Offerpad Fees: How to AVOID Hidden Costs

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By Katy Byrom Updated October 16, 2023

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Offerpad fees | Repair costs | Hidden fees | Offerpad vs. other iBuyers | Can you negotiate with Offerpad?

When you sell your home to Offerpad, you can expect to pay a minimum of 8–11% of your home’s final sale price in fees and related costs.

Part of the cost is the 5% service fee that Offerpad charges — the equivalent of what you'd pay in realtor commissions selling on the MLS. However, Offerpad's offer will likely net you a lot less money than you'd get selling with an agent.

In addition to its service fee, Offerpad deducts repair costs following its home inspection, which some customers complain are unreasonable. You also pay typical seller closing costs, usually ~1%, and a cancellation fee of 1% if you back out after accepting Offerpad's offer.

"Before you sign anything, get a second opinion," advise realtors Barry and Rebecca Richards, who have both represented homeowners in transactions with iBuyers. "You're going to get the most money when you have people competing against each other."

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How much does Offerpad charge?

💰 Service fee 5%
📁 Closing costs 1–3%
🛠 Repair costs 1–2% minimum
❌ Cancellation fee 1%
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Should you consider an offer from Offerpad?

There's no harm in finding out what Offerpad might offer for your home. But before selling to Offerpad, we strongly recommend comparing its offer with cash offers from other iBuyers like Opendoor and local investors. You should also have an idea of what your home could be worth on the traditional real estate market.

You can solicit cash offers on your own, or you can use a free service like Clever Offers to do it for you.

With Clever Offers, you get multiple offers from reputable cash buyers, including iBuyers and investors. You can also request a free, professional home valuation, so you can compare the offers with what your house could sell for on the open market.

You might be surprised by the options available. For example, if your home needs work, some investors will cover the repair costs upfront and split the proceeds with you when your home sells — helping you maximize your home's potential value.

How do Offerpad fees compare with top competitors?

At 5%, Offerpad’s service fee is comparable to the commission you'd pay a traditional agent. Its service fee is also on par with its top competitor, Opendoor, charges. However, Offerpad tends to offer more perks, such as free local moves and a grace period if you need a few extra days to move out.

» READ: Offerpad vs. Opendoor

In addition to service fees, you need to consider the actual sale price of your home. While Offerpad's initial offer may seem reasonable, Offerpad reviews reveal that the company's initial cash offer drops significantly after it completes its home inspection.

For example, Bradley Carpenter of Kansas City recalls accepting what seemed like a fair offer from Offerpad in 2022. But after the inspection, Offerpad lowered its offer by $40,000. He ended up selling his home to Opendoor, which charged him only $7,000 in repair fees.

How much does Offerpad charge for repairs?

When you sell your home to Offerpad, repairs are the biggest variable. They’re hard to predict and can reduce your net sale amount by tens of thousands of dollars.

In any sale, it's normal for buyers to negotiate over repair credits. Based on an inspection, buyers identify repairs they want and then request a discount equivalent to the estimated cost of fixing those items.

» JUMP TO: Can you negotiate with Offerpad?

The same is true with Offerpad. When you accept Offerpad's initial cash offer, the company will send a third-party home inspector to your home to evaluate its condition.

In a traditional real estate transaction, you can negotiate the cost of repairs with the buyer or simply reject any repair requests altogether. The buyer can choose to pay for the repairs themselves, keep negotiating, or walk away.

Repair credits work differently with Offerpad. Instead of negotiating the cost of repairs, Offerpad gives sellers two options:

  • Agree to provide a repair credit, which deducts the full cost of repairs from Offerpad’s cash offer
  • Hire a contractor to complete the repairs to Offerpad’s specifications

In a seller's market — one where the demand for homes outpaces available listings — you may be well positioned to sell your home without having to make repairs or concessions.

Or, if you're willing to shop around, you can often find an investor or even a realtor who's willing to complete the repairs upfront, then deduct their costs and any additional agreed-upon amount from the proceeds when you sell. That way, you can maximize your home's value without paying out of pocket for needed repairs. 

In either case, you'd probably earn more from the sale than you would selling to Offerpad.

A hassle-free way to compare your options

With Clever Offers, you can compare up to 10 competitive offers from local, regional, and national cash buyers — with no added fees or commissions.

You'll get a professional home valuation to help you make an informed decision and a dedicated point of contact to help you navigate the offer process. Simply tell us a bit about your home, and we'll do everything we can to ensure you get the best possible offers.

Clever Offers is free, and there’s no obligation to move forward.

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Offerpad reviews about repairs

Offerpad has a weighted average rating of 4/5 stars based on ~2,400 reviews across sites like Google, Trustpilot, and the Better Business Bureau. Despite the moderately high rating, complaints about repairs are common.

Some sellers are disappointed when Offerpad adjusts their offer — sometimes dropping it by thousands — following the home inspection.

Angela G. 1 star. Offerpad provided us with an offer to purchase our home at about $2K less than our realtor suggested as fair market value. We knew we would gain less on the sale because of the higher commission and

Other sellers found that Offerpad charges surprisingly high repair fees — which they learned when contractors offered work at a fraction of the price.

Tara D. 1 star. DO NOT USE THIS BUSINESS. SHADY BUSINESS PRACTICES, UNPROFESSIONAL, There is something to be said too good to be true. I thought taking a little lower price, getting to pick my closing date, and getting a free move was worth it TILL the inspection process. There were many red flags so if you are reading this DON'T USE THEM. I WISH I read these reviews before. They take unnecessary deductions out of their low price to begin with and if you don't agree with their repair cost they are deducting

Additionally, some buyers who purchased homes from Offerpad reported major issues with the quality of Offerpad's repairs.

Annie P. 1 star. We bought a house from Offerpad and here's our buying experience on the following areas: communication, negotiation, repairs, lending, title, and closing. I'll review Offerpad Lender Loandepot first because this will be long and the lending process was so horrid followed by repairs. How's the home? On the surface it looks great but if you look at it closely, it has poor workmanship on any improvements. Leak where they were supposed to fix with black mold growing that costs us thousands to fix, paint drips everywhere on the cabinets, patch up work are easily identifiable, exposed wall plumbing under the sink, chipped and broken windows, condensated windows, rotted fence, sprinkler system not working, garage door patched up with plywood, leaked and etc... Don't go to the attic or you will find many horrifying code violation such as exhausts vents tied together with electrical tape, vent taped with duct tape and etc after they had fixed it. We spent thousands of dollars on repairs on a move in ready home because of their negligence. Source: Yelp (excerpt)

Still, some customers do feel Offerpad's repair costs are fair. For example, one seller knew their home's major systems were outdated, so there were no surprises when Offerpad requested some big ticket repairs.

Nathan R. 5 stars. After stumbling onto a property deal I couldn’t pass up, I needed to sell my house quickly with little to no risk. The offer from Offerpad was competitive with other companies but I chose them based on their response to my inquiries. I knew the roof and AC would be replaced due to simple age and expected to eat it on my equity so there were no surprises. There were some slight negotiations but we quickly came to a mutually beneficial agreement. Everything they said they would do was done and the roof and AC were replaced before going to market. No complaints here and I have recommended them since. <em>Source: Better Business Bureau</em>

» READ: Our in-depth Offerpad review

Does Offerpad charge hidden fees?

Most Offerpad fees are transparently listed on its website, though it’s not obvious that the company charges a 1% late cancellation fee.

When Offerpad provides the initial cash offer, the seller must sign a purchase agreement before the deal can proceed to the inspection stage.

This is when it gets tricky. When Offerpad provides the inspection report, it will also provide an updated cash offer that reflects the repair credits, which some sellers claim lower the sale price by as much as 20%. 

At this point, you'll have four days to consider Offerpad’s final offer. It's a tight turnaround, especially if you want to get a second opinion from a contractor or inspector. During this window, you can:

  • Accept the offer and agree to the repair credit
  • Negotiate over the repair credit
  • Reject the offer and walk away

But if you decide to back out AFTER this four-day window, you'll be subject to a cancellation fee: 1% of Offerpad’s initial cash offer.

Are closing costs included in Offerpad fees?

No, Offerpad's service fee does NOT include closing costs. You should set aside 1–3% of the sale price to cover these expenses.

Closing costs vary by location but are typically shared by the buyer and seller. In general, sellers pay administrative fees, transfer taxes, and title insurance.

How much do Offerpad's extra services cost?

Offerpad has two main options for home sellers: Offerpad Express and Offerpad Flex.

Offerpad Express is its traditional cash offer program, which allows you to sell your home directly to Offerpad and choose your closing date. With Offerpad Flex, you list your home the traditional way with an agent Offerpad assigns, and you use the cash offer as backup if your home doesn't sell within your desired timeframe.

You pay the 5% service whether you choose to accept Offerpad's cash offer right away or use it as a backup while listing with an agent through Offerpad Flex.

If you decide to sell to Offerpad, you can take advantage of several perks at no additional cost:

  • Extended Stay. Offerpad allows you to stay in your home for up to three days after closing. Offerpad would hold $3,000 of your proceeds as a security deposit, to be refunded after you move out.
  • Local Move Program. If you’re moving within a 50-mile radius, Offerpad will pay for your moving services. The company partners with local movers and will pay them directly to move homes up to 2,800 sq. ft. You'll be responsible for the packing and any additional costs, such as extra insurance for expensive items.

Can you negotiate with Offerpad?

Yes — according to Offerpad, sellers can negotiate the offer price and repairs. However, the reality is that Offerpad is unlikely to budge on either. In general, you'll have much more room to negotiate if you list your home on the open market.

You'll have a better shot at successfully negotiating with Offerpad, though, if you’re armed with information. Recent appraisals, inspection reports, and maintenance reports can help you make a stronger case for a higher offer or lower repair credit.

When it comes to repairs, gather as much information about your home as possible ahead of time. For example, if Offerpad suggests installing a new roof, but you have documentation showing that your roof isn’t due for an upgrade for several years, you may be able to successfully push back.

You have much more room for negotiations when selling your home with a real estate agent — especially if you work with a company that's already negotiated commission savings on your behalf.

» MORE: The best low commission realtors and brokers

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