If you’re struggling to pay the mortgage on your Minnesota home, you may feel overwhelmed with what to do next.
For instance, you could lease your home to tenants, but that means becoming a landlord. Or, you could let your house go into foreclosure, but that has long-lasting consequences.
Perhaps you’ll decide to sell your house before you lose it. But that too is not always an easy process. After all, selling your house traditionally involves real estate agents, multiple buyers, an escrow company, and the title company.
So, what are you to do when you can’t make the payments on your home anymore?
If leasing your property or foreclosure are out of the question, you should consider selling your MN house to a cash buyer.
Not sure this is the solution for you? Read on to find out what it takes to sell your house to an all-cash buyer and why this might be the option for you.
What Is an All-Cash Offer?
You might think that an all-cash offer on a home is when someone hands over a lump of cash for your property. But that’s not exactly right.
In fact, it’s illegal to hand over actual cash in the United States for a piece of property.
Instead, an all-cash deal on a piece of real estate is when someone buys the property without using financing.
To close on the deal, the buyer will pay for the property by sending the funds electronically or using a cashier’s check.
Your Quick Guide to an All-Cash Sale
All-cash offers usually have a shorter timeline than traditional home offers because there is no need for financing.
Here’s a quick look at process an all-cash offer follows:
- Find an all-cash buyer that is ready to take your home off your hands before it goes into foreclosure
- Accept the buyer’s offer and sign a Purchase and Sale Agreement
- Verify the buyer has the funds to pay for your home, typically by asking for 1-2% of the purchase price upfront in earnest money
- Check with the bank to make sure the rest of the money is indeed available
- Hire a title and escrow company
- Pass the home inspection
- Review and sign closing documents
Why Consider Selling Your MN House to a Cash Buyer
Now that you know what an all-cash offer on your home entails, it’s time to look at the benefits of this kind of transaction.
1. Shorter Timeline
The process of selling your MN house to a cash buyer is similar to the process of selling your home to someone who needs financing. However, the timelines have the potential to be very different.
For instance, it’s estimated that to close on an all-cash offer, the entire process can take as few as two weeks to finish. On the other hand, more traditional closing timelines will take at least 30 days, and can last upwards of 60 days or more.
In addition, finding a buyer that wants to submit an all-cash offer can be quicker than dealing with a real estate agent and buyers that need financing. Plus, you don’t have to wait for banks to approve interested buyers once they decide they want to buy from you.
There’s nothing worse than thinking you have a buyer for your home, only to have the loan fall through at the last minute.
If you’re in the process of losing your home due to foreclosure, timing is everything. The faster you can close the deal on your home, the less money you stand to lose.
2. You Get All the Money
Selling your MN house to a cash buyer means you bypass the fees that come with a traditional sale. This means any profit you make from the sale is yours to keep.
Some of these fees that cut into your profit include:
- Real estate agent commissions
- Closing costs
- Holding costs while the sale is in process (e.g. mortgage, landscaping, utilities, property taxes, etc.)
- Seller concessions
- And much more
This can make a big difference if you’re in financial trouble and need a quick way out of your home. After all, when the sale on your home is complete, you’re going to need money to move forward with your life.
3. There’s Less Risk Involved
As we mentioned above, there is always the possibility that a potential buyer will not be approved for the loan they originally pre-qualified for.
Even pre-approved buyers have to undergo additional scrutiny when it comes to their credit, income, and debt status. And in the end, the bank may decide your buyer isn’t qualified for the loan to pay for your home.
If this happens, you have to start the entire process all over again, which can hurt your chances of avoiding a foreclosure.
When you sell your home to an all-cash buyer, once you verify with the bank that the money is available, and a contract is in place, everything is good.
4. More Reliable Sale
Sure, anything can happen when you’re selling your house. This is especially true if your find yourself in a financial crunch and desperate to get your home off your hands.
However, selling your house the traditional way leaves lots of room for the sale to fall through at the last minute.
For example, a buyer needing financing may be denied a home loan even after the pre-approval process.
But more importantly, since the process takes longer to finalize, your buyer has more time to change their mind and often will because:
- They get cold feet about the sale and just don’t want to buy
- The appraisal comes back lower than the sale price and the buyer can’t secure a loan for the right amount
- The inspection reveals repairs you don’t have the money to fix
Selling your house to an all-cash buyer doesn’t involve all those miscellaneous factors, making backing out at the last minute harder to do.
5. You Can Sell Your MN House As-Is
One of the most significant benefits of selling your MN house to a cash buyer is the fact you can sell it as-is.
Buyers wanting to purchase homes with cash as-is are not bothered if the home has damage, needs remodeling, or is headed towards foreclosure. In fact, all-cash buyers are usually after the homes that are harder to sell by traditional means.
If you decide to sell your home for all-cash, you’ll probably get less for it than if you used a real estate agent and buyer needing financing.
But, when you look at the context, the benefits far outweigh the lower sale price:
- There’s no need to make repairs, clean, or renovate your home
- The quick process means you don’t have to pay the mortgage or other costs for long
- The money is guaranteed and in your hands immediately
- There’s no dealing with real estate agents, staging your home, or multiple showings
- You don’t need to spend any money on closing costs
Lastly, selling your house for all-cash is one of the most stress-free ways to get a problem property off your hands quickly.
If you need to sell your Minnesota house quickly because of a looming foreclosure, contact the cash home buyers of Homestead Road to help. We understand the stress that comes with needing to sell a home fast. We also know that dealing with a traditional sale is not always the best option.
With Homestead Road’s all-cash, as-is offers, we buy the property quickly, fairly, and without you having to do a single thing but agree. In fact, we make it easy for you to bypass the trouble that comes with selling a house you’re about to lose, so you can pick up and move forward, headache free.