Types of house buying company to sell your home

As the seller, it is always a good idea for considering every option, depending upon your needs and priorities. This option-weighing procedure incorporates who to sell the house to & what they can provide when it comes to terms, peace of mind, and price. The market of real estate is made up of buyers and sellers each looking for the most suitable deal. However, a few buyers in the mix are often not individual people at all. Rather, they are the house buying company. These companies, according to the business model, buy houses for some sort of profit. 

Beyond the basic back-&-forth negotiations as well as purchasers’ fickleness, there are uncountable hurdles in the home buying procedure which can drag out the deal or even derail it completely. You are intrigued by the notion that the home buying company would buy the home tomorrow, however, actually, a bit skeptical of what their intentions are & whether or not you would be glad about the result. This guide to home buying companies is meant for giving you the much-needed clarity for making a well-informed decision regarding selling your house. 

So, firstly, let’s see the house buying company types to which you can sell your house – 

1.  iBuyers –

The iBuyer is the business that utilized the market data of real estate as well as its technology for making instant offers on sight-unseen, houses, after being reached out by the owner. Today, a few of the best-known instances of iBuyers involved in the first time home-buying procedure are Zillow, Opendoor, and Redfin. While the house flippers often look for houses that require work, the iBuyers are typically more aimed at those properties which are in quite a good shape as compared to the other properties selling in the market. The iBuyers are often free-based, implying that they make the offers that are closer to the house’s real market value, however, will then charge the fee (nearly 6%-7%, as per the location). 

This fee is for handling the marketing, sale, and purchase of the property. Once the offer gets accepted, the iBuyer will send out the representative for inspecting the house’s condition to smoothen the property management process. In case any repairs are required for bringing the home to market condition, they will possibly request the credit at closing for the required repairs. Currently, iBuyers function primarily in bigger metropolitan areas, so they might not be an alternative in rural areas or smaller cities. 

2.   Trade-in Companies –

There are distinct ranges of what is called the house trade-in business model. A few trade-in companies will offer you to purchase a new house on a homeowner’s behalf, utilizing the current home of the owner as collateral. At times, these firms will allow the house owner to rent the new house until the old one sells so that there is no issue in terms of property management. Some instances of the latest top home trade-in companies are Ribbon and Knock etc. Some Companies’ trade-in program is special in that they will work with the real estate agent for making the offer on your existing house, and guarantee it. 

trade-in comoanies

They purchase your house at the guaranteed rate so you avail the cash for closing on your dream house & control when you get to move. Then, they work with the agent for listing your previous house. In case your house sells for way more than the price the Company has paid for it, they offer you the extra cash excluding program fees and selling rates. Please note that the above-mentioned special trade-in program into the real estate market is right now available in a few countries only. 

3.  Buy-&-hold Companies –

They buy homes with the intent to rent them to the tenants in exchange for profit. Just like the flippers, they will look for acquiring properties that offer sufficient possible cash flow or equity that they can make the acceptable ROI for their stakeholders or owners. A few buy-&-hold investors are smaller, mom-&-pop operations that do their property management & repairs for saving bucks. The 2 major US firms i.e., American Homes 4 Rent and Invitation Homes, might have the in-house teams for managing several facets of the business & might have sizable overhead. 

buy-and-hold companies

A majority of these investor types in real estate marketing utilize the model “BRRRR” which means “Buy, Rehab, Refab, Refinance, & Repeat”. This is because they tend to aim at multi-family buildings along with other kinds of rental properties, you can find the buy-&-hold investors in almost any city. 

4.  Home flippers

These buyer types buy properties with the intent to renovate or remodel for adding value, then resell the properties immediately for a profit. Home flippers look for where particular modifications, like mechanical repairs, cosmetic upgrades, change to its layout, or addition would quickly enhance the equity. The home would require to be bought by the flipper at a rate that permits for the 15%-20% profit margin, as per the project’s size. 

Most of the mid-sized metro areas and every major city have various home-flipping businesses, and you will also get a few lower-volume businesses in smaller towns and cities. The best-known US company for home flippers is HomeVestors (otherwise called the “We Buy Ugly Houses” Company) that has franchises throughout the country. 

5. Agent as the deal-maker –

At a first glance, it may look like the seller would opt for the home-buying Company as the means to avoid the commission fees of the real estate agent. However, as these kinds of Companies evolve in popularity, several realtors prefer to work with them as the means to get instant sales for the clients. So, always pick the one that has worked with various property investment companies in the local market. He/she should be an experienced one along with having a proven track record of satisfied clients. For these real estate agents, the only challenging aspect of working with smaller house-buying Companies is that there are, at times, title hang-ups. 

As they pick their title firms, the procedure can be a bit tiring, however, it is still quicker than the conventional sale. In the long run, the real estate agent collaborating with home-buying Companies offers you several benefits, such as extended move-out dates and quick closings. Now, this makes it a worthwhile trade-off. The property investment firms can be the best choice for those sellers who don’t have much experience or knowledge in gauging out their homes’ value. 

However, it is still a good idea to work with a real estate agent who can examine the offers & alert the seller to the red flags. Precisely put, in case the house buyer is unwilling to put something in writing, makes the limited-time offer, pushes for the sign, or utilizes any other approaches which put pressure on the seller, those are the signs that it might not be the legitimate company. 

home for sale

Now, let’s discuss the benefits of utilizing the home buying Company-

1. It is safe – Once you have accepted the formal offer, the sale price gets secured without any last-minute surprises. Now, it assures that you are incapable hands. 

2. It is Flexible – Several home buying Companies won’t purchase the home to live-in, so you can generally agree on the moving-out date, in the long run, to assist you to plan the next move. 

3. It is useful – A secure, fast sale with the help of the right home buying company Calgary can support against the threat of repossession, smoothen out the sudden re-location requirements, or sell the unwanted inherited property. 

4. It is quick – You can get the offer within 1 day & sell the property often within the fortnight, something which is not possible in the open market. 


Wondering whether the house-buying Company is/isn’t the perfect choice for you? Well, its answer depends upon your individual goals and situation. Distinctive house-buying Companies serve different house-owners types. iBuyers are a good alternative for those who are selling properties in a good condition at a specific price point. While rental investors are the most suitable option for the ones with rentable properties in the high-yield areas. Besides, home flippers are often seeking distressed properties. You can choose the most suitable one as per your needs and preferences so that selling your house remains a smooth and convenient fair. 

Investors differ by location, & you will be required to do a bit of digging to look for options in the area. Legitimate house buying companies must have well-verified credentials. Make sure to see whether or not they are recognized with BBB (Better Business Bureau). Ask for the firm’s NMLS (Nationwide Mortgage Licensing System) number & utilize their consumer access site for ensuring the Company you are working with is authenticated for providing monetary services in the state. In the current market, Companies that purchase houses have modified the realty landscape. While still, individual buyers are the norm, the house-buying Companies are surely modifying this landscape, for the better.