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Tactics used by predatory home buyers in Sacramento

Watch for these tactics used to lure you into a scam when selling your  home off-market

Selling your home by way of a nontraditional means requires you to do some of the homework on finding a company/cash buyer to sell your home for cash that is worthy of your trust and business. If you are in a time crunch, these more progressive ways of doing business can really come in handy. iBuyers such as RedfinNow and Opendoor are online real estate companies that buy houses which primarily do all of their business online. This business buys houses via technology from offering the quote to signing the deed. However, sometimes the numbers you receive on the house buyers website are too good to be true, and oftentimes they are. When dealing with online house buyers, you have to be sure that you deduct a significant chunk of money from the initial quoted price that comes from their service fees, closing costs, repair costs and sometimes more. 

If you do decide that using a iBuyer to sell your home is the right choice for you there are a few things to keep on the forefront of your mind when completing this type of business. Occasionally it is in your best interest to lower your expectations of this selling experience especially in the numbers. When iBuyer spits out a price for your home based on your given explanation of the properties conditions, this price is before the company has sent anyone out to do an inspection of the potential repairs that may need to take place before you get the money in hand for the sale. Because of this, it is not much different than doing business with any other cash homebuyer, the main distinction is that cash homebuyers don’t try to lure you in by making any false promises of numbers in the beginning before seeing your home. 

How do I sell my home fast for cash using an iBuyer? 

  1. You start the process by filling out an application online with information about your home and its current state. 
  2. An online calculator produces a number or what the company is willing to pay for it using public data and basic rule-of-thumb math about your home’s location, age, and the current market value based on the information you provided. This offer price doesn’t reflect the number of additional expenses and fees. 
  3. After you accept the offer (despite the company not seeing your home first), the iBuyer will send a representative out to the property for an inspection. 
  4. If the state that your home is in does not meet the description provided by the homeowner online to their standards or if they see immediate repairs that need to take place, they will ask you to make the necessary repairs or reduce their offer price by whatever their policy is for that repair (foundational or system issues). 
  5. In addition to immediate repairs, if work has been done to your home such as unpermitted additions or conversions, septic system issues, HVAC issues, etc. iBuyers will reduce their offer price again to take into account the price for these upgrades and renovations that have to take place before they will take it. 

A number of iBuyers have a fixed set of criteria and standards that the home has to meet for them to move forward with the sale of your home. However, they won’t even know if your house meets the criteria until after they have sent someone out to inspect the home, even if you already accepted their offer. At this point, time and energy has been wasted which in some cases for people selling their home through the off-market ways, may not have to expend. 

Online home buyers make the majority of their money from charging their customers service fees which can be as high as 5-8% of the sale price, and their ability to sell quick homes. Closing costs, title and escrow fees, and service charges are not displayed in the initial offer price they produce making this process feel like a scam to those who aren’t aware that that is how they complete their business.

When iBuyers make this offer in the beginning, they are doing so before a representative has walked through the home, evaluating the home’s interior, exterior and major systems. No buyer on the market can make a dependable offer until they have seen the location. iBuyers will lower the price before finalizing the transaction leaving you with less money than you were originally given. 

In the worst cases, iBuyers may back out of the entire contract post home assessment because of the issues they may have come across. This leaves you high and dry having spent the time and effort and expenses of getting your home ready to sell to then be let down. 

Watch out for ‘Cash-Buyer’ Wholesalers

Predatory wholesalers will take the same tactic used by iBuyers, offering a “vanity offer” or cash without seeing your home first. And just like iBuyers, they will deduct the offer price from the costs based on issues and repairs they find that need to be made after already giving you a number you thought would be solid. Once these types of wholesalers find out what problems your home has they will “walk-back” or “walk down” their offer with a list of repairs that some sellers cannot even verify. These types of predatory buyers have their intentions in the wrong place, putting their customers in a position to commit to an attractive cash offer before you realize their plan to lowball you in the end once you’ve already put time into the process. It goes to show that unfortunately there are companies out there who want to lure people in with general “we buy houses for cash” statements and not being fully transparent. 

If you are in a hurry to sell your home, they may try to take advantage of your situation, knowing you don’t have the time to start over with a different cash investor or with a real estate agent to put your home on the market. 

Is the Cost Worth the Convenience? 

When you sell your home to a person or through a real estate agency, it may take you longer to receive the set-in-stone final number of the price of your home. This is due to the fact that with more traditional types of sales, the organized process consists of a home inspection of conditions and sometimes repairs that need to be completed before selling the home. While there is no promise to sell your home fast, the better part about handling the sale this way is that the numbers are calculated in front of you. The costs and benefits that your home has to offer you is figured into a set price that your home will potentially go for with little margin and sold with your complete involvement, making it an honest purchase. With thorough conversation about your home first, unlike with online sales, your expectations and hopes are not raised in the beginning to set you up for disappointment in the long run. 

Homeowners are often required to decide whether they want to put in the time and effort for the necessary repairs to follow through with the sale to the iBuyer or get a significantly lower price for their home. While iBuyers might be the best companies that buy houses for cash that works for you, there are still other off-market buyers to consider. With Invseco’s competitive marketplace for homes in need, even if your home is going to require some tender, loving care, you know you’ve come to the right place to sell. With Invesco, you can expect higher cash offers from real estate investors without getting charged the nines with fees later on. 

If you do decide to do business with an iBuyer, be sure that you have done your due diligence to understand the difference between your cash offers for home price and your net proceeds computed after the numerous fees are subtracted from the total amount, they do add up. 

Choose Invesco for Smarter Investment

Eliminate the hassle with Invesco Property Solutions. With our company, we work with you to match your schedule, financial circumstances, and comfort level. With Invesco  Property Solutions you don’t have to stress about cleaning out your home, making the repairs, or dishonest numbers. You can simply decide what you need to take from your home and leave the rest to us. You benefit from saving your time and energy on repairs and struggling to find funds for the costs with no obligations to accept inaccurate offers. 

Let us compare what you’d earn by selling your home via a traditional listing vs. what you’d earn with a direct sale, and you’ll see that our offer is fair. We want you to compare for yourself to help you make an educated decision about the best way to sell.
If you’d like to get a fair cash offer on your house or to sell house as-is for cash, Invesco Property Solutions buys houses for cash in any condition in Sacramento county. Contact us today at 916-455-8515 to learn more about a different home buying process.