Working with a wholesaler is not the conventional way to sell your home. Wholesalers are the people you go to when you need to sell your home as quickly as possible. They cut out the financing paperwork and lengthy formalities that come with listing your home with a Realtor. Time is of the essence for homeowners who work with wholesalers. And oftentimes they are the solution when homeowners find themselves in challenging situations.
If you are in the midst of a financial crisis, wholesalers can help save your credit from the devastating effects a foreclosure. But what exactly is a wholesaler? What do they do and why might they be a good option for you?
What is a wholesaler?
A real estate wholesaler is an individual or company that purchases homes with cash and then sells the properties to other investors who will either flip the property or lease to a tenant. In short, wholesalers purchase properties as the middleman between seller and new owner. Wholesalers never buy to own, instead they assign the contract to a third party.
Why sell to a wholesaler?
In many cases, wholesalers are the only option if a homeowner needs to get a property off their hands as quickly as possible.There are plenty of reasons why selling your home for cash might be the most beneficial option. The decision to accept an all-cash offer will depend on your unique circumstance.
When there are few viable options for a homeowner who does not have the luxury of time or finances to fix up their home, working with a wholesaler is the best bet.
Wholesalers pay in cash with no inspections or appraisals required. Therefore, settlements are significantly faster.
Once a contract is agreed upon between the original homeowner and the wholesaler, the latter party will present the property to their network of investors who would be interested in owning the home.
Wholesalers are okay with buying a property as-is, in its current condition without appraisals and inspections. They pay cash up front and closing the deal can be done in as little as a week as opposed to months.
How do I know if I should use a wholesaler?
Here are some examples of people who need to work with a wholesaler:
- Homeowners with major medical debt or other financial strife that puts them on brink of foreclosure.
- Those who acquire a home in disrepair from a family death and are looking to relinquish the burden and financial responsibility.
- Homeowners going through a divorce
- Homeowners facing imminent relocation
Because wholesalers are all-cash buyers, the transaction process is a lot faster than typical buyers who take a mortgage from a bank. Wholesalers don’t need bank approval, paperwork, or appraisals to finalize their purchase and that shorter timeline is beneficial to anyone who needs to get their home off their hands as quickly as possible.
Are real estate agents and wholesalers different?
Yes. Real estate agents help facilitate the sale of the home and they make commission off of the sale.They do not purchase the homes themselves. Wholesalers purchase the properties and do so with cash.
Real estate agents are also licensed to show homes to potential buyers and help sellers market their homes. Because wholesalers aren’t licensed agents, their deals are done by reaching out to an existing list of buyers: other investors such as house flippers and landlords.
Wholesalers tend to go for properties that need a little work and they are okay with purchasing a property as-is. Because of that, they purchase properties at a lower price than what a home would be worth in good condition.
What are the benefits of using a wholesaler?
You get more privacy and don’t have to have your house ready for would-be buyers. When homeowners list their property the traditional way, they must be prepared for would-be buyers and inspectors to walk through the front door at a moment’s notice.
The process of selling the home is much faster with a wholesaler buying with cash since there is less paperwork and no banks to work with. In fact, cash sales can close in as little as 1-2 weeks. Oftentimes when accepting an all-cash offer, the purchase price will be lower. While you might receive less money than the value of the home, the trade off is the speed of the transaction, convenience, and selling the home as-is.
Curious about the other benefits? Read our complete list here.