Selling House for Cash Offers Homeowners Financial Relief

December 3, 2009

Selling house for cash can provide financial relief to homeowners who need to sell their house quickly. Today, fewer buyers qualify for home mortgage loans and those who do are still skittish about investing in real estate. Between the recessed economy, rising unemployment rates and stringent lending practices, sellers find it challenging to locate qualified buyers.

Selling house for cash is an option offered by many real estate investors and investment groups. Buying houses with cash expedites the closing process, eliminates realtor commissions, and creates a win-win situation for all parties involved.

The primary benefit of cash real estate transactions is closing can occur in a matter of days instead of weeks or months. Sellers do not have to agonize over their buyer being approved for a mortgage loan. Obtaining a home loan today is no easy feat. The days of “no-money-down” subprime home loans are gone.

A second benefit of selling house for cash is there is no need for a realtor. Homeowners can list their property as “For Sale by Owner” then seek out real estate investors to buy their house. Selling a house for cash is no different than selling to a buyer who has obtained conventional financing. Real estate title transfers and legal documents should be prepared and filed by a real estate lawyer.

Recent housing reports show a slight increase in home mortgage loans and new home construction. However, sellers face stiff competition in today’s real estate market. Qualified buyers can choose from a wide range of low-cost foreclosure and bank owned properties. Homeowners who need to sell their home quickly can outwit competitors by actively seeking out real estate investors or buyers capable of purchasing real estate with cash.

There are many types of real estate investors. Some specialize in high-dollar homes, while others focus on buying foreclosure or short sale properties. Short sales are complex and require assistance of a short sale specialist, such as Simon Volkov.

Borrowers who obtain short sale approval are not allowed to profit from the sale of their home. Lenders allow borrowers to sell their property for less than the amount owed on the mortgage loan in exchange for quick sale. Most mortgage lenders require borrowers to have a qualified buyer in place before entering into a short sale agreement.

Real estate experts claim less than 20-percent of short sale requests are approved. Few people can undergo the process without assistance from a real estate specialist. Working with a real estate investor who specializes in short sale transactions can improve the chances of approval ten-fold. Short sale specialists know what it takes to obtain approval and can help borrowers locate investors who buy homes with cash.

Before selling your house to anyone, engage in due diligence to ensure you are working with a reputable business or private investor. Real estate is a hot commodity that invites unscrupulous people to prey on desperate homeowners.

Ask for referrals. Consult with real estate professionals. Conduct research online. Your home is a valuable asset. If you aren’t careful, a scammer could steal your home away from you and leave you responsible for repayment of the loan.

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Buy a House: Is Now the Time?

November 24, 2009

Before deciding to buy a house it is important to explore all available options. Buying real estate in today’s economy offers buyers multiple opportunities to purchase houses at significantly reduced prices. However, precautions should be taken when considering distressed properties such as foreclosures, bank owned and short sale properties.

Most buyers hire a realtor to help them buy a house. Realtors can help buyers narrow down their search by compiling a list of features, location and price range. Realtors can assist buyers with price negotiations, submit offers and counter-offers, and prepare documents for transfer of real estate.

Although realtors can be instrumental in locating the perfect house, there are other options available for buying a home. Today, many sellers are engaging in lease-to-own options which allow buyers to lease the home while contributing a portion of rent monies toward the purchase. This type of real estate transaction is perfect for borrowers who have poor credit or unable to provide a sufficient down payment to obtain a mortgage loan.

Lease-to-own contracts generally last between two and five years. The contract outlines the terms of the sale and includes a predetermined purchase price. Most sellers require buyers to provide a down payment of 3- to 10-percent. Once the contract expires, buyers must obtain a mortgage loan for the remaining balance.

When entering into rent-to-own contracts, buyers should enlist the help of a real estate attorney to ensure documents are legally-binding and protect both parties in the event of default. Buyers should strive to remove negative marks from their credit and pay rent monies on time and in full each month. Doing so establishes a positive record of payment which can assist the buyer when the time arrives to obtain a mortgage loan.

Another option to buy a house is through the use of seller carry back mortgages. Using this type of financing, the seller acts as the mortgage lender. The majority of sellers who engage in seller carry back financing generally finance only a portion of the purchase price. However, some sellers will carry the full amount for a specified period of time.

Seller carry back contracts generally last between three and five years. Sellers typically require a down payment of 5- to 10-percent of the purchase price. If the seller carries back a portion of the sale price, the buyer must obtain traditional financing for the balance. In essence, the buyer has a first and second mortgage.

Seller carry back financing is a good choice for buyers who do not possess sufficient credit rating to obtain funding for the entire purchase price. During the contract period, buyers are given time to establish credit or remove negative marks which could prevent them from obtaining a mortgage loan or refinancing the note once the seller carry back contract expires.

Probate real estate can be an excellent option for first-time home buyers, individuals who want a second home, or real estate investors. Probate real estate refers to property bequeathed to heirs through a decedent’s Last Will and Testament.

The probate process can last for months or even years. During probate the estate is responsible for maintaining the house. If the decedent held a mortgage on the property, the estate must continue making payments and remain current on homeowners’ insurance and property taxes. If the estate does not have sufficient funds, the estate administrator can sell the house to repay the loan or eliminate associated expenses.

Distressed real estate is becoming a popular choice for people who want to buy a house. Distressed properties include foreclosure and bank owned homes, as well as short sale real estate. Bank owned properties are foreclosure houses that did not sell through public auction. These properties can generally be purchased for 10- to 30-percent below market value.

These are a few options to buy a house at reduced prices. Take time to become educated about the various real estate and financing options. Doing so could potentially save you thousands of dollars and provide instant equity in your new home.

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