. Those costs include mortgage loan points, mortgage loan closing costs, real estate commissions, title insurance, title transfer fees, taxes and more. Depending on the price of the home, the total for those upfront costs can be in the thousands of dollars and more. Since home values don’t rise up very quickly (some years home values can go down) it may take a number of years for the home value to rise up enough...
The Essential Skills Needed To Survive Homeownership
Owning a home is quite a bit different than renting a place where if something goes wrong a quick call to the property manager results in maintenance coming by and fixing a problem. Yes as a homeowner you can call a plumber to fix a toilet that won’t flush or can call a handyman (or woman) to come fix a squeaky door but eventually all of those calls will quickly add up in costs. Those dollars spent on calling someone to fix a problem could be put to better use by the homeowner spending on other things they need or by simply adding it to a rainy day fund so when something major does go wrong and a professional contractor can be called in to make repairs. This article explores some of the essential skills homeowners should have in order to make sure their home is running in tip top condition.
Basic Plumbing Skills
Whether you have a slow drain or your toilet clogs up knowing which type of drain cleaner to use or having handy a toilet plunger or toilet auger (sometimes referred to as a drain snake) can save you hundreds if not thousands over the life of owning that home. Routine calls to a plumber will run a minimum of $80 dollars and up depending on your location. Drain cleaning solutions run no more than 10-20 dollars a bottle and often provide multiple uses with one bottle. A toilet plunger should run no more than 5-10 dollars and a toilet auger should cost no more than 20-30 dollars and get multiple if not unlimited uses based on the quality of the product.
With a slow...