One of the hardest situations that a homeowner can find themselves in is not being able to pay for home repairs. When the repairs are unaffordable to fix, the owner may have no other option than to sell their home. Distressed home selling is one of the ways that an owner can sell their home fast without paying for repairs.
What Is Distressed Home Selling?
People choose to sell their distressed homes for a variety of reasons, including:
- Structural issues
- Cosmetic issues
- Maintenance issues
- Fire damage
- Water damage
- Natural disaster
Homes in any one or more of these conditions can be very costly to fix. In some cases, it may be easier to sell the home instead of trying to repair it. That is what makes a distressed home sale so helpful.
Why Sell Quickly?
If a seller doesn't want to take out a loan or want to try and get a grant to repair the house, they should sell it fast instead. Selling a damaged home as quickly as possible will make sure that the condition of the home doesn't get worse.
The better condition a home is in will help its sales price. The sales price of the home will be based, in part, on how much the repairs could cost the new owner.
More damage means more repairs at a higher cost. Houses that are expensive to fix will sell for less than their worth. This is why damaged homes should be sold fast.
Once the decision has been made to sell the distressed home, it is time to look for a buyer.
Types of Distressed Home Buyers
There are three different types of home buyers who look to buy distressed homes. These are investors, house flippers, and cash buyers. Each of these buyers has a different reason they want to purchase a distressed home.
Companies and private individuals can be home investors. They will purchase distressed houses and fix them to make money month after month. Once the home has been repaired the investor can make money by turning it into a rental property.
Not all investors will fix the distressed home and turn it into a rental home. Sometimes they will make repairs to the home and then sell it. This is called house flipping.
Houses can be flipped by investment companies and individuals, too. There is one big difference between a rental home and a home that is going to be flipped. Houses that are going to be flipped are sold for a profit after repairs have been made.
Some buyers look for distressed homes and will offer to purchase the home completely with cash. This eliminates the need for them to work with a finance company to buy the house.
Cash buyers can be investment companies, private home investors, and house-flippers. The benefit to selling to a cash buyer is that the sales process may move faster than when the buyer goes through a finance company to buy the home.
How to Sell a Distressed Home
There are two popular ways to sell a distressed home. One way is to use a realtor and the other way is to sell to a home buying company.
Use a Realtor
The first way to sell a distressed home is to hire a realtor to sell the home. When any home is sold in this manner, the following things happen:
- An inspection is required and repairs are made at the seller's expense
- An appraisal is required which can change the home's value
- Realtor commissions, fees, and closing costs are paid by the seller
- The sale will take a few weeks at minimum
Choose a Home Buying Company
A more popular way to sell a distressed home is to choose a home buying company. The benefits of choosing a home buying company include:
- Appraisals, inspections, and repairs aren't required
- There are generally no realtor commissions, fees, or closing costs
- The sale can be completed in just a few days
How to Sell a House Fast and Cheap, a Recap
Homeowners who have distressed homes but are unable to afford the repairs should not panic. There are affordable ways to sell a house fast. One of the easiest and most cost-effective ways to sell a house when it is too expensive to fix is to sell to a home buying company. To learn more about distressed home selling, contact a company like GTG Buys Homes.