You’re ready to sell your house, but renovations, repairs, and a refresh are costly. You might consider selling a house as is. That might mean lowering your asking price, but you may decide that is an acceptable outcome.
When you sell your home for sale “as is,” it signifies that you are unwilling to do any repairs or upgrades before closing. You’re showing the buyer that they must accept the property in its current condition, with no guarantees or warranties from you about the state of the home.
We will review what selling houses as is means, information about the sale, and how to find buyers for your home.
Info for Selling a House As Is
When you sell a house as is, what does that mean?
For potential buyers, it means the buyer is purchasing the home in its condition. Typically, the buyer should not expect you to do any repairs, but they will still get the home inspected.
That doesn’t mean you can withhold information about the house. You still have to disclose specific facts. And your state will typically have a Seller’s Disclosure Form that you must complete as part of the purchase.
Selling a house as is may be your ideal strategy, especially if you don’t have the cash for extensive repairs. Another reason for selling may be that you don’t want to endure the hassle and time of enduring a house renovation.
Do You Lose Money Selling a House As Is
Selling a house has several advantages: you finish the transaction quickly, avoid expensive repairs, or deal with the rigor of selling a home with a real estate agent.
In the next section, we will review the pros and cons of selling a house as is, and we will help you answer that question.
Pros and Cons of Selling a House As Is
There are some distinct advantages when selling your home. To make an informed decision, weigh the advantages against the disadvantages that we provide for you.
Pros
- Quick closing: No repairs. No cleaning. Usually, your buyer will be a cash investor who doesn’t have to wait for a loan or worry about repairs.
- Negotiate less: Provided that your buyer has the cash to buy your home or a secured loan, you may be able to get to closing day faster. Typically, you’ll have fewer negotiations for seller contingencies.
- Save money: You will avoid paying the costs of selling your house. These expenses include:
- Closing costs
- Repairs and renovations expenses
- Staging costs
- Real estate commissions
Cons
- Affects sale price: This might be the most significant con. When selling a house as is, you may not get the full value of your home. The speed and ease of the sale may make it worth it.
- Limits buyer pool: Buyers may see your as-is listing as a problem. A higher sales price indicates to the buyer that you’re willing to negotiate on necessary repairs discovered during the home inspection.
- Repairs are still a possibility: You may list your home as-is, but that doesn’t mean a buyer will avoid negotiations. You have the latitude to entertain these negotiations. To make a sale, it might be in your best interest to fix any minor issues brought up by the buyer.
Reasons Why You’d Sell a House As-Is
Selling a home with a real estate agent can be challenging and time-consuming. An as-is sale may be the right situation for you if one or more of the following conditions apply.
You’re getting divorced
A difficult divorce may cause you to miss mortgage payments. There may be a disagreement about who is responsible for the mortgage, and that can get messy.
An as-is sale may be a relief during the tough legal battle. It can help relieve you of the hassle of keeping up with your mortgage. Also, it can make dividing the marital assets a little simpler; instead of co-owning the home, you can split the cash from an as-is sale.
Your home is close to foreclosure
Foreclosure can be a scary event. It’s better to recapture a portion of your investment rather than lose it all. Despite the feeling of helplessness you may feel, it’s helpful to remember you own your home and can sell it until the court officially forecloses.
You’ll attract a cash buyer unencumbered by securing a loan in many as-is transactions. The speed of the transaction may be an ideal solution for you to avoid foreclosure.
Your home needs major repairs
Your home may need significant repairs like a problematic electrical issue, faulty foundation, or suspect plumbing.
If you’ve come into possession of a hoarder’s home and don’t want to spend time and money repairing it, selling as-is might be your best choice.
In a regular home sale, you must fix any issues or agree to contingencies before finding a buyer, which can be costly. While the sale price may be lower than in a traditional sale, it may be more affordable than paying for major repairs.
You need to act quickly
If you cannot keep up with the expenses of an inherited home, need to relocate for a new job, or desire a quick and clean slate, then selling your property as-is might be the answer to your troubles.
As-is sales close in days because they are:
- All cash with no lenders involved
- Inspection free
- Free from cleaning, repairs, or renovations
You want to avoid the expense of a traditional sale
When you sell a home, the real estate agent fee can be as high as 6% of the sale price. Additionally, you will be responsible for paying for other costs, including the following:
- Closing costs
- Cleaning costs
- Repairs and renovations
- Home inspections
- Staging
- Seller contingencies
The costs are hard enough, but you’ll also be at the mercy of your potential buyer’s schedule. You’ll need to keep the house in pristine condition and be ready to vacate the premises for a showing.
What to Know When Selling Your House As-Is
The amount of money you receive when selling a house as is depends on several factors. The price difference usually depends on the type of buyer you sell to: a home buyer or a real estate investor.
Buyers who want to be homeowners
When a buyer is interested in becoming a homeowner and comes across an “as-is” listing, they might be hesitant and skeptical. They could think that you need to disclose important details or that the listing pictures and showing are inaccurate.
For homebuyers, the possibility of major issues arising in the future is a significant concern. They may worry that a minor foundation problem could lead to sagging walls, while issues like a collapsed roof or leaky pipes could cause difficulties come winter.
Potential buyers may anticipate a reduced price if they perceive the house as a property needing major repairs.
Buyers who are cash investors
Cash buyers have their methods of determining a property’s worth and deciding on an appropriate offer.
The strategy determines the offer. An investor who wishes to purchase a home to rent it out may have to pay a higher price. A house flipper may make a lower offer.
One huge benefit of selling as-is to a cash buyer is that they typically pay all closing costs. Selling to a cash buyer could result in more profit as you won’t have to pay agent commissions, cleaning, or repair fees.
How to Sell Your House As-Is
Whether you sell the house to a cash buyer or with a real estate agent, here are the steps you should follow.
Step 1: Disclose material facts
You have to be upfront about the issues with your house that affect the home’s value. If you do not disclose, you may run afoul of mandatory disclosure laws. That can put you in legal jeopardy.
Step 2: Be clear that your home is selling as-is
Ensure your buyer knows you are selling your home without making any repairs or renovations. Otherwise, they may think that the sale is traditional. As a result, they may expect to negotiate prices and contingencies.
Step 3: Consider a cash buyer
A cash buyer in real estate understands that as-is homes may have problems and is usually not deterred by those issues.
Maybe your home needs major repairs, or you need to move quickly for a career change. Time is critical; a cash offer can immediately take a problem house off your hands.
Cash buyers usually want to buy off the housing market, so you’ll have to reach out to them. Cash buyers have advantages, including the ability to:
- Fair price
- Skip repairs
- Sell on your timeline
- Close with certainty
Step 4: Sell your home traditionally
Sell your home on the open market. If you have the know-how, you can sell the house independently (For Sale By Owner, FSBO) or with a real estate agent. Here are some things to keep in mind when selling your home:
- Decide on your lowest acceptable offer and avoid accepting lowball offers
- Repairing high-priority home improvements like:
- Electrical panel
- Foundation issues
- HVAC
- Plumbing issues
- Roof
- Termites
- Water damage and mold
- Tackle easy cosmetic problems with low repair costs such as:
- Cleaning and decluttering
- Curb appeal
- Light
- Landscaping
- Painting
- Get a pre-listing inspection to get ahead of potential issues
Conclusion
Selling your home “as-is” can be suitable for those who prioritize speed, ease, and cost-effectiveness. The list price for your home will reflect its current condition, which may be in disrepair and lower than that of a fully renovated home.
It is vital to communicate to potential buyers that you are selling the home as-is. Cash buyers may be a favorable choice for those selling a home that requires significant repairs.
