Hello,
If you’re reading this, it’s a great day! God has blessed you with another day and your able to get some answers to your questions.
I’m sitting in my living room, and I have a house that I own but I don’t want to limit my options on how I can sell it. I asked some very seasoned real estate professionals and find out there are many ways to sell my house. Now my situation really determines what option I would choose but the good news is there are MANY options out there. So, the most common options would be to sell it on the MLS with a realtor or to sell it to someone for a cash offer. Both of these two options, I’m getting the full amount up front that I agree with a buyer on. Of course, Minus Uncle Sam (unavoidable), commissions and title and attorney fees if they exist in the agreement. Some less heard of ways, but also common, are subject to and seller finance. The great thing about real estate is, you can get creative when buying or selling it. Honestly that is the case with buying or selling almost anything in USA because we have freedom and capitalism. Let’s go over all of these options.
LISTING WITH A REALTOR ON MLS
Practically everyone knows this option but let’s talk about it. This option best fits people whose home needs minimal to no repairs, is updated and they want to get top dollar out of their home. It will be presented to anyone looking for a home as it will be posted on MLS. You would look for a Realtor that fits your needs but also would want them to be someone that knows the market your selling in and that will get you the most for your property without overpricing your property. I’m not going to lie to you. There are a lot of bad apples as Real Estate Agents but there are also just as many if not more amazing Real Estate Agents. Ask a lot of questions and make your expectations clear when using a Realtor. If you’re in the Hampton Roads Virginia area or Northeastern North Carolina area I would highly recommend using John Lewis. He has been in that market for 20+ years and I can’t recommend him enough. You can reach him at johnwlewishomes@gmail.com.
SELLING TO A CASH BUYER OFF MARKET
This is what we do!!! It is an amazing option for both parties. You would use this in the following circumstance. Your house needs some repairs, you need to sell it FAST, you want to trade price for speed and convenience, you don’t want to pay closing costs or commissions, you need to stop foreclosure, you inherited a house you want sold without having to do any repairs or showings and many other reasons. This would not be the option you would want to choose if you have a beautiful glistening home and have all the time in the world to sell it. If one of the reasons we mentioned, or other reasons below doesn’t work for you. WE want you to look into a cash offer. Of course, visit us at fairhousepurchase.com and we will help find the right solution for you. That may be one of the other three options discussed in this blog post.
SUBJECT TO THE EXISTING MORTGAGE- AKA SUB TO
In this option you would sell your house subject to (Sub To) your existing mortgage. That means the buyer would take over the payments of your existing mortgage while the mortgage stays in your name. This is legitimized by a real estate attorney, and you shouldn’t trust one that isn’t. Why would you sell Sub To? See below some of the most common reasons.
- Financial problems: You might be having trouble paying your mortgage.
- Get the most money: You might want to get the most money possible from the sale and work out a deal to make that happen.
- Need for cash: You might need money quickly. So, you agree to a lump sum up front and Sub To.
- Foreclosure: You might be facing foreclosure.
- Little equity: You might have little or no equity in their home and selling it would cost you money.
- Improve credit: You might want to improve your credit. By having someone else pay your mortgage you’re improving your credit without paying for it.
- Lower costs: The transaction reduces costs for both the buyer and seller.
- Faster closing: The sale can often close faster than a traditional sale.
SELLER FINANCE
In this option you would agree to be the bank and come to an agreement of terms on how long the loan would be for, what the rate would be, what happens if nonpayment exist and any other terms agreed upon with the buyer. When we say loan, no, the seller isn’t giving the buyer actual money to their bank account. In this case the seller would either have a paid in full house or partially paid. The amount that the seller would be lending, would be the amount the seller wants for his property outside of any existing loans the seller has on the property. This option is great for both buyer and seller in multiple ways. We outlined some of these below.
BOTH PARTIES
- It is quicker and cheaper for both parties because there simply aren’t as many people involved. No bank loan officer, underwriter or legal department to deal with.
- You make up all the “rules” for the financing in agreement with each other.
SELLER
- You get huge savings on capital gains tax
- You make more money in most cases as you’re getting interest on the amount you’re lending.
- It simply is quicker than traditional selling on the market
- You get the house back if the buyer doesn’t uphold their agreement. (Do this by using a Deed in lieu) Which means you can sell it again while you’ve already made money.
- You get to help someone who may not qualify for a loan or doesn’t want to go through the hassle of using a bank.
BUYER
- You don’t have to go through the hassle of using a bank
- If you don’t have great credit but you have money, you can still buy a house
- There are more flexible terms on your mortgage
- Not as much closing money to come up with
In all these options there are Pros and Cons. In the end you must choose what Pros you want and what Cons you can deal with. As in life, make sure you are doing business with people who make sense and know what they are doing. If it doesn’t feel right, then it probably isn’t. Go with another option. Have a blessed day and don’t forget to keep Jesus in your life!
-Fair House Purchase Talk