Real estate transactions don’t have to be prolonged, complex or unnecessarily costly. Instead, House Buyers KC takes a different approach to residential real estate, one that simplifies and expedites the sale or purchase to the benefit of all involved parties.
House Buyers KC works with a variety of sellers who share one commonality: they want to sell their home quickly. Perhaps they’ve lived in a home for years, they inherited the home, used it as a rental property or simply need to move quickly due to a change in circumstances such as a job transfer. Whatever the situation, prospective sellers reach out to House Buyers KC, which then begins a thorough evaluation of the property.
“We take a look at the condition of the property, including the roof, siding, windows and doors — essentially a full exterior evaluation,” said Chad Lower, manager and licensed real estate agent with House Buyers KC. “We then examine the interior, including the condition of the walls, floors and paint. We look for any upgrades, updates or repairs that need to be done, then we calculate an estimate.”
With that estimate, the House Buyers KC analyzes the surrounding neighborhood to determine the selling price of similar homes. The repair costs, holding costs, and profit are then subtracted from that figure, results in the seller’s offer.
Part of the appeal of House Buyers KC’s approach is speed. Consider the average home listing, which might be on the market for 30 to 60 days. Factor in closings that can easily surpass 45 days, and it’s no wonder that home sales can unexpectedly fall through due to a variety of factors, leaving both the buyer and the seller scrambling for alternatives.
Compare that to House Buyers KC, which pays cash for each home through private lenders. By eliminating bank financing and shouldering responsibility for a home’s repairs and updates, House Buyers KC significantly shortens the selling timeframe, resulting in closings in as little as 10 to 14 days.
“We don’t charge any commissions, and we won’t ask the seller to pay any closing costs,” Lower said. “The time on the market is zero.”
The involvement of private lenders plays a significant role in enabling House Buyers KC to move so quickly, and in a way that brings optimal results to both the lender and the seller.
“Our private lenders bring speed and efficiency to our transactions and our leverage is far greater as a result,” Lower said. “Many of our homes are in need of a quick sale — 10 to 14 days — and the traditional closing is 30 to 45 days. Using quick cash as leverage lowers the purchase price and reduces our risk. Additionally, being able to offer a fast closing with private funds entices sellers to take our offers.”
Private money lenders are given a first or second mortgage that secures their legal interest in the property, as well as their funds. As a result, the private lender can yield extremely high interest rates, generally 8-10% APR, with relatively short terms — the typical holding timeframe on House Buyers KC’s rehab properties is 3 to 6 months. Compare this to a typical real estate investment — navigating the challenges and complexities of acting as a landlord — and it’s no surprise that private lenders find the ease and success of the House Buyers KC model much more appealing.
“We have a few friends who act as our private lenders,” Lower said. “They generate passive income with little involvement, and they enjoy working with us because they like being involved in real estate but don’t necessarily want to deal with the headaches of working with contractors, tenants or manual labor.”
For those lenders, working with House Buyers KC is a chance to diversify investment opportunities in a way that potentially carries less risk than other options. If a lender has money in the stock market, for example, that investment is unsecured and offers unknown returns. In purchases with House Buyers KC, lenders know that their funds are secured by a mortgage deed, the collateral is fully insured and they’re collateralized at below market value because House Buyers KC purchases at a discount. Additionally, the returns are fixed, agreed-upon terms; and lenders have the option to see their funds in action, depending on the degree of involvement they want to have in a particular transaction. This sort of flexibility is rare in the investment market, and just another reason that private lenders find the House Buyers KC model so appealing.
“They can drive by the house, see it and see where their money is,” Lower said.
The House Buyers KC approach doesn’t just benefit their private lenders — it’s also a help to sellers, not to mention their neighbors. House Buyers KC strategically identifies neighborhoods that are in high demand and that typically have a residential selling point of $150,000 or more. That ensures a higher likelihood of reselling the home once the upgrades and updates are complete.
“We’re buying in nice neighborhoods, and maybe there’s one home that’s in need of repairs or updates,” Lower said. “Once we improve the property, the neighbors benefit, too, because it raises property values for the area and improves the overall environment, making it a better place for the residents and their families.”
For those interested in educational information about buying or selling homes and mailbox money, contact House Buyers KC at (913) 777-4444 or visit HouseBuyersKC.com.
House Buyers KC
Location: 6900 College Blvd., #930, Overland Park, Kan.