How Can I Sell My Home with Mold in 2024?

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Even though the information on this web page is provided by a qualified industry expert, it should not be considered as legal, tax, financial or investment advice. Since every individual’s situation is unique, a qualified professional should be consulted before making financial decisions.


Mold is one of the forms of water damage that significantly complicates the sale of a house. It may be essential in aging beef and cheese. But it doesn’t belong in your house. If your house does have a mold problem, selling it can be a real challenge. Mold and real estate transactions don’t mix well. But there are still a few ways to sell your mold-infested home. This guide will help you understand what options you have.


3 Scenarios of how Your House with Mold Can Be Sold

1) Sell to an Investor

A cash home buyer is a company comprised of real estate investors.. These investors help homeowners who face difficult situations in selling their property. Cash house buyers purchase property AS IS—regardless of condition. They repair it and then resell for profit. The real estate transactions with investors take much less time than traditional transactions. And investors pay homeowners with cash at closing.


Advantages of Selling to a Home Buying Company

To sell a house in perfect condition is no easy task. To sell a house with black mold growing in the basement seems nearly impossible. One of the biggest advantages in selling to a homebuyer is that they buy houses in any condition. You don’t have to worry about any mildew or mold issues. Sell your house AS IS. And you can walk away at closing with cash on hand.

Another advantage of selling your home to a homebuyer is the speed of the sale. Typically, the entire real estate transaction can be completed in just a matter of days.

Homebuyers pay for your property with cash. You get all the cash specified in the cash offer. There are no real estate commissions, no closing costs, and normally no hidden fees, if the company is legitimate. You leave the closing with cash in hand.

Selling to a home buyer has a minimum amount of paperwork. Because it‘s a cash transaction, there’s much less paperwork in the closing process.


Disadvantages of Selling to a Home Buying Company

The ability to walk away from a problem property with cash in hand comes at a price. Because real estate investors buy property AS IS, you will not receive the full market value. Their cash offer factors in all the costs they expect to incur in buying, rehabilitating, and re-selling your house.

Due diligence is important when selecting a home buyer. Mixed in with all the reputable home buyers, there are many scammers who want to prey on unsuspecting sellers.


How to Find the Right Home Buying Company

As with any industry, the home investor market has newcomers who lack experience. If possible, avoid those who are new to the industry. Instead, ask for offers from established and reputable home investors.

The home investor market also has more than its share of scammers who want to take advantage of uninformed homeowners. Do not allow scammers to fool you. A little research about the home buying industry can help you recognize the scammers.

To have the best possible selling experience, make sure to do your homework. Put together a list of cash home buyers in your area. Go to their websites and study whatever reviews you can find. Pick out the top three or four and schedule a meeting. Request a cash offer from each, compare them and select the highest one.

However, beware of investors who make offers too close to the market price of your house. If it looks too good to be true, it’s either a fraud or the investor is inexperienced.


2) Traditional Sale with a Realtor

In a traditional real estate sale a prospective realtor will look at your house and discuss its sale. They will show you comparable properties to give you an idea of what your house might be worth. If your house needs some minor updating they will make suggestions that will help you get a better offer. And they will also talk to you about staging your home to advance its appeal to buyers.

A good realtor will assist you with the sale of your home from setting the asking price to the final closing.


Advantages of Selling with a Real Estate Agent

Houses that have had mold issues are sold every day across America through traditional sales. But it takes an experienced realtor to help walk you through the process. A good realtor becomes your partner for the duration of the sale.

An agent who has experience in selling homes with different types of damage will know the right contractors to contact. They will refer you to companies who can help with mold remediation and any other repairs. And they will know the kind of remediation that will satisfy the average buyer.

A good real estate agent will spend time and money advertising your home to give it maximum exposure. They will reach the most potential buyers through the MLS (Multiple Listing Service).

They will tell you how you should stage your house for the best possible presentation. And they will show your house to potential buyers.

In a traditional real estate sale you can sell your home for the approximate fair market value (adjusted for your home’s condition). When a potential buyer’s agent makes an offer, your realtor will negotiate on your behalf to get the best possible price. They can work with the buyer’s agent to help set the buyer at ease about the past mold problems.


Disadvantages of Selling with a Real Estate Agent

You will be responsible for the costs of any mold inspection and remediation. You will also be responsible for fixing whatever caused the mold. In some cases even HVAC updates are required, such as fixing duct insulation or purchasing and installing a dehumidifier. No traditional buyer will close on a house with existing mold problems. If your property has other issues, they also should be fixed before the sale.

Any staging or updating will be an added expense in a traditional sale.

Although the realtor will show your house, showings are disruptive—especially if you have small children.

The traditional sale can take several months to complete—especially if the house has a mold disclosure attached.

Traditional sales have added fees in addition to the real estate agent’s commission. Closing costs will be due at closing. Be prepared to also discover hidden fees and other unexpected costs.


How to Choose the Right Real Estate Agent

The right real estate agent will be easy to work with and will help you get the best possible price for your house. If you have a house with mold issues, you will need a realtor who will put forth extra effort when advertising and showing your property.

Consider asking family and friends who have recently sold property for agents they would recommend. Websites such as Zillow can also help with agent recommendation.

Contact a few of the recommended agents and talk to them about your project. Compare their suggested asking prices. Agents who know what they are doing will suggest similar asking prices. So drop any agents who recommend a significantly higher or lower asking price.


3) Sell It Yourself (For Sale by Owner)

You have probably seen FSBO (for sale by owner) signs in your neighborhood. While it’s a tempting thought to save the real estate commission, selling your house yourself on the traditional market is the most difficult option of all. You will be responsible for everything from setting the asking price to the closing.

You don’t have to go it alone though. For a fee you can advertise your home on multiple websites. And you can still use the limited services of a real estate agent.


Advantages of Selling by Yourself

Selling your house yourself appears to be the best way to get the most money. After all, you are saving the entire real estate commission. But it’s only a possibility and not a guarantee. Take a close look at the disadvantages before deciding.


Disadvantages of Selling by Yourself

You have to set the asking price yourself. If you set the price too high, your house will not sell. If you set the asking price too low, you risk losing money unnecessarily.

It is unrealistic to expect to sell your house to a traditional buyer without fixing any mold issues. And your cost for remediating the mold and repairing the underlying causes will be the same as they would be in a traditional sale.

There won’t be a realtor to ease a buyer’s fear of a future occurrence. You will have to convince the buyer that the cause of any mildew or black mold has been permanently fixed. And when that mold in the basement was only minor to start with, you will be the one to convince the buyer that there has never been any real health threat.

You will have the same staging and updating expenses as you would if using a realtor.

You will have to show the house yourself, which can be time consuming. And it can be extremely uncomfortable to stand by as a buyer criticizes your property.

You will need to get all the proper disclosure and release forms yourself. They will all need to be signed prior to closing. This is a critical protection from future lawsuits.

You will have all the same fees as you would with a traditional sale—minus the real estate commission.


Selling a House After Mold Remediation

Consider the following illustration:

You have successfully remediated the mold found in your house. You have identified the source of the moisture, and that source has been eliminated—whether a leak, excess humidity, or something else. Even though your house has mold in its history, you know that the issue will never reoccur.

Two possible scenarios:

  1. Your traditional buyer loves everything about your house except the mold disclosure. What do you say to this buyer to set their mind at ease?
  2. Trying to alarm you with the seriousness of your home’s mold history, an investor makes an extremely low cash offer for your house. How do you make the investor understand that you know better, and you expect a higher cash offer?

Keep this simple fact in mind as you talk to any potential buyer. No moisture—no mold! Mold will not form without moisture. Once the mold and the source of moisture is eliminated, mold will not return.

As an example, ductwork in a crawl space will sweat (on the cooling cycle) if it’s not insulated. If the HVAC contractor carelessly attached a piece of uninsulated duct to a floor joist, black mold could have formed from the condensation.

With a good understanding of mold remediation, this example is an easy fix. First of all, reduce the humidity in the crawl space by installing a dehumidifier. Or put down a vapor barrier on the floor of the crawl space. Then clean the mold from the wood and insulate the ductwork. The mold will not return (this is not the same kind of issue as a mildew smell and spongy sheetrock with gray and black spots throughout the house. Such a house might even be a tear-down).

Do not panic. And do not think of an isolated spot with black mold as reason to condemn your entire house (however, even selling a condemned property is possible). Remember. No moisture—no mold!

Understand both the remediation and the cause of mold before ever trying to sell your house. No real estate investor will be able to get you to accept a lowball offer by overstating past mold problems. And you’ll be in a position to reassure a traditional buyer that your house’s mold issues are in the past—and will stay there.


Mold Disclosure when Selling a Home


Is It Legal to Sell a House with Mold?

Yes, it is legal to sell a house with mold—even toxic black mold—to anyone. There are no legal restrictions against this. But some states have legal restrictions against selling a residential property without disclosing past or present mold issues to the potential buyer.

Sounds complicated? It is. For example, cash house buyers buy houses AS IS. When the seller accepts the buyer’s cash offer the seller is no longer responsible for any existing defects in the property. What would happen if the seller purposefully hid black mold from a real estate investor prior to accepting their cash offer? Regardless of the documents signed between the investor and the homeowner, the cash buying company could initiate a lawsuit for purposeful non-disclosure.

The issue is not about selling a house with mold. The issue is about disclosing mold to a potential buyer. It is legal to sell a house with mold. But it’s safer to disclose any mold issues (past or present) for the benefit of both the buyer and the seller.


What is a Toxic Mold Disclosure?

A toxic mold disclosure form is typically both a mold disclosure and a release document. No standard form exists. The purpose of the form is to fully disclose the existence (past or present) of mold (possibly toxic) by the seller to the buyer. In turn the buyer acknowledges this disclosure and releases the seller from any responsibility (past, present, or future). Some forms only pertain to mold-related issues while others include additional home defects.

Make sure that your real estate transaction is protected from future legal action. Regardless of your state’s laws, be certain to get both mold disclosure and release documents signed by your buyer prior to closing. Toxic mold disclosures for home owners are available as an online download. But you would be better protected if you used one furnished by a local attorney familiar with your state’s real estate laws.


Do you Have to Disclose Mold when Selling a House?

Federal law does not require the disclosure of mold. Each state has jurisdiction over its own disclosure laws. But mold litigation is on the rise. Regardless of the laws in your state, protect yourself from future lawsuits when selling a home with past or present mold issues.

For example, in many states the buyer is responsible for discovering defects in the home (buyer beware). In other states, the seller is required to disclose any mold issues (past or present). And some states not only require the seller to disclose but also the real estate agent and the appraiser.

What about a seller who doesn’t know about a mold problem, and that problem is only discovered after closing? Obviously, the seller did nothing wrong. But ignorance of a mold issue is not an effective deterrent to a lawsuit.

In conclusion, disclose any mildew or mold in the basement—or elsewhere. Disclose any other defect in your house. Make sure the buyer signs off on your disclosures. And make sure the buyer releases you from any other known or unknown issues with your house.

About the Author
Brian Robbins | Real Estate Investor

With over 20+ years of experience in real estate investment and renovation, Brian Robbins brings extensive knowledge and innovative solutions to the HouseCashin team. Over the years Brian has been involved in over 300 transactions of income producing properties across the US. Along with his passion for real estate, Brian brings with him a deep understanding of real estate risks and financing.

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