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Sell Your House For Cash Warning – Tip 25


Sell Your House For Cash Warning – Tip 25
If it’s your plan to sell your house for cash and you’re in financial difficulties please read on. Our warning applies to everyone who requires an immediate sale. There are many different types of firms out there offering cash for your house. However, not all will be able to supply immediate cash.

If your requirement for a cash sale has been brought about by difficult circumstances you will need to find a firm which has funds at its disposal. You see, due to the credit cruch there are many “agents” operating as cash buyers who may operate by trying to find you a buyer. Some will have access to genuine cash buyers, but most won’t. This means they will be dependent on mortgage finance and subject to the whim of the mortgage approval process.

Example. If your plan to sell your house for cash has been brought about because you have mortgage arrears then the stakes are pretty high. Mortgage repossession figures may be down, but the fact is that thousands of people still lose their home because they didn’t or were unable to find an alternative solution.

In the current climate your lender may give you time to find a buyer. But from their point of view the minute you confirm to them you have a cash buyer their expectation will go through the room. If you have to let them know your sale has fallen through or can’t be completed for a given deadline you could really be in trouble.

Therefore: if your circumstances require a cast iron commitment to sell for cash in days, ask prospective buyers to evidence their credentials. In other words ask for proof of their purchasing power. If your back is against the wall (and they will know this..) it’s your best insurance against the firm telling you later on they can’t find a buyer or have no cash.

If you really must sell your house please heed this warning.

Luckily there are still a number of genuine cash home buyers out there who will happily help you sell your house for cash.

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Pricing your house to sell at auction is a black art!

Thankfully the auction house will help you. But before speaking to an auctioneer its as well to understand something about pricing property for sale at auction.

Not one, but two prices are central to the way property auctions work. The Guide Price and the Reserve Price.

It’s also important to understand the relationship between the two prices.

All property sold at auction has a reserve price. This is your bottom line price – the minimum you’ll sell at. The reserve is worked out in advance and is not made public.

The price that is made public and is declared in the auction catalogue is the Guide Price.

The guide price is the figure the auctioneer expects the property to sell for. Guide Prices are however generally on the low side, and properties routinely sell for much more.

For most auctions the guide price is higher than the reserve price. Where this is not the case it is potentially misleading. Always ask individual auctioneers how they handle the relationship between the two.

A low guide price can help attract interest. How low you’re prepared to set the reserve depends on a range of factors including how much you need to clear from the sale. Setting a relatively high reserve say at 75& of a property’s market value, may lead to a property being unsold.

Pricing your house to sell at an auction for cash means (most likely) it will sell for less than you’d get through estate agents, but it should sell. However using auctions to ‘test the water’ can be expensive, as you have to pay fees even if your property is unsold.

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Selling A House For Cash Tip – Negotiations

Views on how best to negotiate on selling a house for cash differ widely.

Some are of the opinion that if the chips are down revealing your position will weaken your negotiating position.

Well yes and no.

If you are pressed for a quick cash property sale, not revealing the extent of your difficulties may cause the sale to unravel. You have mortgage arrears, but you “forget” the true extent. You don’t reveal you are bankrupt or in a Trust Deed.

You must relocate by a certain date..the list goes on.

As property buyers ourselves (albeit largely resting ones!), we have been on the receiving end of half truths. In the end it can completely scupper your sale.

To counter the notion that you need to be economical with the truth, you can imrpove your position by discussing your situation with more than company.

A sympathetic property buying company, and there are some, really need to have the full picture to be able to help you sell your house for cash.

Definite no nos are:

Not doing your sums correctly on how much has to be paid off;
Not discussing how to sell with other family members;
Dismissing unsecured debt as unimportant;
Failing to flag up your “must haves”;
Failing to get everything in writing..;
Only contacting one firm or contacting more than 4.

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Sell Your House For Cash Tip 9


If you have no choice but to sell your house for cash to an estate agent property buyer then it’s important you know who will be buying your property.

You see, property buying companies or cash buying specialists may be less in control of your sale than you imagine.

There are at least two reasons for this.

Property Buying Companies Can Sell Your Information On

Some buying companies are not buying the property directly. They basically act as “finders” for other people or act as clearing houses for leads sourced on the internet.

In the case of lead generators you fill out a form and it ends up in an online shop. Someone buys the information on your form. Your personal details are not revealed until the “lead” has been bought.

You literally have no idea who’ll be approaching you and nor does the lead shop owner because they have done no vetting!

That said, some sold experienced buyers do use these services.

Property Finders

The second possible outcome is that the company you have contacted does not buy in your area or prefers t find a buyer for your sale. Kind of like acting like a property equivalent of a dating agency.

Our point is that both these can work for vendors, but you really need to know the who and what of any person or firm contacting you after you have been online to find property buying companies.

When Sell Your House For Cash Means a Mortgage

The other dilemma is that your “cash sale” may be dependent on a mortgage. You may not have been expecting that and it is a long story.

Suffice to say you really need to find out where the money is coming from.

So for your own peace of mind:

Find out who the buyer is and their relationship to the people you contacted
Find out where the money is coming from
Find out if you can use your own solicitor for the sale.

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Getting A Cash House Sale Tip 3

Getting a cash house sale usually means making a compromise or two. Typically this refers to the price you can expect from an auction, property investor or cash property buyer.

How low will you go?

All the years we have been buying property, we’ve noticed different people have different price expectations. This can depend on their circumstances. The fix they are in. As well as their personality.

You need to manage your price expectations.

We know we know.Easier said than done. But now in the last quarter of 2010 the housing market is already passed the tipping point on prices. Any local / regional rises are being held up buy a shortage of suppliers.

If further proof were needed, surveyors are reporting that first time buyers are staying away>

Large companies are making redundancies (Lloyds bank just today) and there will be HUGE public sector job losses as a result of the Government’s spending review.

This is a roundabout way of saying things are not good on the property market front. This has an impact on how all all property buyers feel about how much they want to pay.

Time to wake up and smell the roses.

What does this mean for price you’ll likely to get. Well via a high street agent, keen buyers may still pay your asking price (our friend Annie has just done this). This means you could get lucky. But don’t gamble on it.

The thing is really this. If you have tried to sell and failed, you know just how difficult it is!

You should set a cash price that clears all the secured debt on your property – this means mortgages and loans. In some cases it is possible to negotiate with a lender to convert a proportion of the debt to unsecured, but this is rarely in your interests.

After all, isn’t the point of a cash house sale to be free and clear!

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Property auction versus cash property buyers

Is a property auction the simpler route to getting a cash property sale? How do they compare with property buying companies?

In our experience some people just don’t want to deal with investors, cash buyers or property buying companies. They can’t face the negotiations, fear they’ll be taken advantage of, or think the sale will be problematic in some other way.

Fortunately a property auction can be a realistic alternative for some vendors. Maybe for you. But whether a property auction is the best place to sell your house for cash depends on three things:

Your attitude to risk

How quickly you need to sell

The probability of your property selling well

Why A Property Auction Can Be Better Than Cash Buyers

Property auctions involve an “arms length” transaction. And some might say objective. Dealing with property buyers can involve protracted negotiations. An auction has a “done and dusted” quality to it.

A property auctioneer will advise you on the suitability for your property for an auction.

Assuming your property is suitable to sell at auction, you’ll need to set a reserve price. This may need to be low to get bidders excited.

The risk here is that your property sells for far less than it’s worth. You have to weigh up the pros and cons of going this route.

Generally national auctions carry a range of properties from commercial, corporate and personal clients. Local auctions can be better for selling prestige residential property. A few estate agents have auction arms. These are seeking out.

The irony here is that property cash buyers and property auctions are often interested in the same kind of properties.

However. If you need to sell very quickly, say 8 weeks or less, it may be impossible to get your property into an auction catalog.

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Getting a cash offer for your property is still possible even in late 2010. But different ways of selling, will yield different results.

The first thing to bear in mind is that although money is relatively cheap today, it is in tight supply. This means different types of property buyers will charge varying levels of “premium” for the privilege of buying your house for cash.


Getting a cash offer means – liquid funds

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For the purpose of today’s discussion our cash offer refers to liquid funds. Cash in the bank rather than funds dependent on loans or mortgages.

An estate agent may have access to buyer with funds, but he or she may not know it! Ask local agents if they are aware of cash buyers – people who have already sold or are about to downsize.

Next on your list may be estate agent property buyers. Many people think of this type of buyer as a substitute for estate agents. Well they are and they aren’t.

Estate agent property buyers are the same thing as property buying companies or sell for cash companies.

An estate agent works for the seller, as does the property buyer. Although some people may think they both work for themselves;-).

However. All too often a cash sale, refers only to a chain free sale.

This is due to vocabulary picked up from estate agents, who have always referred to chain free and cash sale as equivalent.

Now depending on your circumstances that may be OK, but you must clarify the terms with the estate agent property buyer exactly that they mean.

This is because in today’s market Buy To Let Mortgages are, like all other mortgages getting harder to come up. And lenders can be extremely fickle in enforcing their terms and conditions.

This could mean that any proposed cash sale is far from being a “done deal”.

Now the level of offer you’ll get via an estate agent and property buyer are likely to be quite different.

This where your motivation comes in. Do you want to sell? Is it a matter of convenience? Or do you really value a quick sale?

Of course, some sellers don’t want to deal with property buyers. We believe this is for a number of reasons, one of which is that they believe other ways of selling quickly will give them a fairer outcome.

So getting a cash offer for your home does not mean you have to use cash property buyers. You can at least investigate property auctions.

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Selling A House For Cash

Selling a house for cash means finding someone with cash. Or does it?

We’ll come back to that question later.

A cash buyer of property can come from a number of places:

Through an estate agent

Property auction

Through an investor

Through a property buying company. Estate agent property buyers if you will.

In response to a private ad.

Are all these types of cash buyer the same? No

If you will, different terms and conditions apply to all of these.

Selling A House For Cash – Best Starting Point

However it’s well known that there are a surprising number of us who are mortgage free in the UK. That translates into a cash buyer.

Just like our friend Nicky, who sold up in London recently to move to Kent. She was literally walking around with £300,000 in her pocket. Estate agents loved her! There are other people like Nicky walking around. Our advice would be that a cash buyer sourced through an estate agent will give you the best possible price.

It’s always worth asking a few agents if they have cash buyers on their books for your type of property. These sales can be done and dusted in four weeks flat.

But if selling a house for cash means selling faster you may have to look elsewhere. There are a number of experienced property buying companies around.

Here we need to make a distinction between lead sellers such as Network Property Buyers and “companies” who will buy directly from you. MPG Investments is one. You can think of companies like this as estate agent property buyers. But rather than find you a buyer they will buy from you directly.

We’ll talk more about that later.

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