Properties bought for cash - avoid repossession with a quick cash sale

There are now many companies offering a service to buy your property quickly for cash. Whilst some have been around for many years the vast majority have formed in recent years to help home owners who, for what-ever-reason, find themselves needing a quick cash sale as they are unable to maintain the mortgage on their home.

Having a property bought for cash provides a perfect and needy solution for many home owners every week. Having the cash available for a quick purchase means they aren't tied by the usual constraints of the mortgage application process.

If you ever find yourself in a position where you are struggling to keep up the repayments on loans secured on your property it can have devastating consequences:

  • The property can be repossessed and you can be evicted from your home.
  • The bank/building society could sell the property at a price less than you owe them. They will then come to you for the difference. This is one of the worst aspects of losing your home - the fact that you may not, financially, be able to put it all behind you.
  • One thing to consider is that many auction sales are indeed properties bought for cash by investors - so why not sell direct and avoid repossession in the first place.
  • Your Credit History will be badly damaged, making it much more difficult to obtain even small amounts of credit at a reasonable interest rate.

One thing that is sometimes overlooked is secondary loans secured on your property. All home owners will understand that if they don't keep up their mortgage payments they could ultimately face eviction. So if someone is struggling to pay their monthly bills they will tend to make sure the mortgage is paid first. However, if you have taken out a secured loan then the risk is just as great. It may only have been a few thousand pounds to pay for a new kitchen etc but if it was secured on your property (a second charge) and you fail to meet the payments then that company could also apply for repossession of your property.

If this were to happen then your primary mortgage company (the one who lent you the money to buy the property) will have their loan settled first as they have the first charge over your property (ie the first right to any monies from the sale). The secured loan company will then take what they are owed from the remaining money. Once again, if there isn't enough to pay off the secured loan then the secured loan company will pursue you for the difference.

Companies that buy property for cash

Listed below are companies that offer a quick cash sale for your property. There is one recommendation per county - please follow the link to their website and contact them direct:

Greater Manchester:

Quick property sale Manchester

Lancashire:

Quick cash sale Lancashire

Leicestershire:

Quick cash sale Leicestershire

Quick cash sale

So if you find yourself in a situation where you could lose your home then a quick cash sale could be the solution and hopefully allow you to settle all your debts from the proceeds. You would lose your home but, if you settled all your debts you would be able to make a fresh start.

If you choose this route and have the time to sell your home on the open market then this is undoubtedly the way to go. Any company buying your property for cash is doing it as a business and will not therefore offer you the full market value. If you can afford the time required then selling your property through an estate agent should in almost all cases get you a better price. But this can easily take three months or more, from putting your property on the market to the sale completing.

If that is too long to wait then the property buying companies can buy your property for cash in around one to four weeks. They will have their own survey completed within a few days and will then make you a firm offer for a quick cash sale. If you accept then they will usually agree to pay all your expenses (such as your solicitors fees) and you could complete within a couple of weeks.

Why will I be offered less if my property is bought for cash?

As stated above, any company that buys your property quickly and for cash is providing you with a service and will be looking to make money from that service. If they chose to sell the property themselves they would have to absorb two sets of fees (buying from you and selling to the new owner) and they could well have met all YOUR expenses as well. On top of covering all these fees they will want to have a profit left at the end of the two transactions.

You should also consider the expenses you would face if it took you three or more months to sell your propety through an estate agent:

  • Three or more months mortgage payments.
  • Estate agent fees of about 1.5% + VAT.
  • Most people offer less than the asking price. If you want to sell as soon as possible you could easily accept an offer 5% below the asking price.
  • You will have to pay your own solicitors fees.

So if you do consider having your property bought for cash then please take the time to weigh up all the variables. The cash offer will never be what you would like but, when you weigh it up against the costs of a traditional sale and your own personal circumstances and immediate needs it may be a viable solution.

Sell and rent back

Some companies that buy properties for cash operate a scheme where they will buy your property and then rent it back to you. This can be an ideal solution as you can continue to live in the place you call home, albeit as a tenant rather than owner. In such circumstances no-one need ever know there had been a change of ownership. You would avoid the need to find a new home and ideally settle all your outstanding debts from the sale proceeds. Some companies will also offer a means to buy back the property when you are in a position to do so.

Seek advice

As with all financial decisions you should always seek independent and unbiased advice in the first instance. Your local Citizens Advice centre will be able to refer you to organisations that can advise on your financial problems and suggest solutions. If you have an IFA then discuss your situation with them as they may be able to offer a solution.