How to determine if “we buy houses” companies are credible
Chances are you’ve seen signs advertising companies that buy houses for cash.
Often times they say things like “We Buy Houses!” or “Cash For Your House.” While we do not hang signs like those (we think they’re tacky), we operate in a similar way since we can buy your house with cash.
Some online reviews of house buyer websites, which are written by real estate agents, claim that companies who buy houses are only out to low-ball, pay only what your mortgage balance is, and ask for fees up front.
Very rarely are those the cases, and these articles are intended to scare you out of working with an investor, but consider the source of the writing.
So how do you know if a local house buying company is honest and credible?
Buying and selling houses is a valid and respectable profession that can help communities and house sellers in many ways. That is why there are thousands of real estate professionals in every Bay Area county.
But just like any other line of work – a minority of house buyers in any market are the ones who make the rest of us look bad. (This is actually true for EVERY profession if you think about it). We’ve all heard stories about crooked cops, shady contractors, medical malpractice, greedy attorneys, and the list goes on.
Most home buying companies are actually ethical folks who seek make a profit while improving a neighborhood and helping a homeowner sell a house fast. A win-win-win, if you will.
And then there’s shady, dishonest people who put money ahead of the well being of their clients and who would sign the contract to sell their own grandmother with one hand while stabbing you in the back with the other – as long as they were making enough money.
Yes, they are out there.
We’ll help you avoid these “shady house buyers” so you can work with honest, ethical, and reputable local companies who can buy your house for a fair all cash offer and close on your schedule.
But let’s not focus on the negative – at least not yet.
First, let’s cover exactly what real estate investors are doing.
What Reputable Cash Buyers Like Skye Homes Are Doing
- Helping folks improve their lives by accessing the money they need right away. People often need the cash in their house to cover unexpected medical expenses, or to relocate to be close to a relative. We can make that happen in just a few days, and we deliver peace of mind.
- Helping sellers get rid of a burdensome property without the hassle of having to list it with a broker and wait months and month for a sale.
- Creating local jobs. We hire plumbers, contractors, electricians, brokers, title reps, loan officers, administrators and many other folks along the way. The average real estate transaction involves 86 people from start to finish. Our investments help create real jobs for people around the Bay Area. You likely have friends and family who are somehow involved in the real estate, finance, or construction fields. They all benefit from the additional activity investors create.
- Buying U.S. products. We spend tons of money on materials that are made right here in the USA – that creates jobs in our timber mills, factories, supply shops, distribution centers and more. The US economy depends on steady improvement, and that requires investment from folks like us.
- Increasing the value of Bay Area neighborhoods. When we improve a house, we’re helping to increase the value of the entire community. We often repair abandoned and neglected houses, turning them into beautiful homes for families. That activity strengthens neighborhoods.
- Increasing the tax base. When a new buyer takes over one of our properties, they’ll pay a higher tax rate based on the new and improved value. Those taxes go to pay for our schools, fire, police, libraries, streets and other valuable pieces of infrastructure. Again, improving our neighborhoods.
Pretty cool stuff, right?
Lots of people think of house-flipping as a get-rich-quick scheme. That’s fueled by unrealistic reality shows that amp up the drama because the reality of what we do on a daily basis is actually pretty boring.
Most of our work as a house buying company is coordinating with lots of people to make sure things are happening on time. We have to keep track of a lot of moving parts.
So let’s get back to how you can use this information to find out if someone is a credible home buyer.
How To Ensure You’re Working With A Reputable Local House Buying Company
When you talk with a local house buyer to potentially buy your house… ask them some of the questions below to ensure they’re reputable, knowledgeable, and honest.
First, go to the cash buyer website (they should have one) and read their “About Us” page. Are the owners introduced? Do they have pictures? Links to their social media sites?
If the answers are “no,” what are they hiding? More often that not, a real estate investment company who buys houses is a small business, meaning, it is run by individuals. Individuals who are purposely not including biographical information. We think this is a red flag!
If you’ve found a company that passes the first test, speak with them and ask open-ended questions such as:
- How do you help your clients?
- What do you do for people?
- Can you tell me more about your services?
- What aspect of your business makes you the most proud?
- How can I know that you’ll close on my house when you say you will?
Third, look for tell tale signs of tactics that those few shady operators tend to use.
- “Kitchen table closings” – Most reputable house buying services will perform the actual closing of the sale at a neutral 3rd party place… like a title company. Closing at a title company ensures everything is done right and on the up-and-up. Skye Homes will meet with you to form an agreement for the purchase and sale aspect, but the formal signing will take place at a title company (unless you are unable to physically to do, in which case the title company can hire a mobile notary).
- Pressuring you into a fast closing – If a house buyer tries to pressure you into selling your house and says that you have to make the decision today, be leery. Most reputable house buying services will make you and offer and that offer will be on the table for at least 2-7 days (minimum) for you to make a decision.
The reason reputable house buying services like ours at Skye Homes do place deadlines on our offers is because the market changes and values can change week to week depending on other sales in the area, also… we buy multiple houses a month and when we make you an offer we’re assuring you that the cash to purchase your house is ready and we’ll reserve that cash for several days so if you do want to sell your house, we can close on your schedule.
If you feel the offer isn’t a fit for you, then we’ll assign those funds to help another seller with their home sale.
True investors who run honest and ethical house buying services, however, are building long-term businesses based on relationships and community development.