Selling your home can be daunting and gut-wrenching especially if you have to repaint it, trim the lawn to boost the curb appeal and replace the cabinets in your embarrassingly old kitchen, and much more. However, there are those who are always moaning, “There must be an easier way to sell my home,” you are fortunate because you can learn the steps to sell my house as is. So what exactly is an as-is home? This is a kind of home where instead of investing a lot of money and time upgrading your home, the seller does nothing and just puts the home out there for sale with the hope that someone will have some pity and buy it as it is. Obviously, there are numerous reasons why a seller would choose this avenue: They probably inherited an old cottage and are looking to sell it fast, or maybe the house requires a lot of remodeling but they cannot stand the idea of spending their days in a construction zone. Or probably, they are just the lazy type.
Whatever the reason could be, selling your home as is isn’t as easy as it sounds at the first blush. There is a lot that you must know about the process and all the pitfalls so that you can establish whether it is the right move for you and ultimately pave a smooth sale. You’re probably wondering, how can I sell my house as is? Here is what you should know about the process.
When you are listing your home for sale, it is important that you make it clear that you are going to sell it just as it is, without any upgrades or remodeling. Besides serving as a beacon for the bargain hunters, this kind of listing helps weed out the buyers who are not interested in an upgraded home not waste your time with endless quotes. Since “as is” homes will compel the buyer to spend more money and time making the necessary upgrades, your listing price must also reflect and cater for that. For example, if your roof is completely outdated and it would require $10,000 to replace and your embarrassingly outdated and overdue for a $20,000 upgrade, you should knock $30,000 off the normal asking price for a home of a similar size in your neighborhood.
Step 2: What Should You Disclose in an as is Home?
Selling your home as is doesn’t relieve you from revealing known defects in the event that you receive an offer, in fact, it is a legal requirement that you do so. In this case, the term “known” is crucial. If you inherited a home from your parents, you might not be in a position to know about its general state and as a result, you could be exempted from giving a property disclosure. However, if you willingly or intentionally disclose known information about some issues, the buyer has a legal recourse afterward should there be any problems.
However, you do not have to worry because you are not completely entitled to point out every drafty window or crack in the wall. The flaws must be bigger than just a mere crack on the wall, such as sinkholes or lead paint. Besides, the required disclosures tend to vary from one state to the other so inquire from your Realtor what you need to disclose in your area. In some states, for instance, you are required to reveal whether someone has died in the house whereas in other states it is not a necessity.
Step 3: Shall the Buyers Inspect an As-Is Home?
When selling a home as is, it means that you as the seller are not entitled to perform any repair works. However, the buyer might still want to perform some due diligence by carrying out a home inspection to see what shape the home is in. If the inspection reveals something bad, the chances are that your buyer will just walk away from the deal. What’s even worse is that if the buyer walks away from the home because of issues uncovered during the inspection, in most states, it is a requirement that you share the information with future buyers.
It is also important to note that while “as is” is crucial in stating all your intentions, it does not imply that your buyer will not request for compensation or repairs after performing the inspection.
Step 4: How Do Lenders Handle as in homes
If the buyer will be receiving a mortgage, the lender may demand that another contingency is included in the agreement called a home appraisal. This is to make sure that the money the lender is giving out is not going toward a lemon. In fact, a lender will only dole out the amount of money that they feel the house is worth �" so if your appraiser feels that the house is worth less than what the buyer intended to pay, that could be some bad news. This means that the buyer will have to cater for the balance or that the lender will require you to make the necessary repairs before selling the home. And if you refuse to adhere to that, the buyer will just walk away from your deal.
Reasons to and not to Sell My House As Is
If you’re planning on selling your home, you’re probably wondering, “What pros and cons will I incur when I sell my house as is?” Before deciding to sell your home as is, you must be conversant with what selling as is entails. There are some advantages and downsides to selling your home as is. So, what under what situations is selling your home as is suitable? Here are some of them.
1. You can’t afford the cost of repairs’
You could probably be in a financial situation where any kind of repairs on your home could not be feasible. If your property is filled with defects and there is no way to repair the defects, you do not have an option rather than sell it as is. However, it is advisable that the seller keeps an open mind and consult a realtor before deciding to sell their home as is. The realtor could come up with some creative ideas this will prevent you from selling your home as it or at least prevent you from listing it as property for sale right from the start.
2. You Cannot Deal With The Stress of Home Sale
At times, a homeowner will find himself in a situation where he must sell his home but is not in a position to handle the stress that the home resale process entails. If the homeowner is seriously ill or incapacitated, dealing with the selling process could be a nightmare and a homeowner would decide to sell their home as is because it would be the most sensible idea. Again, it is advisable that you explore all options before deciding to sell your home as is. You could inquire from family, friends or a realtor so that you are better poised to deal with the stress of selling your home.
3. Financial Distress
Sometimes, the homeowner will find himself in serious financial distress and must sell his home instantly in as is condition. The best option is such a scenario us to get in touch with an investment company since they are perfect for distressed sellers who need to make an immediate sale.
The Problems of Selling As Is
Although there is a negative connotation with purchasing a home as is, there are also potential problems of selling a home as is. Here are the disadvantages of selling your home as is.
1. Negative Perception from Buyers
If you’re selling your home as is, it is pretty much obvious that almost all buyers will have a negative perception of your home. They may be willing to buy the home but when they see the “as is” tag, they will easily assume that something is wrong with your property �" something that is too serious for you to fix.
2. A Buyer Will Low Ball You
Unlike in a completely refurbished house where you as the seller calls all the shots, the case is different for an as-is sale. In such an instance, the buyers approach you with the assumption that your home has many serious defects and will bargain with you and even dictate their buying price. In such an instance, it not a surprise to receive offers that are less than what you wanted or the actual value of your home.
3. You Attract Fewer Buyers
Since your listing is clear that you are selling your home as is, the chances are that you will drive away many prospective buyers. Even when you’re in a position where you just want to put little money or effort in your home to make the sale, you could benefit more by avoiding the as in tag in the listing. Just let the buyers come and give their offers, consider your options then go ahead to turn down any request to perform repairs if you feel it is the right thing to do.