Options For Differentiating Real Estate Brokers And Investors

​

When people think about selling their homes, they typically have a very specific process in mind. Interested parties gather to submit offers after your home is listed on the open market by your real estate agent, and you ultimately accept one of them. That process is used in some home sales, but it's not the only one.

 

Sellers have another choice thanks to real estate investors when trying to sell their current home. Understanding how they differ precisely and why one might be better for you than the other can be difficult, though. There are multiple ways to distinguish between real estate agents and investors.

 

To List Your House or Not to List Your House

 

A real estate agent or Realtor will attempt to sell your home using a particular process when you work with them. As professionals who have been granted licenses by their state and local governments, they are bound by certain rules when working with you. You both agree that when negotiating the sale of a home, they will serve as your sole representative. They then list your home on the MLS and other real estate listing services under their name and company. If prospective buyers are interested in learning more about your home or attending an open house, they must get in touch with your real estate agent.

 

The ability to delegate so many tasks to someone else is the most obvious advantage of working with a real estate agent. Theoretically, that person is knowledgeable about the local real estate market, laws, and market circumstances. They'll be able to navigate the bureaucracy and take care of all the paperwork and costs you need to handle to list your house for sale.

 

You can speak with a real estate investor if you decide you'd rather not put your home on the open market or deal with numerous potential buyers. An investor in real estate (also known as a cash buyer or as-is buyer) will meet with you to discuss your home before taking you on a tour to assess its condition. They will make you a cash offer on your house based on this and any relevant information about the property (financial concerns, tenants, hoarders, termites, etc.).

 

The costs, time, and commissions associated with selling a home through a real estate agent are completely avoided despite the fact that this offer is frequently below market value. The key is that the investor wants to buy your property "as-is" (in its present state) and fix it up so they can sell it again for a profit (or be a landlord to tenants on the property).

 

A Different Timeline

 

You are frequently at the whim of the open market and potential buyers when selling your home through a real estate agent. It will probably be between two or three months from the day you list your house with an agent to the day it starts the closing process, even though there are a zillion different factors to take into account and every house is unique. After that, it will probably take an additional one or two months for the closing to be finished, for the buyer's lender to approve the loan, and for you to receive all of the money specified in the sale agreement. Of course, if the market isn't in your favor or if the state of the economy is dire, it could take much longer.

 

The process is much faster when selling your home to a real estate investor. The seller has the discretion to choose how quickly they want to complete the sale. The seller may decide to close the deal within days, and the investor will frequently make their offer within days. Since there are no mortgage companies or real estate agents involved in this process, there are a lot fewer conditions, costs, and agreements that would otherwise extend the timeline. You are not awaiting action from those on the other side in order to proceed. The transaction should be completed as soon as possible for both parties.

 

Considering Commissions

 

Realtors and real estate agents put in a lot of effort on the seller's behalf. They handle all of the listings in addition to handling the negotiations for you. They work with buyers and their agents and are skilled at negotiating the best price for you. But none of this work is being done for free.

 

A real estate agent you hire will receive a commission when you sell your home. Additionally, that commission fee may be higher the better or more well-regarded the agent is. Sellers should anticipate paying the agent up to 6% of the sale price, which will reduce their profit after paying off any outstanding debt and other costs. This means that if you sell a home for $200,000 and make $25,000 in profits after closing costs, your agent will receive $12,000, giving you a total profit of $13,000.

 

Of course, you could work with a discount broker instead, but you wouldn't receive all the services that other agents would.

 

There are no costs or commissions when you sell your home directly to a real estate investor. You don't have to worry about the costs associated with hiring a real estate agent, an appraiser, or an inspector because you won't be working with any of them. The real estate investor will make you an offer, and that is the only figure that counts. They may also pay for any closing costs, which significantly reduces your financial obligation. Given their business model, the offer they make will undoubtedly be below market value, but you can compare it to your actual profits if you went through the entire market sale process along with the time investment required.

 

Are you looking to work with a real estate investor or are you just looking for a free estimate? To learn what kind of offer you can receive without paying the fees and expenses associated with real estate agents click here.