In any situation where you have to act swiftly and sell your house, selling for cash is one of the preferred options available. For instance, you could be moving to a new state because of a new job or simply relocating away from where you currently live. Besides, people sell houses for different reasons; you could even be a real estate investor looking to close on a couple of deals. While accepting cash offers on such properties may be the best thing, abuse is inevitable if the purpose of cash offers is not known. Cash home buyers in Los Angeles are always looking to make a deal; hence you need to know how to sell your house.
Unfortunately, many homeowners understand the difference between traditional sales and cash offers but know so little about selling for cash. Since you would typically employ the services of a realtor, you might not understand that selling a home can be demanding. But it does not have to be an arduous task.
One way to declutter all the processes involved is to create a checklist, as we have done here. This will help you create a plan to land the right buyer and earn the desired profit from every sale. From the onset to the closing day, you can be in charge of the sale of your home. How? Read on to find out how this checklist can be helpful and the processes involved in selling your property for cash.
Reconsider Your Decision To Sell The House
- Be futuristic in your thinking: what are your goals for the next few years?
- Consider the benefits and disadvantages of selling your house.
- Can you afford a new home? Even after selling the existing one.
- Estimate your home equity.
- Evaluate the local housing market and confirm if selling is profitable now.
- Consider rehabbing the house to suit your needs, but you should not waste time making a decision here since you will be selling as-is.
- While a cash offer is available, you might want to evaluate the advantages and disadvantages of using your house as a rental property.
Estimate The Cost Of Selling Your House
- Whether you choose to make the repairs or sell as-is, you should list all the repairs needed to get the house in perfect condition.
- Calculate the cost of hiring contractors and buying supplies.
- Only choose projects you can afford; you do not want to run into debts because you want to sell your house.
- Consider projects that directly increase the value of your home: remodeling and green upgrades.
- This will help you cut the cost down to an acceptable price, place you in the position to drive the price of the house down appropriately at the negotiating table.
- Prepare ahead for closing costs.
Prepare A Selling strategy
- How soon do you want to sell the house?
- How much money do you expect to gain from the sale of your home?
- Decide how you want to sell the house yourself? In this case, you are selling for cash.
- Consider the benefits and disadvantages of selling the home for cash.
- Attend real estate auctions & networking events, be a part of real estate investment clubs for a quick sale, especially in a slow market.
- Promote the unique features of your home on property signs.
Processes Involved In Selling Your Property For Cash
With a checklist in place and you ready to make a move, learn about the processes involved in selling your property for cash. Although Cash home buyers in Los Angeles will ensure you undergo no stress at all in the process of completing the deal. Cash offers will not just give you quick returns at the end of the day; it does so with ease. Here are some of the processes you should know:
1. Sign the contract
Before a cash offer is considered accepted, a Purchase and Sale Agreement contract must be signed. Usually referred to as “going under contract.”
2. Verify proof of funds
Remember, this is a cash offer. You must ensure the buyer has the money available to close the deal. You can often do this by asking for some percentage upfront (1-2 percent of the sales price). Not just that, because 1-2 percent is barely a chunk of the actual cost, request for proof of funds. Bank/investment statements are enough to get the deal going.
3. Hire title and escrow companies
Some cash home buyers in Los Angeles will ask you to choose the companies. All the same, these companies must be available for the successful completion of the deal. Depending on the state, the choice can either be yours or the buyers.
A title company makes sure the property liens are accurate and that no other property liens need to be further addressed. Importantly, issuing title insurance and confirming the changes to property ownership. The escrow company is in charge of all closing documents, ensuring the transfer of funds between both parties, finalizing the agreement, and confirming the sale.
On the other hand, a property lien is a legal notice used concerning unpaid debts. Taxes, child support, or outstanding services from a contractor are examples of debts that can warrant a lien be placed on your home until such debts are settled. In summary, you cannot sell your property even for cash until all liens are resolved. Furthermore, the title company ensures you do not have any lien before closing.
Although cash home buyers in Los Angeles can take on the responsibility of title and escrow companies, be rest assured that they have your best interest at heart.
4. Pass the home inspection
This is a very crucial step in getting your house sold since you might be selling your house as-is. Most times, you will receive cash offers that come with inspection contingencies. This addition allows buyers to pay to have your house inspected and request repair or drive the house price down depending on how critical maintenance is.
In reiteration, this is one procedure you must learn to maximize. Keep your house in stellar conditions or ensure you know how much possible repairs will cost. Thus, you can factor it into the initial price of the house. As soon as you pass the home inspection, you are ready for closing.
5. Review and sign closing documents
Yay! It’s time for closing. You are either appending your signatures on the closing documents with a big smile or leaving somewhat dissatisfied. This guide is to ensure you are the former. So, get your signing hand ready for some action — it’s time to closing the deal. However, you have several documents to sign as a guarantee, even though you are dealing in. Here are some forms you can expect to sign:
- Final closing instructions: Closing instructions can be delayed till closing or signed when your escrow account is first opened. Whenever you sign it, remember, it contains information about the responsibility of your escrow company and how they will accomplish them. Importantly, double-check all figures for possible errors or misappropriation.
- HUD-1 settlement statement: This document contains every amount involved in the deal and is required by federal law. The HUD-1 includes everything you have negotiated until closing: sales price, pay-off balances, prorated tax and utility bills, etc. This document needs to be appropriately kept as you will need it for your taxes. Check for possible errors, but Cash home buyers in Los Angeles are known for proper documentation.
- Certificate of title: Basically, a document that shows you have the right to sell the concerned property.
- Title deed: This transfers ownership of the house to the buyer. Although this will be signed at closing, the deal is not fully completed until it’s documented at the county courthouse.
- Loan payoff statement: You might not need this document If you have no mortgage on the property you’re selling. Otherwise, it is a document that reveals how much you are owing, and it must be the same as the amount your escrow company will be paying on your behalf.
- Mechanics liens: A document that shows you have no additional liens on your property from contractors or laborers.
- Bill of sale: Useful, especially if you are selling as-is and leaving items behind. This document records every furniture or item negotiated into the deal.
- Statement of closing costs: Appending your signature on this document means you are fully aware of possible closing costs and fees before closing. Read more about Spintires For PC
- Statement of information: In summary, you are under oath that you are who you say you are.
What You Need To Close A Deal
With proper knowledge of the possible documents you will be signing, come with the following to your signing appointment:
- Government-issued ID.
- The deed of payment, if your house is paid off.
- The keys to your soon-to-be-sold property, garage door remotes, and passwords to keyless entry and alarm systems.
- Often you will be notified if you need to pay extra fees. But a certified or cashier’s check to cover any outstanding costs is not outrageous when coming to the signing appointment.
The best way to sell your house is not one that stresses you out but ensures you are satisfied at closing the deal. You can sell for cash in cases where you need to act quickly; John Medina Buys Houses for cash and handles every paperwork, allowing you to make a profit on a property without a bit of stress.