What does it mean to sell my house for cash?

flowerbud1977: What does it mean to sell my house for cash?
We need to sell our house quickly due to relocation. I’ve contacted a couple of those websites that offer to buy your house no matter the condition for cash. My house is in great condition and we know we’re going to take a hit financially whether we try to sell it the ‘old fashioned’ way or otherwise (we’ve only had it a year and homes don’t appreciate well here, even with a good market). My questions are these: What are the pros/cons of selling for cash? How do I pay off my mortgage if I get ‘cash’? Will it affect my credit? Will I take a hit from the IRS? We really need to be out of here in about 5 weeks. Our house has been on the market now for about 2 months with little to no response – Texans and their irrational belief that any house with an upstairs master is not worth their time…
Please, any useful advice would be greatly appreciated!
Thanks to those who have reponded so far. First, yeah I know it won’t be a big bag of cash with a dollar on it or anything, haha! Also, it’s listed slightly below market value at this time and if we go any lower we will be selling it for less than we bought a year ago. Renting – we’ve got it listed in a couple of places, no interest in that either right now and it makes me nervous to rent when we’ll be out of state.
Thanks for such great answers. I should totally take back what I said about Texas and their beliefs. I know prideful people in TX can be and honestly, I do understand the downstairs master thing, we just prefer to have all beds up and knew it would make for a difficult sell later on. We just didn’t count on having to make it sell after just a year. I’m in Houston, by the way.

Answers and Views:

Answer by Ask M
Just make sure you at least take cash to pay off the
current mortgage and walk away even. You close
enough to any college that would rent it ???? Military Base?

Answer by I_Love_McRedneck
Have you considered a lease option? You usually collect 2 to 3 months rent as a deposit in case they do something stupid and destroy the house. You negotiate a selling price after a set amount of time, usually a year or two. They either buy it and get their deposit back or they don’t buy it and you get to use the deposit to repair their damages if needed.
At least you’d have your mortgage paid for a year.
Don’t “sell your house for cash” – they’re lousy deals. If you really must sell asap, consider lowering your asking price.

Answer by Glennroid
When you sell for cash, you’re getting money from someone who’s not taking a mortgage. It doesn’t make any difference, you’re still getting money. You’re not actually going to get a bag of cash, you’ll still get a check. You’re just not getting it from a mortgage company.

So it doesn’t make any difference at all. At your closing you’ll give the “cash” to your mortgage holder and sign lots and lots of papers. Just as if you got the money from a buyer who was getting a mortgage.

If you’re not getting any interest in your house there’s a reason: it’s listed too high! Period. People think they can get what they think a house should be worth and are frequently disappointed. If you want to sell it, list it a the fair market value or a little less. If you’re not getting any lookers and it’s a good house then you’re asking too much.

Good luck!

Answer by tiscpa
They don’t want to give you much for your house.
Expect to take a big loss.
Typically they look for houses that the sellers are desperate and will sell well below tax value, which they want to pay way far lower than market value.
Their intent is to make a profit. Think of used car sales. You trade in your car and they don’t give you anywhere near what it’s worth.
If you have a high mortgage balance, then you may as well as forget it. You don’t want to sell for cash and still owe a balance.
Instead of used car dealers, they are are used house dealers.,
They buy to fix up to sell for a profit or to rent until they sell it.
Is it worth selling that route? No. Then again it does depends on your situation.
Sometimes it’s best to cell at a loss to avoid a bigger loss.
So, that’s something you’ll need to think over seriously. Weigh carefully your options.
You might want to look into having your house managed and rented out for you by a professional real estate company who specializes in doing that.
Anyway, be careful and investigate your options..
I know a couple who moved and couldn’t sell their house and they had a company to manage and rent to for them. It’s been about 3 – 5 yrs, and so far that has worked out well for them. The mortgage is getting paid, while they’re still building equity into the house. You may want to consider that.
Think carefully your options. Hope things work out well for you.

Answer by DJ B
Here is my suggestion: Either do this yourself or hire a company that handles these routinely. AUCTION

DETERMINE YOUR BOTTOM LINE. Schedule the auction two weeks in advance, with 4 hour window for viewing. State all buyers must have PRE APPROVAL LETTER OR CASH, IF BORROWING – MUST CLOSE WITHIN 30 DAYS.

You have options, but you need to make quick decisions now because time is short for you. If I can assist further, please email me. Best of luck! Realtor in Minnesota

Answer by frankie b
Honestly it doesn’t make much of a difference to you. The normal upside to a “cash” deal is you can close fast, and they you do not need to meet any mortgage contingencies. In the end the closing will be the same and the closing attorney will pay off the mortgage and give you the cash left over. No different than if they got a mortgage. In the end cash is cash no matter if it comes from the bank, or a private person.

Answer by liveinaustin
1. Cash sale: typically allows for quicker close with no issues typically associated with financed sales.

2. Current Mortgage: the title company will take care of paying off the mortgage and this will be reflected on HUD-1 (closing statement)

3. Credit: It will only reflect that you’ve paid the debt in full

4. IRS: No, you aren’t making anything so there’s nothing to take a hit on

If you purchased the house new and have only been in for a year, you’ll more than likely take a financial hit and then some. You may have to come to the closing table with YOUR cash in order to get the home sold, but the only thing worse than that is trying to be a long distanced landlord doing repairs after some goober destroyed your home while renting.

As far as Texans (as you can see, I live in Texas) irrational beliefs….I can only say that an upstairs master bedroom is not nearly as popular for most buyers because if an individual has knee, back, hip, etc. surgery, they’ve essentially cut themselves off from their bedroom for a period of weeks, if not months. Doesn’t happen often, but it’s happened twice in my family so I can attest to this.

Where are you located?