Selling your house for cash should be simple. Someone makes you an offer, you agree on a price, and you close in a couple of weeks. But the reality is that not every company knocking on your door or sending you a text actually buys houses.
Before you sign anything, ask these five questions. The answers will tell you everything you need to know about who you are dealing with.
1. "Are You the Actual Buyer, or Will You Assign This Contract to Someone Else?"
This is the single most important question you can ask, and it is the one most sellers never think to ask.
In real estate wholesaling, a company puts your house under contract and then assigns that contract to another investor — someone you have never met. The wholesaler profits from the spread between your price and what the end buyer pays. They never use their own money to buy your property.
What a good answer sounds like: "Yes, we are the buyer. We purchase properties directly with our own funds. There is no assignment clause in our contract."
A red flag: "We work with a network of investors..." or "We may assign the contract to one of our partners..." or any answer that does not clearly confirm they are the end buyer. This does not mean the deal is bad — it means you are working with a middleman, and you should understand that before you proceed.
2. "Can You Show Me Proof of Funds?"
A real cash buyer has the money ready to go. They can show you a recent bank statement, a letter from their financial institution, or documentation of a line of credit — before you sign the purchase agreement.
What a good answer sounds like: "Absolutely. Here is our proof of funds. We can also provide this directly to the title company if you prefer."
A red flag: "We will provide that closer to closing" or "Our funding is arranged through our investor network." If someone cannot show you the money exists today, there is a meaningful chance the money will not exist at closing either. A legitimate buyer has nothing to hide here.
3. "Have You Closed on Houses in My Area?"
This question accomplishes two things. First, it tells you whether the buyer has real experience. Second, it tells you whether they are local or operating remotely from another state.
Virtual wholesaling has become increasingly common. Companies in one state send mass texts to homeowners in another state, make offers on houses they have never seen, and try to assign those contracts to local investors. They may have no understanding of your neighborhood, your local market, or what your house is actually worth.
What a good answer sounds like: "Yes, we have closed on [specific number] of properties in [your city/area]. Here are some examples, and we are happy to share references."
A red flag: Vague answers like "We buy houses nationwide" or an inability to name specific properties they have purchased in your market. Experience in your local market matters — it means the buyer understands neighborhood values, knows the title companies, and can close without surprises.
4. "What Fees Will I Pay at Closing?"
With a traditional cash sale, the seller's closing costs are minimal and well-defined: title insurance, recording fees, prorated taxes, and perhaps a small settlement fee. There should be no surprises.
Some companies, however, add fees that a seller would not normally pay: "processing fees," "administrative fees," "transaction coordination fees," or "marketing fees." These can add up to thousands of dollars and effectively reduce your net proceeds below the offer amount.
What a good answer sounds like: "You will pay standard closing costs — title insurance, recording fees, and prorated taxes. We can walk you through the estimated settlement statement so there are no surprises. We do not charge any additional fees."
A red flag: Vague answers about fees, reluctance to provide an estimated settlement statement, or any mention of proprietary fees that are not standard in a real estate transaction. Ask for a written estimate of all costs before you sign.
5. "What Happens If You Can't Close?"
For a legitimate cash buyer with funds in hand, this question is almost irrelevant — they have the money, so there is no reason they cannot close. The answer should be straightforward.
But for a wholesaler who needs to find another buyer, or a novation company that needs to list your house and find a retail purchaser, the inability to close is a real possibility.
What a good answer sounds like: "We close on every property we put under contract. We do not make offers we cannot back up. Here is our track record."
A red flag: "In the unlikely event we cannot close, the contract allows either party to cancel..." or any language that normalizes the possibility of not closing. If the buyer is building in an exit for themselves, ask yourself why they need one.
Why These Questions Matter
None of these questions are confrontational. You are not accusing anyone of anything. You are simply gathering the information you need to make an informed decision about one of the largest financial transactions of your life.
A legitimate cash buyer will welcome these questions. They will have clear, confident answers because they have nothing to hide. If someone gets defensive, evasive, or tries to rush you past these questions, that tells you something important.
A Better Way to Evaluate Your Options
FairOffer uses AI-powered analysis to provide property assessments based on real market data — comparable sales, local trends, and property condition factors. Instead of relying on a number from someone who may have never seen your house, you get an assessment grounded in data.
Want to know what your home is actually worth? Get a free, no-obligation assessment from FairOffer — and compare it to any offer you have received.