How to Sell a House As-Is

‘As-is’ means something different on the MLS than it does in a cash sale. The difference determines whether the sale closes.

Short version: When a real estate agent lists your house “as-is” on the MLS, it signals to buyers that you won’t fix anything after inspection — but the buyer’s lender still sends an appraiser who can require repairs before funding. A cash buyer skips the lender entirely, so there is no appraisal and no repair list. These are not the same transaction. Confusing them is the most common reason an as-is sale falls through at the worst possible time.

Two definitions that cost sellers real money

Most sellers use “as-is” to mean one thing: they’re done spending money on this house. That’s a reasonable position. The problem is that the phrase carries two legally and practically different meanings depending on where it appears, and conflating them leads to deals that collapse forty-five days in.

As-is on the MLS is a listing instruction to the buyer’s agent. It tells the market that after a home inspection, you will not negotiate repair credits, price reductions tied to defects, or cure any items on the inspection report. It does not tell the buyer’s lender anything. The lender doesn’t read your MLS remarks. The lender sends its own appraiser, and that appraiser operates under federal guidelines that have nothing to do with what you and the buyer agreed to.

As-is in a cash sale means no lender exists at all. There is no appraiser. There is no minimum property standard review. The buyer accepts the property in its current condition because the buyer is using their own funds and answers to no underwriter. This is a categorically different transaction — not a more aggressive version of an MLS listing, but a different type of sale.

The financial consequence of confusing these: a homeowner with a fire-damaged house or a property with foundation issues lists on the MLS under the as-is flag, gets an offer from a buyer using FHA financing, and then learns four weeks later that the appraiser has flagged the property as failing minimum property requirements. The lender won’t fund. The buyer can’t close. The seller is back to square one after losing a month and spending money on inspections, disclosures, and carrying costs. If that scenario describes your situation, you may want to read more about selling a fire-damaged house before going the MLS route.

What FHA, VA, and USDA appraisers actually look for

Federal loan programs exist to help buyers with limited down payments, and in exchange those programs require that the collateral — your house — meets minimum property requirements at the time of funding. These are not suggestions. If the appraiser flags a condition, the loan cannot close until that condition is resolved. The seller typically absorbs the cost because the buyer can’t.

Common conditions that create required repairs under FHA guidelines (Handbook 4000.1) and VA (Lenders Handbook Chapter 12) include:

• Missing or broken handrails on stairs with more than three risers
• Active water intrusion or evidence of ongoing moisture damage in the crawlspace or basement
• Exposed or frayed wiring, open junction boxes, double-tapped breakers flagged as safety hazards
• Roof with less than two years of remaining useful life by appraiser estimate
• Peeling paint on any interior or exterior surface in homes built before 1978 (lead paint protocol)
• Inoperable heating system, particularly in northern Tennessee where winter temperatures fall below 32 degrees
• Broken windows that compromise weather resistance
• Any structural condition the appraiser deems unsafe for occupancy

USDA Rural Development loans use similar language under their Property Eligibility requirements. A property that is livable but worn — the kind most sellers are trying to move without spending more money — often carries two or three of these flags. An as-is MLS listing does not protect you from any of them.

A buyer using conventional financing has more flexibility if the loan-to-value ratio is low enough, but Fannie Mae and Freddie Mac also require appraisers to note conditions that affect safety, soundness, or structural integrity. The practical effect is narrower than FHA but still real for properties in poor condition.

Tennessee disclosure law does not have an as-is exemption

T.C.A. § 66-5-202 requires sellers of residential real property to complete a disclosure form covering all known material defects before a buyer enters a purchase agreement. The statute applies to all residential sales of one to four units. It does not carve out as-is sales. It does not carve out estate sales. It does not carve out foreclosure situations.

What “known” means here is the operative word. You are not required to hire an inspector and discover defects you were unaware of. You are required to disclose defects you already know about — the foundation crack you’ve been watching for three years, the HVAC unit that’s been underperforming, the neighbor’s drainage that pushes water toward your east wall every spring. Choosing not to disclose a known material defect in hopes that the as-is language provides cover is not a legal strategy. It is fraud under Tennessee law, and buyers can and do sue after closing when they discover defects that were known and undisclosed.

The disclosure requirement applies regardless of who the buyer is. A cash buyer is not exempt. If you sell to us, you still complete the disclosure form. We expect that. The form does not change our interest in the property — we buy houses that have problems; that’s the nature of the business — but the disclosure protects you legally after the sale closes.

If you are selling on behalf of an estate, T.C.A. § 30-2-401 gives the executor or administrator authority to sell estate property, but it does not suspend disclosure obligations. The executor must disclose what is known about the property, and “we didn’t know” is only defensible if there was a genuine absence of knowledge, not deliberate avoidance of inspection. More detail on the mechanics of estate sales is in our guide on selling an inherited house in Tennessee.

How cash buyers calculate what they can offer

The offer a cash buyer makes is not a guess or an attempt to lowball until you accept something. It follows a formula that any real estate investor uses because the math has to work for them to stay in business. Understanding the formula lets you evaluate whether the number makes sense.

ARV × 70% − estimated repair costs = maximum offer

ARV is After Repair Value — what the house will sell for on the open market after all repairs are completed and the property is in standard retail condition. The 70% factor accounts for the investor’s margin, holding costs during renovation (property taxes, insurance, utilities, financing), transaction costs on both the acquisition and the resale (roughly 6% on each end with commissions and closing costs), and a buffer for cost overruns in renovation.

Example with real numbers:

A three-bedroom, two-bath house in Antioch has comps showing similar houses in updated condition selling for $285,000. That is the ARV. The house needs a new roof ($12,000), kitchen update ($18,000), full bathroom refresh ($9,000), HVAC replacement ($8,500), and general paint and flooring ($14,000). Total estimated repairs: $61,500.

$285,000 × 0.70 = $199,500 minus $61,500 in repairs = $138,000 maximum offer.

If you received an offer of $135,000 to $142,000 on that property, you are looking at math that tracks the formula. If you received $165,000, either the buyer has different comp data, is using a higher percentage than 70%, or is underestimating repair costs — and you would want to understand which one before accepting.

The 70% rule is not industry gospel. Buyers in competitive markets sometimes move to 75% or even 80% on properties where rehab scope is limited and comps are strong. Buyers in slower markets or on properties with extensive structural issues sometimes drop to 60% to 65%. The formula is a framework, not a fixed percentage.

What the formula does not do: hide the discount. Once you know ARV and estimated repairs, you can run the math yourself and assess whether the offer is within range of reasonable. The discount relative to retail is real — you are paying for speed, certainty, and the fact that someone else is absorbing all renovation risk. Whether that trade is worth it depends on your situation.

As-is MLS listing vs. cash buyer: what actually happens

The net number comparison in the last row is the honest answer to “will I make more on the MLS?” Sometimes yes, sometimes no. On a clean house with cosmetic issues only, the MLS almost always nets more. On a house with structural problems, fire damage, severe deferred maintenance, or active code violations, the math can reverse because financing falls through repeatedly and carrying costs add up. Each failed contract costs you time and often money in renegotiation concessions.

Nashville Metro Codes and Memphis Shelby County: local complications that matter

Two specific scenarios come up repeatedly in Tennessee that add a layer of complexity most national “as-is” guides ignore.

Nashville open permits: Metro Nashville/Davidson County has a permit portal (Nashville.gov/Services/Nashville-Metro-Codes) where all open and expired permits are searchable by address. If a previous owner or contractor pulled a permit for work — a deck addition, electrical panel upgrade, HVAC replacement, anything requiring inspection — and that permit was never closed out with a final inspection, the permit stays open in the system.

An open permit does not prevent you from selling, but it will surface in title search. A buyer’s attorney or title company will flag it. If the buyer is using financing, the lender may require the permit to be closed before funding. Closing an open permit typically requires either a final inspection (the work must pass current code), hiring a contractor to bring the work up to current standards and then get it inspected, or — in some cases — applying for a permit amnesty or expired permit renewal process through Metro Codes.

The cost to resolve an open permit ranges from a few hundred dollars for a simple inspection to several thousand if the original work was not done correctly and must be remediated. A cash buyer absorbs this risk. An MLS sale may stall on it.

Memphis Shelby County flood zone properties: Shelby County has significant portions of its residential housing stock in FEMA Special Flood Hazard Areas (SFHAs), designated on FIRM (Flood Insurance Rate Maps) as Zone AE and Zone X. Properties in Zone AE require flood insurance as a condition of any federally-backed mortgage. USDA, FHA, and VA loans all require flood insurance if the structure sits in an SFHA.

Flood insurance through the National Flood Insurance Program (NFIP) can run $1,200 to $4,000+ per year depending on structure elevation relative to base flood elevation (BFE). When this cost hits a buyer who was not expecting it, deals fall apart. The buyer’s debt-to-income ratio changes, or they simply walk because the carrying cost of the property is now higher than they budgeted.

If you are selling a Memphis property in an SFHA, disclosing the flood zone status on the Tennessee disclosure form is required — it is a known material fact about the property. A cash buyer will already know the flood zone status before making an offer and will factor it into their ARV calculation.

When you should not sell to a cash buyer

This is a service that makes sense in specific situations. It does not make sense in all of them, and we are not going to tell you otherwise.

You should probably not sell to a cash buyer if:

• Your house is in good to excellent condition. If the property needs only cosmetic updates or nothing at all, it will appraise at or near its retail value and a financed buyer can fund without conditions. The ARV formula discount is not justified by the risk reduction it provides when there is no meaningful risk to reduce. List it with an agent.
• You have at least 60 days and no urgency. The speed premium that a cash sale provides costs you money. If you have time to list, show, negotiate, and wait through a normal closing timeline, you will almost certainly net more on the open market on a house without significant defects.
• The ARV math doesn’t add up in your favor. Run the formula before you accept an offer. ARV × 70% − repairs. If you have significant equity and light repair needs, the formula will produce an offer that is far below what the market would pay. The comparison favors the MLS.
• You need more than the property is worth to pay off your mortgage. A cash buyer cannot offer more than the property supports mathematically. If you owe more than the ARV minus repairs minus margin allows, a cash sale will not solve your underwater position. You would need to negotiate with your lender (short sale) or explore other options. More on that situation is covered in our guide on selling a house in foreclosure.

The situations where a cash sale makes genuine sense: structural damage that eliminates financed buyers entirely; severe deferred maintenance across multiple systems; fire, flood, or mold damage that fails appraisal; inherited property that needs full renovation before it would list; hoarder or estate properties where cleanout alone is a significant undertaking; properties with title complications or open liens; sellers who need to close in under three weeks for personal or financial reasons; and landlords exiting properties with long-term tenants in place who make showing difficult.

If your house falls into one of those categories — particularly properties with significant damage — you may find more specific guidance in our pages on selling a hoarder house or selling without a realtor.

Straight answers

Do I have to fill out the Tennessee disclosure form if I’m selling as-is to a cash buyer?

Yes. T.C.A. § 66-5-202 applies to all residential sales of one to four units in Tennessee regardless of how the sale is structured or who the buyer is. You must disclose known material defects. The disclosure form does not affect whether a cash buyer will still make an offer — we expect the form and factor what’s in it into our evaluation — but skipping it creates legal exposure for you after closing. Fill it out honestly.

Why can’t an FHA buyer just waive the appraisal requirements?

Because the appraisal and minimum property standards exist to protect the loan, not the buyer. FHA insures the mortgage — if the buyer defaults and the property goes to foreclosure, HUD takes possession. HUD has required that properties meet a minimum standard of habitability and structural soundness before it accepts that insurance obligation. Neither the buyer nor the seller can waive a federal lending requirement. The only workarounds are financing that doesn’t carry the requirement (conventional at certain LTVs or cash), or completing the repairs before closing.

What happens if there’s an open permit on my Nashville property?

It depends on the buyer and financing type. A cash buyer will typically purchase with an open permit remaining open and handle permit resolution themselves as part of their renovation. A financed buyer’s lender may require permit closure before funding, in which case you either resolve it before closing or the deal falls through. To check your permit status, search your property address at Nashville.gov under Metro Codes. If you have an open permit and want to close it, contact Metro Codes directly — the process depends on the type of permit and when it was pulled.

Can the executor of an estate sell a house as-is?

Yes. Under T.C.A. § 30-2-401, the executor or administrator of a Tennessee estate has authority to sell, convey, and transfer estate real property as part of the estate administration. The sale follows the same disclosure requirements as any other residential sale. If the estate is still in probate, the sale may require court approval depending on the terms of the will or the nature of the probate proceeding. In practice, most sales by executors can close without additional court involvement if the executor has letters testamentary granting full authority. An estate attorney can confirm the specific authority under the applicable will and probate filing.

My house is in a Memphis flood zone — does that automatically mean I need a cash buyer?

Not automatically, but it narrows your buyer pool. A buyer using federally-backed financing in a FEMA Zone AE property must carry flood insurance, which raises their monthly carrying cost. Some buyers will walk when they get the flood insurance quote. Others will adjust their offer price down to account for the ongoing cost. A cash buyer who has already accounted for the flood zone will not reprice after contract. If the flood insurance cost eliminates the typical financed buyer in your price range, you are functionally working with a smaller buyer pool that behaves more like cash-adjacent buyers anyway. The cleaner path on a flood zone property with other issues is usually a direct cash sale.

What to do next

If your house has conditions that would fail a lender’s appraisal, carries an open permit in Davidson or Shelby County, is part of an estate, or simply needs more work than you have the money or time to complete, the first step is getting a number. Request a cash offer from us — there’s no obligation and we don’t pressure people into decisions. The offer we give you is based on the ARV formula, not on what we think we can talk you into accepting. Once you have that number, you can compare it against what an agent estimates you’d net after commissions, concessions, and carrying costs on the MLS. That comparison, not a sales pitch from either side, is what should drive the decision.