List or Sell to an Investor?

I recently listed my house. I was only getting lookie loos so I decided to try a cash investor. Between the money saved by not paying a commission and the reduced capital gains and not having to deal with strangers going through my home, no contingencies, no inspection, moving when I was ready...it all seemed worth it.  

Well, I learned that, in my case, the investor I chose never wanted to buy my house. They only wanted to sell it. They strung me along until they figured I would be willing to let them sell my house and then they pulled the rug out giving me some BS reason why they didn't want to buy it anymore. Right! When pigs fly am I going to let you sell my house. I had contacted other investors. One was honest enough to tell me they knew they couldn't give me what they knew I probably wanted for the house because it is not a fixer upper and that is where they make their money. Others were obvious about just looking to flip houses. In hindsight there were clues.

One was wanting to put a lock box on. Another was saying that they didn't care about some problems with the floors. Another was a 3 page purchase agreement that was just full of loopholes by design. 

Don't get me wrong, there are situations where it is the right move. i.e. You inherit a house that needs a lot of work to get it ready to sell or it is way outdated and needs to be renovated and you don't have the time or the money to do it yourself or you live far away like in another state. But be aware, you will pay for the convenience. Expect to take a minimum of a 10% hit and most likely more. 

One thing that I did not realize is that when you sell to an investor you become a For Sale By Owner. An FSBO. You are on your own. You better know what you are doing. One thing that happened to me is that this company said they were going to put up $10,000 in earnest money. When they backed out of the deal I figured the $10,000 was mine. Whoa! Not so fast. They said they were still within their discovery period and since a comparable was reducing their ask that their offer was no longer profitable. But that didn't really matter anyway because they never put the money in escrow???? I just assumed that was an obligation. It apparently isn't. 

(Go to Cliches and look at the section about making assumptions)

There was a path here to knowing how this all works. I was just too naive and trusting to take it. (Here is a case where one should not assume!) If, and that is a big if, I were ever to even think about selling a house to a cash investor, I would get a lawyer. I would make sure that 3% earnest money was deposited within 5 days of signing or the whole deal is null and void. I would have the lawyer write up the purchase agreement and would make it so there was no way out, no contingencies, no inspections, no discovery period, no anything. 

Chances of any one of the investors I talked to accepting those conditions is probably non existent. 

Just sold my house through a realtor. Best way to go but there are things that I wish I knew.