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The hidden cost of guaranteed offers and cash offers

Guaranteed Offer
Cash for your home. No Headache?

On a recent road trip from Orlando to South Carolina I must have counted no fewer than 50 billboards on the highways promising a cash offer on properties — NO INSPECTION — NO COMMISSION — NO HEADACHE — NO HASSLE — AND, YOU GET TO PICK YOUR OWN CLOSING DATE.

  • We buy homes in as-is condition
  • We buy “ugly” and “pretty” houses
  • We pay ALL cash & beat ALL other offers
  • We buy houses you don’t want
  • We buy homes in all situations and conditions
  • We buy damaged homes from fire, flood, mold, & more
  • Are you relocating and need to sell fast?
  • Don’t want to deal with real estate agents?
  • The most competitive all-cash offer in the industry
  • Get a Guaranteed Offer and work with trusted home investors so you can close with confidence!

WOW! ….So who are these people?

Well, guaranteed cash offers have been around for almost a century. In recent years their popularity increased due to internet, social media, and low cost of postcard mailings. The actual buyers include private investors who buy one to a few fixer uppers, renovate, and resell for profit.

Others are institutional buyers who will buy and have a team of contractors waiting to turn your “ugly” house into a beautiful mansion in 5-21 days.

What the guaranteed offer buyers don’t tell you is that the offers they make is never at fair open market value. Notice here the term “fair open market” vs. just fair market. Anybody can make a fair market offer on a house when they are the only one making the offer. And while all claim to make offers that will bring you the most money, none will actually deliver the guarantee — in particular, if the property is outdated, distress, or beaten below market condition.

Many have investor relations or partners ( the money man ) who will offer a line of credit to buy for fix up, immediate resale or for renting. In all my days ( almost 30 years ) in the real estate business I’ve not actually seen anyone or any program that is actually “GUARANTEED CASH” where the buyer comes to closing with CASH. So guaranteed cash is really a hook than a payment method for real estate.

To repeat a Guaranteed Cash Offer is actually not a CASH OFFER at all.

So “CASH BUYER” is truly a term of art in the real estate business that is as synonymous as saying you will pay cash using your bank credit or debit card. A promise of a guaranteed cash offer is designed to excite the homeowner and gets the salesperson in the door for a listing appointment or to make a discount offer.

Others will promote a cash offer, SUBJECT-to them paying off the existing financing on the current home. For those in a distress situation, divorce, or need to sell quickly, signing away a home for $1000 to stop further deterioration of credit scores or finance is compelling but not really and in fact — far from a cash offer.

The bottom line is a CASH OFFER or GUARANTEE OFFER gets homeowners calling. They call the salesperson instead of the salesperson calling them.

The other kind of cash buyers or guaranteed cash buyers are institutional buyers. These buyers can be a lender, bank, or a publicly-traded company with access to billion$ to make cash offers at significant discounts. Some of the programs they offer can be enticing and compelling to the impatient homeowner to buy their new home even while the existing house is listed by a real estate agent, or with the option to delay selling the existing home for up to one year. A number of these outfits will allow the homeowner to take equity out of the existing home for down payment on a new home, or to fix up the current home for resale.

A few of them, for the right price, will buy “CASH” below market and pay any profit they make back to you.

When it comes to a CASH buyer or GUARANTEED CASH buyer the actual buyer could be a private buyer, investor, or a marketing hook for you to call for a listing appointment.

But here’s what CASH BUYERS or GUARANTEED OFFERS won’t tell you…..

— The offer is often 10-20% below market

— A cash offer might mean giving you $1000 so you will sign away your house ( problems ) to them

— Every cash buyer will require you to fill out one request form ( imagine doing this 10 times? )

— Every cash buyer will require an inspection ( imagine 10 inspections? )

— After inspection, almost all will come back to you for more discount ( think 5-10% more ? )

— All will promise a fast closing ( but actual # days usually 20-45 days )

— Virtually every cash buyer or guaranteed offer will end up relisting your house with a local real estate agent.

So, while the promise to sell for cash might sound compelling, it is often best to compare all the offers in realtime.

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US Supreme Court Opens Door For Guaranteed Highest Offer

If ever in the history of the real estate industry where millions of real estate professionals have been in a complete disarray about the future of home selling it would be this week.

Two days ago the U.S. Supreme Court denied a special request by the National Association Of Realtor to end future litigations against the organization regarding commission cooperation between competing agents and what agents know as the CLEAR COOPERATION RULE which mandates that Realtors make all new listings available in the MLS within one business day of advertising to the public.

For the general public this might appear as “nothing new” but to those highly experienced in the real estate business is a message to the industry that “commission sharing” between competing agents whether on or off the MLS is a restraint on competition. The U.S. Department of Justice has expressed through its Civil Investigative Demands that the Realtor organization has not been released from future lawsuits from the regulatory agency. And — the U.S. Supreme Court has notarized.

While change is difficult and costly to legacy business models it is necessary to welcome change for the benefit of the consumers. At Homeselling AI we believe Guaranteed Highest Offer can bring the most benefits for millions of homeowners through the power of real-time transparency.

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10 buyers in 2 days vs. 10 buyers in 30 days

Over twenty years ago the founder of Homeselling AI, Mr. Kosol Sek, stumbled across the biggest secret in the real estate industry; that is — It was possible to generate over 420 buyers for a home in exactly 12 days.

However, with this amazing discovery came the challenges in handling 420 buyers simultaneously. How could any human being handle 420 buyers all at once? In fact– how could any human being handle 2-4 buyers at the same time without increasing the chances of late, lost, or uncommunicated offers?

Over the next several years Mr. Sek and his team of 300 professional home sellers across the United States went on to develop a systematic process which subsequently became a scientific selling process for guaranteed highest offer for properties.

This journey marked the beginning of what millions of homeowners everywhere will know as Homeselling AI.

Homeselling AI was not intended to replace real estate professionals but to help manage tasks and activities that have been proven to be humanly impossible to achieve.