An estimated 70 percent of seniors will need long-term care at some point in their life. But, just 35 percent of Americans over the age of 40 have started saving money for their long-term needs, leaving many older adults worried about how to pay for their senior care. To make senior living fit their budget, some people decide to sell their home or conduct an estate sale before transitioning to a senior community.

While selling one’s home via the traditional route can eventually provide seniors with the funding they need for senior care, the process can be long-drawn-out. Selling one’s estate through an estate liquidation company can be a good option for seniors who need cash-in-hand to finance a move to a senior living community but don’t have the time, energy, or desire to withstand the lengthy selling process. 

Estate sale services can make the process of selling one’s home and belongings easier and quicker, but it is not the right choice for all seniors. We created this guide to help seniors better understand estate sales services and their costs, benefits, and downsides. We also provide guidance on selecting an estate sale company to ensure you work with a reliable and trustworthy service. 

What Are Estate Sale Services?

What Are Estate Sale Services?

Estate sale services are companies that can manage and operate all aspects of selling one’s estate, taking the burden off of the homeowner to handle those tasks themselves. An estate liquidator can handle the entire estate sale process including taking inventory, appraisal, cleaning one’s home, and the home sale process. These “turnkey” estate sale services that do complete estate buyouts can be particularly appealing for seniors who are ready to relocate to a senior living community but do not have the time, expertise, or desire to manage their estate sale independently. Estate liquidators may also manage just one part of the estate sale if the homeowners wish to do the rest themselves. 

While using an estate sale service for an estate buyout can certainly make the moving process easier, it does come at a price. Typically, estate sale services do not charge a flat or hourly fee. Rather, the appraiser will determine the value of your entire estate- including items in the home and the home itself- and take a portion of the estate’s estimated value as their fee, usually in the range 25-40%. You as the estate owner receive the rest of that sum. Thus, you only receive a portion of your estate’s value.

It’s imperative to consider the tradeoff of having someone else handle your estate and having cash in hand versus selling your estate on your own and retaining all of your estate’s value. Seniors may choose to use estate buyout services despite the financial loss because it enables them to transition to senior living and avoid the stress of selling one’s estate and home.

What Are the Benefits and Drawbacks of Using an Estate Sale Service?

While estate liquidation can be a good option for some seniors, it’s not the right choice for everyone. Before entrusting your estate sale to a company, be sure to consider both the benefits and drawbacks of working with an estate sale service, especially if you’re considering a buyout. You may find that taking the traditional route of selling your property will ultimately better serve you in your situation. Keep in mind that the pros and cons listed below specifically apply to estate buyouts, but can also be true of traditional estate sales. 

Benefits of Estate Sale Buyouts

Sellers receive cash up-front. 

Seniors may choose to work with an estate liquidator when pressed for time to sell their estate. Indeed, one of the biggest benefits of working with an estate buyout service is that sellers receive cash up-front. For seniors who need to use the revenue from their estate sale to finance a move to a senior living community, having cash-in-hand can enable them to move on their own timeline rather than waiting through the process of selling their property. 

Estate sale services can make moving less stressful. 

Working with a full-service estate sale company means that seniors can leave the heavy-lifting to the experienced professionals. In some cases, homeowners don’t even need to clean their home before moving out– they can simply pack what they want to take and leave the rest for the estate liquidator to handle. Compared to the full process of selling one’s estate and moving, this option is likely to be much less taxing. 

Estate sale services can save seniors time and energy. 

Estate sales are a lot of work. Sellers must sort and catalog all of their possessions, and decide how much to charge for each item. When working with a service, estate owners can simply leave their possessions as-is when they move out. Plus, they don’t need to wait through the home-selling process to access the funds they need for their new residence.

Estate liquidators can help to maximize profits from your possessions.

For those who aren’t familiar with estate sales, knowing how to price certain items can be tricky. Experienced estate salespeople and appraisers will understand the resale market and know how to strategically price your belongings for maximum profit. However, keep in mind that the service will take a portion of your earnings from the estate, which may cancel out the increase in revenue.

Drawbacks

Though working with an estate sale company has its benefits, it isn’t the right choice for everyone. There are certainly some notable downsides to estate buyouts that need to be considered. 

Sellers may ultimately end up receiving less money from the sale. 

Especially when receiving a lump payment up-front, it’s important to note that the sellers are likely to end up with less money overall compared to if they sold their home and possessions independently. Whether intentionally or not, the appraiser could potentially underestimate the value of your property, and if you already received your payment, you most likely will not receive the additional funds.

Not all estate sale services are legitimate. 

While the actual estate sale process can be easier when working with a liquidator, sellers will need to do some legwork when it comes to researching and choosing a company. Because there is no national regulatory agency or certification standards for estate sale companies, consumers need to do thorough research to ensure that they choose a trustworthy and reputable service. Unfortunately, seniors who are less internet-savvy may fall prey to scams posing as legitimate estate sale services.

Alternatives to Estate Buyouts

Sometimes, seniors need accessible funds as soon as possible. In certain circumstances, waiting to sell one’s home through the traditional route simply is not an option. While estate liquidation is one way to access money quickly, it isn’t the only option seniors have for tapping funds from their estate.

  • Reverse Mortgages: These are loans homeowners can take out against their home’s value, essentially converting some of their home equity into cash without having to sell the home. Reverse mortgages are not a permanent solution, as the loan does have to be repaid with interest once the home sells, and there may be a time limit on repayment. But, reverse mortgages can provide seniors with the money they need in the short-term to finance their move without feeling rushed to sell their estate. 
  • Bridge Loans: Like reverse mortgages, bridge loans are short-term loans that use one’s current home as collateral. They’re typically used by individuals who find themselves in need of money while in the process of selling their current home and purchasing a new one. Bridge loans tend to have higher interest rates than other types of loans, so they may not be the best choice, but can provide some much-needed financial assistance for those who find themselves in a bind and who do not want to sell their home to an estate sale company. 

How Do I Choose an Estate Sale Service?

How Do I Choose an Estate Sale Service?

If you are interested in working with an estate sale service, you’ll find that you have plenty of options. According to the National Estate Sales Association, the number of estate sale companies has increased by 650% since 2006. With so many companies out there, it may take some effort to find one with which you feel comfortable. Below, we’ve outlined some steps you can take to find a trustworthy estate sale service. 

Ask Around for First-Hand Recommendations

The first step in the process is to ask your network for their recommendations. You may have friends, neighbors, or friends-of-friends with first-hand experience using an estate sale company. Ask around for suggestions and make a list of any companies that someone you know has had a positive experience with, and vice versa. Someone’s firsthand account can also prevent you from wasting time researching a company you want to steer clear of. 

If you’re conducting an estate sale to finance a move to a senior living community, ask community staff if they have any recommendations. Other residents have likely used an estate sale service before their move as well, and the community staff may be able to offer some insights. Some services even specialize in “senior relocation” or “senior move management.” If no one in your network has any recommendations, an online search will of course suffice. 

Check The Company’s Record and Reviews

Once you have a list of a few companies you’re interested in working with, it’s time to dig in and do some research. While there is no official certification program for estate sale services, there are some membership organizations like the American Society of Estate Liquidators and the National Estate Sales Association. Membership in one of these organizations does not guarantee a good experience with a company, but it can indicate that the service sees estate sales as a legitimate profession rather than a side business. Additionally, a quick online search of each company’s name will show if they’ve been involved in any major complaints or scams in the past. 

Some companies may also have a profile with the Better Business Bureau. On the BBB website, you can check to see if any complaints have been filed against the company and read client reviews. Whether you use the BBB site or another reviews website such as Google or Yelp, first-hand accounts from current or former clients are the best way to get a sense for what it’s like working with the company. When trying to narrow down your list of estate service companies, this step is not to be overlooked. 

Ask the Right Questions and Prioritize Transparency

At this step, you should have your list narrowed down to 1-3 of your top choices. Before making a final decision, it’s important to reach out to all of the companies and ask some important questions, including:

  • How many years have you been in business? Established companies are less likely to be scams or use unfair practices. 
  • How many estate sales have you conducted? A company that has conducted many sales will have more industry knowledge and have past experience to learn from. 
  • How do you advertise your sales? Estate sales typically must be widely advertised in order to be successful. Make sure the company has an advertising plan in place. 

These questions should be simple for any legitimate company to answer. If you’re talking to a company and it’s resistant to providing you with information about their history and experience, it’s wise to steer clear. 

Starting a conversation with companies you’re interested in is always a good way to get a sense for their communication style. You’ll be more relaxed throughout the process if you’re working with an estate liquidator with which you feel comfortable and get along.

Obtain Quotes and Make a Decision

The last step before you officially choose a company is to obtain a quote from your top choices. You’ll need to give the sellers an idea of what types and how many items you wish to sell to get an accurate estimate of your estate’s value, so be prepared to put together a list or invite the seller for a walk-through. Ask both liquidators for a written proposal with their estimate and how much money you can expect to make from the sale. In cases where you’re interested in working with two companies equally, one’s proposal or your estimated earnings may help you to make the final decision. 

Additional Resources

Like in any industry, there are some estate sale services, especially those offering estate buyouts, that may prey on seniors and try to scam them out of some of their money. These companies know that older adults who haven’t spent as much time online may not be privy to their tactics, and they take advantage of people looking into estate buyouts who may be pressed for time. 

The resources below can help seniors understand their home equity options, avoid online scams, and become overall more informed regarding their finances. 

ResourceDescription
National Council on Aging Economic Security GuideThe NCOA has many helpful resources for seniors on its website, including a section devoted to economic security. The Home Equity resources can be especially beneficial for seniors looking to sell their home, and includes information about housing options, reverse mortgages, and other home equity products. 
Avoid Estate Sale ScamsThis guide published by the Minnesota Attorney General focuses on avoiding untrustworthy estate sale companies and estate sale scams. 
California Bureau of Real Estate Tips for Seniors to Avoid Real Estate FraudCalBRE published this list of tips to help seniors protect themselves against targeted real estate scams. Though written specifically for California residents, almost all of the tips apply to seniors living anywhere. 
10 Things You Can Do to Avoid FraudThese tips from the Federal Trade Commission cover financial scams in general, not just online, but notes that new technology is often a factor in people falling prey to fraud. 
Money Smart for Older AdultsThe FDIC published this curriculum for seniors and caregivers to be able to identify and avoid financial exploitation and scams. The curriculum, developed by the FDIC in partnership with the Bureau of Consumer Financial Protection, is free for anyone to download. 

Frequently Asked Questions 

What Does an Estate Sale Company Do?

An estate sale company handles all aspects of one’s estate sale, including sorting items and taking inventory, appraisal and pricing, advertising for the sale, and conducting the sale itself. These companies tend to have industry experience and connections that may make the estate sale more lucrative. However, keep in mind that the companies do take a percentage of the revenue from the sale. 

What Is an Estate Buyout?

An estate buyout is when a company buys someone’s entire estate, including the home and all of its contents, for cash upfront. This enables sellers to access these funds without having to wait for their possessions to sell. This differs from a typical estate sale when neither the seller or the agent receive any money until after the home and items have sold. 

How Much Do Estate Sellers Charge?

Estate sellers typically do not charge a flat fee, but rather take a percentage of the sale revenue. Most services take between 25-40%, and the seller keeps the rest. Fees can vary between different companies, so it’s worth getting quotes from several services before signing on with one. 

How Do Estate Sales Work?

During an estate sale, all of the items in one’s home are tagged with a price. Interested buyers walk through the home and claim items they want to purchase, either by picking the item up or otherwise marking it. In the case of an estate buyout, the company pays the seller a lump sum in cash prior to the sale, based on their appraisal and estimated value. 

How Do I Find a Reputable Estate Sale Business?

To find a reputable estate sale business, it’s crucial to do thorough research. Look for consumer testimonials, both good and bad, and check the company’s history on the Better Business Bureau to see if they have had any complaints filed against them. Also, be sure to ask the company about its history, experience, and methods before signing any contract. Unfortunately, some illegitimate and scam companies out there prey on people trying to sell their entire estate on a tight schedule, so it’s imperative to do your due diligence before signing any contract.