How to get an instant cash offer for your house

Many of us value speed and convenience, from takeout food to on-demand streaming. The same can be said for a lot of today’s home sellers, who are looking to move quickly and without the hassle of preparing and listing their residence in the traditional ways.

Enter iBuyers, companies that can provide an instant cash offer and a faster, smoother transaction — all almost entirely online. If you’re in the market to sell your home, here’s how to snag an instant home offer, and the pros and cons to consider.

What is an instant home offer?

An instant home offer, often known as iBuying (the “i” is for “instant”), is a cash offer from a company to purchase your home. These companies use proprietary algorithms and public data to formulate an offer price and can make offers quickly, frequently within 24 hours. However, while selling this way is fast, it’s also frugal — your instant offer will very likely be lower than the price you’d get if you sold on the open market. After all, most iBuyers are home-flippers, and they have to account for the costs of making repairs so they can earn a profit on the transaction.

“We’ve always had cash buyers and property sharks willing to contract and close quickly at a discount to make a profit,” says Bruce Ailion, an Atlanta-based attorney and real estate agent with RE/MAX Town & Country. “The difference here is that iBuyers typically originate online and cater to buyers who prefer convenience. But their goal remains the same: Purchase below market value and sell for a profit.”

There are other types of companies that buy houses, too, including HomeVestors and the aptly named We Buy Houses. Most also make cash offers and can close the transaction much faster than a traditional sale — and, like iBuyers, most will offer substantially less than you’d be able to make otherwise.

What kind of sellers are instant offers best for?

The best candidates for these offers are sellers who:

• Want to move quickly
• Are under financial pressure and need the cash infusion fast
• Plan to sell their home in “as-is” condition

“An instant home offer is especially attractive to sellers who need to move due to a job relocation, struggle with an illness, are experiencing financial difficulty, have a fixer-upper-type property that they can’t afford to repair, or need funds and a fast sale to purchase their next home,” Ailion says.

Beyond a fast closing, an instant cash offer for a house can be appealing because there’s no need to open up your home to strangers for showings or open houses. In fact, iBuying had a bit of a heyday during the height of the pandemic partially for this reason. These transactions also typically do not require a real estate agent.

How to get an instant cash offer for your house

If this sounds like a good route for you, it’s important to understand how the process works. Unlike the traditional process of listing your home and waiting for prospective buyers to come to you, getting an instant offer on a home simply requires requesting one. Here are four easy steps to follow.

1. Shop around

First, do your homework: Research whether the homebuying companies you’re considering are reputable by looking at online reviews and Better Business Bureau ratings. If you’re looking into a large, national company, be sure to look at your local branch specifically, as franchises are typically independently owned.

2. Request an instant home offer

Once you’ve narrowed down your list, you can request offers from a few companies to see who can make you the best preliminary offer. Look closely at whether there are any associated service fees, and if so, how much they are. Requesting an offer should not cost you any money, and you’re not under any obligation to accept.

To ask for an offer, you’ll typically either enter some basic information about your home online or provide the info over the phone. You’ll get a preliminary offer quickly, usually within 24 or 48 hours. In some cases, you may be asked to upload photos or videos of the home as well.

3. Receive and review your final offer

Most companies will want to send a representative to evaluate the home in person next, and their preliminary offer may change after their evaluation. If you like the final offer, be sure to review all the paperwork carefully so you understand it fully. A real estate attorney can be a valuable resource here — but don’t spend too much time contemplating, because these offers typically expire quickly.

Pay special attention to what fees you might have to pay. Many cash-homebuying companies cover all fees for you, including closing costs, but iBuyers can charge steep service fees that may cost about the same or even more than what you’d pay in agent fees in a traditional sale.

One more thing to be aware of: Cash-homebuyers typically do not negotiate on price. You don’t have to accept their offer, but you likely can’t haggle to see if you can get more.

4. Pick a date to close the deal

If you accept the offer, you’ll usually have the option of choosing a closing date that’s convenient for you. Because the companies are paying in full, with no need for financing or lenders, some can close in as few as seven days. Many are also willing to be flexible for a few months if you need more time to move out.

Instant cash offer pros and cons

There are advantages to accepting an instant cash offer for your house, but the major downside — earning a smaller profit — can considerably outweigh the benefits.

Pros

• Fast process
• Choose your own closing date
• No financing, so low to no risk of deal falling through
• No need to prepare the property for sale or let buyers tour it
• Typically no appraisal requirement

Cons

• Lower sale price, often below fair market value
• Potentially high service fees
• Not all areas are served by iBuyers

Should you accept an instant home offer?

Depending on your circumstances, selling to a cash-homebuyer can be worthwhile — especially if you need to move quickly or if getting that cash ASAP is top priority. However, if you have more time, you will almost certainly make more money in a traditional sale with an experienced local real estate agent by your side.

Bottom line

Since your home is likely your largest, most valuable asset — and a huge part of your net worth — it’s well worth at least exploring listing it with a real estate agent. But an iBuyer is definitely something to consider if you’re particularly pressed for time or cash.

“A traditional sale is well worth the effort,” Ailion says. “But there are some circumstances where a home is uniquely disadvantaged or difficult to value, in which case selling to an iBuyer may be preferred.”

FAQs

• Are companies that make cash offers for your home legitimate?

• What type of companies provide instant home offers?

• Do I still pay an agent and closing cost fees with an instant home offer?