Are you searching for a company to buy your home? Are you concerned with finding a Legitimate Homebuying Company in Metro Detroit? It’s a common concern. I’ve put together this post to address the questions I get asked most often about how to weed out the folks you probably don’t want to work with. I hope it’s helpful.
As you’ve been searching the web for a company to buy your home, you can’t help but to have noticed that there are a couple of hundred We Buy Houses “companies” in the area screaming for you to call them.
And the crazy thing is, pretty much ALL of them are claiming to be “The LEADING” or “The #1”, or my favorite “the PREMIER” We Buy Houses company here in Metro Detroit.
It’s all a bunch of crap. If you pardon my French. 🙂
The fact is, there are only a small handful of credible companies here in the area that legitimately buy houses. I can count them on one hand. Yes the number is THAT small.
The rest are underfunded newbies and a lot of folks who recently attended a weekend seminar given by a some national real estate guru who made real estate investing sound cool, fun, and of course, easy.
The challenge for you then, is how do you sort through this mass of marketing hype and find someone who can actually solve your problem?
The good news is that it’s pretty simple. There are a few things you need to do to weed out the pretenders. They are:
1. Demand an EMD
EMD is shorthand for Earnest Money Deposit. It’s a good faith, non refundable deposit that legitimate buyers make to show the seller they’re serious about closing on the purchase.
It protects the seller (you) from the buyer simply walking away from the purchase agreement. Because if the buyer walks, and they often do, the you get to keep the EMD as compensation. It’s standard operating procedure when buying and selling real estate.
When investors buy properties they typically pay anywhere between $1,000 and $5,000 as an EMD. The pretenders though don’t have the money to make EMDs so their most common tactic is to brush if off and try to tell you it’s not necessary. Then when you press them for it they’ll offer something ridiculous like $100. Yes I have seen that happen more times than I can count. Don’t fall for it.
So the best way to eliminate the pretenders is to require an EMD.
2. Demand POF
POF is shorthand for Proof of Funds. This is simply documented proof from a bank or other financial institution that shows that the buyer has, in their name, the funds necessary to buy your home.
It’s not unreasonable at all to require proof of funds before you agree to sell. This is another great way to eliminate the pretenders, because if they don’t have the money to use for an EMD, they won’t have the money to actually buy your property. Beware of fake POF documents though. If you don’t recognize the financial institution, or if the account isn’t in the buyer’s name, call to verify funds.
3. High Pressure Sales Tactics
This is rampant these days due to all the competition amongst real estate investors. The way this works is that when you’re calling around talking to investors about your house, some will push hard to be the first one to see the house. That’s the first warning sign. Because once they’re in your house they’ll brutally browbeat you to sign their offer BEFORE you meet with anyone else.
How is that in your best interest? It’s not of course, because these folks typically offer below what others will offer, which is why they will push to get in first to meet with you. So don’t ever sign a purchase agreement until you’ve talked to at least two of us.
4. Making Offers Far Above Other What Others Offer
This is a situation that’s also happening far too often these days. I was working with a probate seller three months ago. He was doing the right thing and fielding offers from 4-5 investors on an estate home he was selling in a pretty good area.
It turns out that as usual, four out of the five offers were within a couple of thousand dollars of each other. That’s what’s supposed to happen when you talk to multiple people.
But the fifth investor came in and offered 20% MORE than the rest of us. Although that should have been a red flag for the seller, the seller was giddy about the offer and informed the rest of us that he was taking the higher offer.
He needed to get court approval on the sale and I kept in touch with him through the process. The sale was finally several weeks ago and guess what? The buyer disappeared and didn’t return the seller’s calls. Oh and the seller decided NOT to demand an EMD because the buyer talked him out of it.
So the seller called me in a panic looking for help since he needed the sale proceeds pretty much immediately to pay off a past due property tax bill on the house. We met him at the house and resubmitted our original offer. He swallowed hard and accepted it, and and we closed the following week.
Remember that the old saying is true – if it sounds too good to be true, it is.
Selling a home to an investor really is easy – if you work with someone with a proven track record.
I’ve been in this business buying and selling homes since 2004. I’ve worked with folks all over the Metro Detroit area in all sorts of situations. I’ve waited eight months to close on one property because the seller was waiting for an opening in an assisted living center, and we closed on another one in four days because the seller was going to forfeit the property for taxes.
We know the area. We live here. We work here. And we’re raising our families here. And we’re not going anywhere.
So if you are in a situation where you can’t or don’t want to list your home with an agent, then give me a call.
I answer my own phone and I’m a good listener.
Also I promise – No lowball offers. No sales pitch. And NO hard sell.
Give me a call at (313) 246-4551 or get started by filling out the form below.