There are plenty of options to sell a house in 7 days, providing the following circumstances are in place and your investor buyer knows what he is doing. Usually it takes weeks to months to sell a house and a lot of sellers just don’t have that kind of time. As is described here however, you can sell fast if you want to. To the right buyer there are certainly plenty of ways to sell within days.
Sell to a cash buyer.
The first way to sell your house is to an investor cash buyer.
While negotiating and signing a contract can be done quickly, these are some common delays.
- Usually an investor will need to get a title policy that guarantees title, this is handled by the title company and in the best cases can be done in days.
- If an investor requires an inspection then they will have to wait for their inspector to schedule an inspection and then provide the required inspection report.
- If an appraisal is needed then that will also have to be scheduled and the appraisers report prepared and provided.
For all cash deals however, typically only the title policy is needed. So inspection and appraisal time may not be an issue.
So in the best of circumstances and if the investor buyer has a very fast team (title company, appraiser, inspector, private lender) who is not backed up on properties being worked on then it could be possible to close within 7 days.
Sell to a hard money loan investor buyer.
Another way to sell quickly is to an investor with a hard money loan lender, which is a kind of private financing.
A hard money lender (HML) is a private lending company, with access to private funds. This is the most common form of purchase for ugly houses that need to be rehabbed. As the condition of these properties makes it difficult to get a new conventional loan and also the short time frame available eliminates the conventional mortgage option. For the seller of the property, they are in effect getting a cash buyer in this scenario, because they will be cashed out at closing by the investor.
HML’s also require a Title policy, appraisal and survey. Often the investor will have the right people lined up who can do these jobs quickly, again the time frame to obtain the title insurance policy will be a key factor to being able to close within a few days.
Sell Subject-to existing financing.
Another way to sell your house quickly, is to an investor who will buy “subject-to the existing financing”. In other words, the investor will assume your financing on the house and take over your payments. Under these circumstances, the loan will usually stay in your name, but ownership and control of the property will be transferred to the buyer, sometimes in the form of a land trust. The investor will then have to bring all the payments current and commit to making timely payments from there on out.
This is one of the fastest ways of selling a property, because waiting for new financing is no longer a factor and it can be a win-win situation for both the seller and buyer. The buyer does not have to spend a lot of time and money obtaining new financing, so they can buy with smaller profit margins than they would be able to under the Cash and Hard Money options. The seller is able to get the house off their hands quickly, by transferring control and ownership of the property.
In this scenario seller typically still has the loan in their name and technically still has liability for it, but the right investor can actually help to improve the seller’s credit, by making timely payments and showing good credit history for the seller.
Sell to a short sale buyer.
In the event that you (the seller) have purchased, or refinanced the property in the last few years, you may have little to no equity in the house. This common situation will stop many investors from even making an offer on your house, because they don’t believe there is enough equity in the deal to make it work. There are however, investors that specialize in doing short sales.
In this scenario, the seller is often several payments behind and may even be close to foreclosure, the seller can also show significant hardships that have led them to being unable to continue making payments on this property. The seller will give the short sale investor a contract to purchase the property, a deed that will might be placed in escrow, power of attorney and a number of other documents that will give them full control of the property. The investor will then present a case to the bank holding the mortgage, that the seller is no longer able to make payments, is having to relinquish control of the property and that the loan on the property must be reduced in order for the investor to purchase the property.
These are not called short sales, because it takes a short time, in fact this kind of transaction can take up to months of waiting on the bank.
This has been included as a method to sell your house quickly, because effectively you pass over control of your property to the short sale investor immediately upon signing of the documents. From that time on, it is up to the investor to complete the transaction. Should a bank refuse to accept the investors offer on a short sale, there is no guarantee that the house will not go to foreclosure anyway, but this does provide the seller a “possibility to avoid foreclosure”, when all else has failed.
Sell owner finance.
Among investors if you can sell owner finance this may be their most preferred choice. When a seller has all, or a lot of equity in their house, they then have the option of financing it to an investor (aka: owner finance). For some sellers it may be more advantageous to receive payments over a period of time with interest, rather than receiving all of the cash at once and needing to find somewhere else to invest it.
This is like the seller stepping in as an investor, by keeping their own money invested in the property. They have the comfort of knowing it is well secured and they will receive an agreed upon rate of return. For the investor, it makes it possible for him to put the property to use quickly, without having to spend additional finances and resources up front.
An investor will usually have to rehabilitate and or, repair the property to bring it up to a rent-able condition. This investment helps to secure the sellers position in the property, because the investor now has their own time and money invested as well.
Sell on a lease option.
A lease option could be considered when there is not sufficient interest in your house to find an investor who will buy it outright, or even subject-to the existing financing. [In Texas this is presently not a common or feasible option (for long term leases), due to regulations written into Texas law about a decade ago.]
An investor may sometimes lease option a house, even if their is not a lot of equity available for them, with the interest that the property will appreciate in the future and they may be able to get some cash flow from the property as well. The investor will lease your house, with the option of buying it at a preset price after xx years. His lease will also give him control of the property, the right to sub-lease the house out to whomever they choose.
This “sandwich lease” may give the investor some cash flow if they are able to lease the property out for somewhat more than they are leasing it from you. Almost as if you had hired a management company to take over the leasing out of the property, you are not however paying them a set price, but allowing the investor to make whatever they are able to. An investor may even sell the house on a lease option, so at the end of the option period, their buyer buys them out of the property and the investor buys you, the original owner out as well.
Sell with an equity sharing deal.
Equity sharing might be something to consider if you have plenty of equity and need to sell fast, but can’t find an investor who will buy your house for cash outright.
In the event that you have a significant amount of equity in your home, you may not want to sign all of the property over to the investor. You might decide to do a combination of one of the above and an equity, or profit share. The investor might agree to pay you a certain amount of cash and then take over payments, for example. If the investor is not prepared to pay you cash up front, they may offer to do a future equity share on the profits. They may also give you a 2nd place lien on the property and agree to make payments on an agreed upon portion of your equity.
In any case, if you are a motivated seller, there are many solutions to each problem and the ideal strategy may vary considerably in each situation. The method that you are actually able to sell may become limited if you are facing any time constraints. The important thing is to explore your options early, as you may have less of them the longer you wait.
This list is by no means the only methods one could sell their home, as there are plenty more creative options one can consider and negotiate. If you have found the right investor to work with, they may have plenty of ideas about what options to offer you. You may also end up using a combination of these strategies.