Real Estate the Ramsey Way - Can You Really Trust ‘Buy Homes For Cash’ Companies?

Episode Date: July 7, 2025

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Dave Ramsey here and welcome to another episode of Real Estate, the Ramsey Way, where you'll learn how to make smart home decisions, avoid costly mistakes, and navigate homeownership with confidence. All right, today's question comes from Amy in Tennessee. She says, how do you feel about those buy homes for cash companies? Our home has been on the market for months with no offers and we're running out of time to close on our new home. I could tell you what I think.

Dave's probably going to be the expert on this, but my initial thought says if they're buying a home for cash, they know you're desperate. They're probably going to give you a lower offer because it's in cash. And my bigger question to you would be, why is it not selling? There's probably a reason. Maybe something that you can take care of or handle as to why it's not selling.

Maybe it's not priced right. Maybe your home has a weird smell. Like maybe there's something going on. Maybe it's your realtor. So those are questions I'd probably be asking first. Buy homes for cash fuels. Maybe it's the realtor that has a weird smell. Yeah, maybe the realtor has a weird smell.

Trust me, you don't want that. Sorry, I just went there. I mean, you know those signs that you see on the corner and they're like handwritten. Those are called wholesalers, meaning that they are buying the property for flipping. And if they're going to buy it at a price that they can resell it and make a profit, low ball. That's called a wholesale price, and you're not going to like that price. That means you are super desperate to buy this other house that you should probably just let go. Because you probably have a contingency on closing on the new home, and the contingency says if your house hasn't sold,

that you're not required to close, and you probably shouldn't close on it unless you can get rid of this other one without giving it away. I mean, are you going to give up an extra $50 or $100,000 or whatever the number is in order to just get this other property? Yeah, so. But there's nothing like negative about those cash buyers. Like they're not doing anything wrong. I mean, some of them are slimy, but but most of, mostly it's just they're buying the property to resell. It's like a car dealer buying your car. That's right.

They're going to give you the lowest. They're going to give you wholesale on it, trade in value because they're going to resell it at the retail value. And they make money, they make the profit on the difference in wholesale and retail. Yes, they want that spread. You know, that's so, I mean, if it, Carvana or CarMax is not going to give you as much for your car. private sale well. And so in most cases, I mean, there's very few exceptions to that. And that's true in the housing market.

Now, there are a few proper people buying single families out there that are buying them to hold long term. And they're not individuals. They're more like hedge fund types. And they're paying like retail. So if you want to get a price from one of them, it's probably not the sign on the corner. But, you know, what you've got to do is you have to get away from this sense of desperation that I I'm running out of time. The way the sentence is structured tells me you're getting ready to give your house away,

and I don't want you to do that. Well, she's already found a kitchen that she would be cooking in. She done got to Fiva. Hey, guys, thanks for listening to Real Estate the Ramsey Way. Now, if you're here, you're probably thinking about buying or selling a house. It's exciting, and one of the biggest financial decisions you'll ever make. But you don't want to do it with an inexperienced. agent who will rush you into costly mistakes, like the ones some of our callers find themselves

in. You need a pro who knows what the flip they're doing and will keep you on track with your financial goals. That's why we only recommend Ramsey trusted real estate agents. These are vetted, hand-picked pros who actually listen to your needs, guide you through the process, and fight to get you the best deal. To find a Ramsey trusted agent near you, go to Ramsey Solutions.com, Trusted Agent. That's Ramsey Solutions.com slash trusted agent. Amanda's in Stanford, Connecticut. Hi, Amanda. How are you? I'm good. How are you? Better than I deserve. What's up? Okay. I need say that. I am kind of in a transition period of my life. I am a mom and I have two boys.

One is going to be a senior in college. One is going to be a freshman in college. My alimony and child support ended this month. And I'm in the process of selling my home, or I'd like to do that and sell it by October 1st, but I'm wondering if that's the right decision. Why are you selling it? Because get paid twice a month. One of my paychecks is equal to my mortgage payment, and that's, you know, the paycheck after taxes. Yeah, that doesn't work.

And you drop in the child support in the alimony, so it leaves you in jeopardy. I agree. Yes. Okay. Yeah, you've got the home left over as a marital asset, and it represents another life that's no longer here. When you sell the house, what will you earn? What will come of it? Well, I still have a mortgage, but based on, you know, the market, it's still pretty strong in Connecticut.

So, you know, I could make upwards of like $400,000, you know, after everything. So I wanted to basically find another house that I could almost pay cash for. I like it. I like it. I like it a lot. Are you going to stay in that area? I'm going to try. The market is very tough here, and there are very few houses in my price range, and usually you have to bid above asking price. The other alternative would be to move south where my job is located because I work remotely. But I'm concerned that my children will come with me, and I don't want to leave them behind. And I also have a 93-year-old mother and is still living in this area.

Yeah. So I feel like emotionally. The good news is you can move out of ways because you work remote and move out enough and let the pricing go down. Yeah. Yeah, I can do that. Yeah, you're right. You're going to go through a culture shock of not living in the same neighborhood that you've been in for, I'm guessing, 20 years. Yeah, just about.

Yeah. It just sounded like a 20-year-old story. Okay. Yeah. Yeah. I'm sorry. Your heart's been broken. couple years, hadn't you?

I would say, yeah, more like eight to ten. Yeah. Yeah, the last few have been tough, and I'm just trying to do the right thing for everybody. Yeah, it's not everybody. It's you. You need to do the right thing for you. You've taken care of everybody else long enough, and this is the right thing for you. Letting a house drown you while you're wounded and not swimming well is not a good idea.

I'm with you. I love you selling this house. I think you're very wise. Okay. that's so good to hear thank you thank you darling sorry you're going through this it's harsh hard stuff it is hard but she was i mean she's she's wise yeah and she's smart for her to foresee that yeah she she didn't let the emotions override the decision and there's a lot of emotions there so it's real i've seen that i don't know thousands of times that the lady keeps the house in the

divorce, but the house was based on the dual income. Very difficult to do and does it in the name of keeping the kids in the school district and that kind of stuff, but really straps herself to where she can't breathe. I've seen it a lot.