These businesses exist to make a profit.
Today I’m joined by our Director of Development here at RE/MAX Capital Realty Shadd Boucher to talk about the real facts concerning the flood of companies who offer to buy your home.
We’ve seen these sorts of advertisements all over—on the radio, TV, internet, and on signs around town. Shadd himself recently sold his home, and approached several of these companies to see firsthand what it was all about.
While these sorts of companies certainly have a place in the market, they’re mostly for people who are in a hurry to sell their homes and are willing to sacrifice their equity in order to speed up the process.
These businesses exist to make a profit, so they have to buy low and sell high. They advertise that they’ll offer a fair price, but is that really the case?
Shadd says that their offer was a bit less than what he’d expected, given his own 20 years of real estate experience. However, the price itself wasn’t unreasonable - what was unreasonable were all the fees that came from the back end of the transaction - starting with a 7.5 percent fee. Then there were potential additional fees charged following their inspection of his home. With all these fees added up, Shadd was going to make much less than if he had listed the property with a real estate broker and sold it on the open market.
The total charges could have been as high as 12%. Additionally, it was written into the contract that they had the right to cancel the transaction at any point up until the last minute; they had an open maintenance policy that was supplemental to the contract, allowing them to cancel the transaction 10 days after their representative was able to view the house, and that timeframe was not specified in the contract.
If you have been considering a sale and wondering about the tradeoffs of working with one of these companies, feel free to reach out to me. Lately, we’ve had to assist clients who have started off with companies like this, and discovered that unknown details ended up costing them time and money. We’re always here to help you and to look out for your best interests.