Deciding to sell your home is life-changing. Most people invest a tremendous amount of time, money, and emotional energy into their home, so selling is often difficult, particularly under time constraints. OfferPad is a direct home buying service that claims to ease the difficulties of selling a home in various ways. While relieving some of the stress associated with selling a home is tempting, it is important to recognize both what is good and bad about using OfferPad to sell your home.
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How Does OfferPad Work?
OfferPad provides a streamlined home selling process which cuts out traditional hassles associated with finding a buyer. The first step to selling your home through OfferPad is requesting a purchase offer. To make the request, you will need to provide some information about the property and upload a few pictures of the home.
After you make a purchase offer request, OfferPad should respond with the offer via email within 24 hours. Following receipt of the purchase offer, you then decide whether or not to accept. If you decide to accept, you’ll then select a closing date within 5-90 days of acceptance and sign a purchase contract. Before selling your home, you will need to schedule an inspection where an OfferPad employee and an independent inspector will survey the home for needed repairs. If repairs are necessary (which they often are) you are presented with three options:
- Have the cost of the repairs deducted from the purchase price
- Hire a licensed contractor to make the necessary repairs
- Cancel purchase contract
There are a few more steps after the home repair process:
- Getting your home ready for moving out
- OfferPad sends an employee to make a final walkthrough two days before closing
- Official close of escrow
- Moving out
Related: How to Price Your Home: 5 Rules for Selling a House
OfferPad vs Real Estate Agents
When you sell your home with OfferPad, you are dealing directly with your buyer. When you sell your home using a real estate agent, you are working with a person who makes a percentage of your home’s sale price. A real estate agent charges a 6% commission off of the value of your home plus title and escrow fees. OfferPad charges the same 6% commission plus an additional 3% convenience fee. Additionally, OfferPad can include the hidden fee of offering less for your property.
Whether you use a real estate agent or a direct home buyer, most people must repair their home before sale which is a context-dependent expense that can vary wildly. If you sell with OfferPad repair costs may be higher than if you sell with a real estate agent because OfferPad requires either:
- A deduction of repair costs from the purchase price
- You hiring a licensed contractor to make necessary repairs
When selling traditionally, you can take more cost-effective measures to make required repairs.
“My inspector said that the inspection repairs would be about $25k, and I have used him for years and trust him, never steered me wrong. OfferPad said that their inspector in Vegas had looked at the inspection report I included and said it would only cost $2000! That’s a pretty big difference that could come back on a home seller or homeowner.”
Pros & Cons to Using OfferPad to Sell Your Home
Selling your home through OfferPad is relatively quick and easy but comes at a cost.
Pros:
- Convenience
- Save time
- No initial commitment
- No moving cost
- No title and escrow fees
Cons:
- Inflexible sale price
- Can easily hide fees
- May increase repair costs
- May refuse to make you an offer
- Cannot set asking price
When You SHOULD Use OfferPad
OfferPad is a great home selling service for people that need to sell fast and are willing to pay for speed and convenience.
Related: Selling Your Home: 11 Things to Do Before Listing Your House
When You SHOULDN’T Use OfferPad
If you are interested in maximizing your sale price, OfferPad is not for you. A direct home buying service views your property as an investment and is looking to acquire your home and sell it for maximal profit. For most people, a house is the largest investment they will make in their lives. For that reason, maximizing sale price is often more important than paying for convenience. If you want to maximize your sale price, finding a trusted REALTOR that will work with your interest in mind is the ideal way to go about selling your property.
Using traditional means to sell a home can be difficult, and OfferPad provides a quick and easy alternative. If you are considering using OfferPad to sell your home, it is essential to recognize that you are paying for convenience. A direct home buying service is an excellent tool for people that need to sell fast and are willing leave money on the table to do so. If you aren’t in a rush or if you’re more interested in maximizing your property’s sale price, using an agent is the way to sell.
