Companies that pay cash for homes

debodun

debodun

SF VIP
Location
way upstate in New York, USA
I see commercials on TV for a business that used claim they paid cash for any house in any condition. Now I see thay have modified their ad to "If we can't buy your house, we will find someone that will." I don't know why these commercials set off my alarm bells other than it seems to me that it may take advantage of people that are in a desperate situation and need to sell a home quickly (like to settle an estate). Also, they never mention that they pay a fair market value for the property. I have a casual acquaintence that is a real estate broker and I brought this up to him. He said not to get involved with these companies because they will tie up the property with red tape until you practically have to pay them to take it. Any thoughts on this?
 

Never thought of it before, but I'll agree with your realtor. It's funny, they will pay cash for your home. What else could they pay with, bananas?

Which actually happened in my hometown when I was a kid. A used car lot advertisded a car for xxx amount of bananas. Well, they wouldn't honor the ad and a potentail customer sued. I was too young to really pay attention.
 
I see a lot of those little signs along the road saying that. I have always been wary. But, deb, you are right. Gullible people will fall for it.
 

We used one to get rid of our previous property, we lost about £100,000 of its real value, but it was worth it as I wasn't coping with the large property, since my husband's illness and I required a quick sale.
 
When we had a house For Sale By Owner and advertised online, we got a phone call from some man with an East Coast accent. He wanted to "BUY" {us to legally turn ownership over to him for no money down} and he wanted us to find a renter willing to pay him rent, with a promise to give us a payment every so often. He wanted to do all of this without ever seeing the property in person or paying anything at all.
Somebody is watching too many late night infomercials about getting rich in property ownership/management.
Sad when people assume you just fell off a turnip truck, when you live in a certain part of the country that the movie industry depicts the residents as morons.
 
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Duster said:
When we had a house For Sale By Owner and advertised online, we got a phone call from some man with a New Jersey accent. He wanted to "BUY" {us to legally turn ownership over to him for no money down} and he wanted us to find a renter willing to pay him rent, with a promise to give us a payment every so often. He wanted to do all of this without ever seeing the property in person or paying anything at all.
Somebody is watching too many late night infomercials about getting rich in property ownership/management.
Sad when people assume you just fell off a turnip truck, when you live in a certain part of the country that the movie industry depicts the residents as morons.
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So you really believed he had a Jersey Accent....
 
@debodun "Also, they never mention that they pay a fair market value for the property. "

I've seen those ads. They buy ''as is'', usually to people who are desperate to sell and/or want to do so quickly. They won't pay fair market value, because they usually fix up the home and resell it for a profit. I don't know how honest they are, never dealt with them, it's ''seller be cautious", have a lawyer look everything over just to be safe.
 
I'm sure they will buy anyone's home, but they won't make money unless they buy it for way less than it's worth. It may be a trade-off for someone who's desperate to sell. And there are usually no closing costs or commissions.
It reminds me of those home warranties & car warranties. The only way they can be in business is if they make more money on the premiums than they spend on repairs.
 
Our solicitor was involved when we sold our home to the property company. We had checked them out very carefully, discovering they were one of the better ones.
 
debodun said:
I've heard that these comanies do not want attorneys or real estate agents involved. Perhaps they feel they can take more advantage of the seller.
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Since you'll be paying for the lawyer to check the paperwork in your behalf, if they refuse then I would not deal with them, that is a very big red flag. I can understand their refusal if you want them to pay for the lawyer. They probably get lots of people desperate enough not to make any demands.
 
debodun said:
I see commercials on TV for a business that used claim they paid cash for any house in any condition. Now I see thay have modified their ad to "If we can't buy your house, we will find someone that will." I don't know why these commercials set off my alarm bells other than it seems to me that it may take advantage of people that are in a desperate situation and need to sell a home quickly (like to settle an estate). Also, they never mention that they pay a fair market value for the property. I have a casual acquaintence that is a real estate broker and I brought this up to him. He said not to get involved with these companies because they will tie up the property with red tape until you practically have to pay them to take it. Any thoughts on this?
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Good info.. thanks for sharing. I never paid too much attention to those type of ads because I knew there was some kind of downfall...just did not know what.
 
RR: Bananas!
If you drive a turnip truck around town you will attract many wonderful slim balls

I keep harping on bring back public stocks of Pilgrim era, but doubtful if these folks
give a hoot about public humiliation .
It would cheer me to see folks displayed, with sign no less, "Harold the funeral home crook," 'Hank the thieving roofer'.....
 
Some of them are legitimate and do buy distressed properties at very low prices then repair them and rent them or sell them.

Some of them try to get the homeowner to sign an option agreement to buy the house at a low price and then attempt to sell the property at a much higher price and pocket the difference before the option expires.

Some of them also try to get the homeowner to give them a deed in exchange for a small first mortgage and then rent the house and add a large second mortgage/line of credit.

The goal of the game seems to be to get legal control of the property for the least amount of cash and then flip it or refinance it to pull out a larger sum of cash and move on leaving a trail of heavily financed zombie houses in their wake.

If you have a property to sell go to the most reputable realtor in town and have them perform a market analysis to determine a fair price. Let them list the house for a reasonable price, sell it in a reasonable amount of time and move on.

IMO too many people get hung up on how much money they need to make or how much emotional attachment they have to a piece of property instead of accepting the fair market value of a house quickly. The quicker you sell the quicker the monthly carrying costs stop and the quicker you can reinvest the proceeds of the sale.
 
A few years ago, I had a rental house that had recently been vacated by the tenant. Of course they had trashed it and it need to be fixed up. I was so tired of doing that (for the third time) that I called one of those companies that offer to buy a house for cash quickly. They (presumably) looked at the property and promptly offered me a low-ball price. I said "No thank you" and about a week later they called back and offered a little bit more.

So I bit the bullet and remodeled the house and put it up for sale. After about 2 months on the market I got an offer for double the cash price and promptly accepted.

Lesson learned--I you are so hard up for a cash sale quickly, sell it. But if you want to get a fair price for your real estate, sell it either through a realtor or by seller.

...
 
Aunt Bea said:
If you have a property to sell go to the most reputable realtor in town and have them perform a market analysis to determine a fair price. Let them list the house for a reasonable price, sell it in a reasonable amount of time and move on.
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My feeling, too. You may have to pay a realtor's fee, but things get done legally and above board (I hope).
 
Here’s an example of criminal fraud that comes under the RICO Act while using the housing market.

A group of so-called business people combined to go into the real estate business. They would look for homes with “For Sale” signs in the front yard. They would take 3, 4 or 5 of these properties and bundle them, sell them to private investors and keep the money. The money was then sent overseas and deposited in unknown banks for safe keeping. They would counterfeit the deeds before sending them to the investors.

When the house was legitimately sold, that’s when the fraud would become known. To make this crime work successfully, the group would have to buy these homes from several different locations across the U.S.

The group that we arrested had sold some $15 million in homes. When we made the raid on their office, we confiscated over a million dollars in cash, over 100 kilos, which is over 200 pounds of cocaine and over 50 different firearms. Of course, the FBI took credit for the arrest, even though we did all the work. But, that’s OK, it’s the end result that mattered.

At trial, it came to light that the group was working with one of the New York families, if you know what I mean. And of course, none of them were ever prosecuted. BTW, none of the money, except for the money we recovered in the office was ever recovered. These guys just don’t talk.

So, the mob made $15 million and our 5 realtors got 20 years, plus restitution. Good luck seeing any of that money.
 
I've had experience with them although didn't use them. I found them to be more straight forward than many of the long time neighborhood realtors. They also didn't try to 'sell' you like a used a car salesman. A for sale by owner sign or even word spreads and triggers a ton of solicitations. I had realtors calling a couple times a week just to get our business. The flippers made their bid with a few calling a few months later inquiring about status.

They say they pay about 60% of fully repaired/remodeled value. But having an as-is sale run by a realtor would take away too much and some realtors don't even want budget type houses to sell. They have their place and not everyone can do hgtv.

Also real estate has 'a' market. Sometimes it's good sometimes it's bad. And with many things can't compare apples to oranges. Here it's a 200,000$ spread between low and high priced houses. Just as the homeowner is not entitled to top price the flipper is not entitled to the bottom dollar.
 
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911 said:
Here’s an example of criminal fraud that comes under the RICO Act while using the housing market.

A group of so-called business people combined to go into the real estate business. They would look for homes with “For Sale” signs in the front yard. They would take 3, 4 or 5 of these properties and bundle them, sell them to private investors and keep the money. The money was then sent overseas and deposited in unknown banks for safe keeping. They would counterfeit the deeds before sending them to the investors.

When the house was legitimately sold, that’s when the fraud would become known. To make this crime work successfully, the group would have to buy these homes from several different locations across the U.S.

The group that we arrested had sold some $15 million in homes. When we made the raid on their office, we confiscated over a million dollars in cash, over 100 kilos, which is over 200 pounds of cocaine and over 50 different firearms. Of course, the FBI took credit for the arrest, even though we did all the work. But, that’s OK, it’s the end result that mattered.

At trial, it came to light that the group was working with one of the New York families, if you know what I mean. And of course, none of them were ever prosecuted. BTW, none of the money, except for the money we recovered in the office was ever recovered. These guys just don’t talk.

So, the mob made $15 million and our 5 realtors got 20 years, plus restitution. Good luck seeing any of that money.
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Who wound up losing the $15 million? The homeowners or the private investors?
 
StarSong said:
Who wound up losing the $15 million? The homeowners or the private investors?
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Sorry to be late answering. I have a new job, so I’m pretty busy again.

To answer your question, the investors lost the money. Their own lack of insight cost them a lot of money. These investors were part of a consortium, which is fine, but they never bothered to vett the sellers. The deeds all looked very authentic with the Notary’s seal, stamp and signature.
 
I've had real estate agents stop when I am having a yard sale. My sign says ESTATE SALE an they may assume that I am emptying the house in preparation to sell. They always ask if I am selling and I give them a vague reply such as, "When I can get the contents down to a managable level." Sometime if they go father than that, I'll give them the 10¢ tour. Some lose ineterst after that (which I assume means they can't get as much for it as they first thought or it won't sell quickly). Other give me their business cards and say that when I am ready to sell, let them know. I usually give the realtor I mentioned in my OP first refusal - he did sell my grandmother's house, but wound't take my aunt's to sell.
 

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