Are Cash-for-Houses Companies a Scam?

If you need to sell your house fast, then you want to explore every option. You’ve probably seen some ads or promotions for companies that buy houses for cash. Can you trust these companies? Is it too good to be true?

Below, we’ll break down the whole business so you don’t have to wonder.

Are They a Scam?

No. 

It’s really that simple. There are many cash-for-houses companies across the country. They are licensed, tax-paying, legitimate businesses. The point of these businesses is that paying cash for a house allows them to acquire properties a little bit cheaper than if they were buying with traditional loans.

They then flip or rent those houses to turn a profit. It’s actually pretty normal real estate stuff.

As a matter of fact, many thousands of houses are sold this way every year, and it’s becoming one of the more reliable and popular ways to sell a home.

So, no. They aren’t a scam. You can explore this option, and it might make selling your house even easier.

How to Spot a Cash-for-Houses Scam

Cash-for-houses companies are not a scam. Unfortunately, that doesn’t mean that the real estate business is completely devoid of scams. So even though you can work with trustworthy companies, you need to vet the real companies from the scammers, and for that, there are a few simple tips that go a long way.

First, any legitimate company has a business license, registration, and insurance. You can ask to see these things, and then you can verify that they are legitimate. You can look up the company with the Better Business Bureau to make sure that their credentials are in place.

Second, when you sell your house for cash, you don’t get a suitcase full of hundred-dollar bills. You also don’t get a personal check. You still go through an escrow or brokerage service. This is a third-party, professional service that verifies that the money for your house really does exist and will be accessible to you upon closing.

If you’re not comfortable with any of that, you can involve your bank when you sell your house for cash. In fact, if there’s still a mortgage on your house, you’ll have to involve the bank. So lean on their expertise to verify that the funds are legitimate and that everything is above board.

A cash-for-houses sale is still a normal house sale. The only major differences are that it’s fast (because the company is extremely experienced with the process), and you can skip realtor fees.

How a Legitimate Cash-for-Houses Company Works

Another way to feel more comfortable about cash-for-houses companies is to understand how the process actually works. In general, you can boil the whole thing down to four steps: contact the company, schedule a walkthrough, receive an offer, and close the deal.

Let’s look at these a little more closely to remove any mystery. We can’t speak for all cash-for-houses companies, but this is how we do things.

First off, most cash-for-houses companies don’t do cold calls or other things where they will contact you directly. Instead, they build a website, possibly advertise a little, and wait for you to initiate contact. When you do, there is typically an online form that you can fill out. It’s going to ask you for contact information, the address of the house you want to sell, and a few simple things about the house.

After you fill out the form, we will get in touch with you. We want to see the house. It’s the only way to make a reasonable offer. So we’ll contact you and plan the walkthrough around your schedule. Keep in mind that you don’t have to do anything special for this walkthrough. We buy houses as is.

Once we see the house, we’ll crunch some numbers, and then we’ll give you a formal offer. In order to see the offer, you don’t have to sign any forms. You don’t have to make any commitments. That’s the biggest indicator that you’re not dealing with anything unsavory. We’re going to make you a no-commitment offer. If you like it, we’ll move forward with the paperwork. If you don’t like it, no hard feelings. That’s your ultimate safety net.

If you do accept the offer, then we’ll walk you through the closing process. 

That’s it. That’s how it works, and if you see a potential cash buyer deviating from this, exercise caution. Again, other companies might do things a little differently, but this is a solid blueprint for how the entire process should look.

If you want to see behind the current and go through the process yourself, you can contact We Buy Houses Columbus today.