Before you sell your house to a real estate investor (companies that post we buy houses signs) it is important to take a step back and make sure you’re prepared for what happens next.
Many people look to sell their houses fast to avoid a bad situation like foreclosure where you lose everything, medical and credit card debt piling up, or because they’re going through a divorce and want to be done with the headaches. Other times it is because of time sensitive needs like moving for a job, or inheriting a house and not wanting to deal with taxes or a mortgage. No matter what the reason is, you want to be prepared.
Here are a few questions to ask yourself before you sell your house quickly, and the reasons why they matter.
- Where will you live?
- How can you prevent the same situation from happening again?
- What debts are still owed?
- Have you closed all accounts and covered all bases?
Where Will You Live?
The most important question to ask when selling your house fast is where you will live next. Yes, you’ll have cash in your pocket to do what you want with, but you’ll also need somewhere to live. Make sure the company you’re selling to allows you to have time to find a new home, and if you need money, they give you a cash advance to help with moving and putting a deposit on your new home.
If they’re in a rush to get you out the door, they don’t have your best interest in mind. Good house buyers will help you by providing solutions and walking you through what happens after you sell. You can also ask for testimonials from recent sellers whose houses they purchased. Getting testimonials and referrals is a good litmus test to see if the home buyers are legit or a scam.
How Can I Prevent the Same Situation?
It’s important to document how you ended up in your current situation so you can build a plan to prevent it from happening again. If it was inheriting a house, have medical debt piling up, or you’re moving for work, there’s nothing you can do about that. If you need to sell your house fast because of credit card debt, not keeping the property up, you have have liens, or there are repairs you delayed that lead to infestations and damage; having a plan for preventing the issue from happening again is vital.
Start by talking to a financial advisor or debt coach. You may not like what they say, but if you don’t take steps to prevent being in your situation, you’re going to wind up in the same spot or worse. Having a professional to guide you to a better future is key here.
Many times your local government has a department with professional consultants dedicated to helping people avoid the same financial mistakes. They offer the service free and there’s nothing to be embarrassed about when calling. It happens to all of us, and taking this step helps set you up for a better life.
Do I Have Outstanding Debts?
Debts don’t just go away because you sold your home. And outstanding debts can keep your credit score low if they’re not being paid back, and the payments are not being reported to the credit bureaus. If you choose not to talk to a financial advisor or debt consultant, which we recommend you do, think about the money you have once you sell.
- How much of a deposit and first or second month’s rent will you need?
- What is your actual cost of living minus luxuries and frivolous items like fancy coffee?
- Which debts will make your life worse off?
- Utilities that are needed for survival.
- Phone bills if you need to make calls for work, or to check on loved ones.
- Credit cards so you have wiggle room in case of emergencies.
Divide up the amount of money you have and begin applying it to necessities, not wants. Now take some of the remaining money and put it into savings for groceries, emergencies like medicine, and use the rest wisely. You no longer have a home to sell, so that asset is gone. If you don’t plan your budget wisely, you will be worse off. This is why talking to a professional you trust and following their advice will likely be helpful.
Are All Accounts Closed and Out of My Name?
The last thing to make sure you do is close all accounts out of your name. If you don’t, the property may have lights on or water dripping which runs up utility debts in your name. The same goes for property taxes which you will still owe if the deed is not recorded at the county clerks office, and think about cable tv and luxury expenses. If you don’t close the accounts, you could wind up with larger debts. This step may be tedious, but it is necessary.
Lots of people sell their houses because of finances, job loss or moving for work, or because they need to downsize because they’re retired and moving into assisted living. No matter what your reason is, make sure you’re prepared. The questions above will help you get prepared, and if you want more information, call one of our home buying specialists at . They help people just like you every day.