What a cash offer is built on
Most companies that buy inherited houses for cash plan to repair and resell, or to rent. Their offer starts from what the house would sell for after repairs, then subtracts the repair budget, their holding and selling costs and their profit. That is why a cash offer is usually well below what the same house would bring on the open market.
In return, the seller can get speed and simplicity: many cash buyers offer to take the house as it is, sometimes with the contents, and to close quickly. Whether that actually happens depends on the contract and the buyer: an inspection period, an assignment clause or a shortfall in funds can change the price or the date. For some families a solid cash contract is worth the difference.
What listing the house takes
A listing exposes the house to every buyer looking in that area, which is what drives the price up. It also means clearing the house, cleaning it, possibly some repairs, photos, showings, buyer inspections and a closing timeline that depends on the buyer's loan.
The estate pays the costs of sale out of the proceeds, so the comparison has to use the net figure. My cost to sell a probate house guide lists those costs.
Compare the two as net numbers
Put both options on one page. For the listing: the likely sale price for the house as you would sell it, minus any work you would do first, minus the costs of sale, minus the months of loan payments, property tax, insurance, HOA dues and utilities until closing. For the cash offer: the offer price, minus its smaller costs, minus the shorter carrying period.
If the listing still nets clearly more after all of that, the extra time and effort are usually worth it. If the gap is small, or the estate cannot carry the house for months, the cash offer can be the better choice. My executor's pricing guide shows how I estimate the as-is price.
How probate or a trust changes the choice
A trustee or an executor has to act in the interest of the heirs, and an unusually low sale can draw objections. Getting the house in front of the open market, or at least an opinion of its market value, helps show the price was fair.
In a probate sale that goes to a court confirmation hearing, other buyers can overbid at the hearing, so a low cash offer may not hold. My probate offer comparison explains how offers are weighed in that setting.
Questions to ask any cash buyer
Ask for written proof of funds, not a promise. Ask whether the offer has an inspection or 'due diligence' period that lets the buyer cancel or cut the price after a walk-through, and how long it lasts. Ask how much earnest money goes into escrow and when it becomes non-refundable.
Ask who will actually close. Some buyers sign a contract and then try to sell that contract to someone else before closing; if the contract allows assignment, the estate may end up dealing with a buyer it never met. Ask who pays escrow and title fees, whether the buyer takes the house with the contents, and what happens if someone still lives there.
If a family member still lives in the house
An occupied house changes both options. A cash buyer may still close, but usually prices in the time and uncertainty of getting the house vacant. A listing needs a plan for access and showings. My guide to selling with family living there covers how executors and trustees handle it.
When a cash offer can make sense
A cash sale can be the better path when the house needs major work the estate cannot fund, when no one can manage repairs or showings, when the estate has little cash to carry the house, or when the family needs a firm date the buyer will commit to in writing. Even then, get more than one offer and check each buyer's proof of funds and contract terms.
If cash is short, there are also middle paths, such as a light clean-up and an as-is listing. My little estate cash guide covers them.
Questions about cash offers for inherited houses
Is a cash offer for an inherited house lower than market value?
Usually, yes. Most cash buyers price in repairs, holding costs and their profit, so the offer sits below what the house would likely bring on the open market. The question is whether the speed and convenience that particular contract actually commits to are worth the difference.
Can an executor accept a cash offer during probate?
Yes, within the executor's authority. With full authority, notice of the proposed sale goes to interested people before closing; with limited authority, the court confirms the sale at a hearing where other buyers can overbid.
How do I check whether a cash offer is fair?
Compare it with a realistic as-is market price for the house, minus the costs and months of carrying a listing would take. Get more than one offer and confirm each buyer's proof of funds.
Can I sell an inherited house as-is without a cash buyer?
Yes. You can list the house as-is on the open market. Buyers still inspect and price in what they find, but more buyers compete for it than in a single cash offer.
What should I watch for in a cash offer contract?
Proof of funds, the length of any inspection period that lets the buyer cancel, how much earnest money is at risk and when, whether the buyer can assign the contract to someone else, and who pays escrow and title fees.