Updated August 14th, 2019
Whether you’re going through a divorce, moving for a new job, or simply don’t want to deal with the often lengthy home selling process, iBuyers like Opendoor and Offerpad are a good option for selling homes fast. These expedited real estate services can help sellers close on their homes for a cash payment in as little as 10 days.
Although these services provide a huge convenience, they come at a premium. While traditional real estate agent commissions typically max out 6% of the closing price, iBuyers charge up to 14% in service fees. In many cases, an experienced agent can aggressively market your home to cash buyers and also receive fast offers — sometimes in a matter of hours.
Make sure you’re not overpaying for speed by consulting a local agent and discussing how quickly they can sell your home.
Get connected with a top agent to have a no-obligation conversation about the best way to sell your house quickly.
In the meantime, this guide will go over the pros and cons of Opendoor and Offerpad, and provide you with some alternatives to consider.
Overview of Opendoor
Opendoor provides sellers with a quick cash offer upon request. If the seller accepts their offer, they can close on their home in as little as 10 days in some markets. Here’s how the process works:
How Opendoor Works
- Request an offer online: After making a request for an offer, Opendoor will provide you with a cash offer within just 24 hours. Once you’ve thought it over, you can either accept and move forward, or decline to sell. Although you can’t negotiate on the price, if you think they’ve missed an important feature of your house, you can request a re-evaluation.
- Have your home assessed: Once you accept the offer, Opendoor will send a representative to your home to perform an in-person assessment. If anything needs to be fixed, they’ll take the repair costs out of the sale’s proceeds.
- Close on the home: When the assessment is finished, you can set your own closing date. This can be in as little as 10 days. At closing, you’ll pay a 6-14% Opendoor service fee plus traditional seller closing costs.
For buyers, the Opendoor process is basically the same as any other real estate transaction. Find a home you like, visit it, and negotiate a price.
> Learn more about how Opendoor works here.
Pros
- Get an offer within 24 hours: Sellers just need to provide some basic information about their home to get an offer. The company’s proprietary algorithm and team of real estate experts will do all the heavy lifting as far as pricing is concerned.
- Avoid making repairs: You won’t need to hire an inspector or make pre-sale repairs when selling to Opendoor. The company performs its own assessments, and if they find any issues that need fixing, they’ll deduct the repair costs from your proceeds.
- Close on your home quickly for cash: If you sell your home to Opendoor, you can set your own closing date and close in as little as 10 days. Opendoor will pay the closing price in cash.
Cons
- 6-14% service fee: While the commission fees for traditional realtors are around 6%, Opendoor will charge anywhere from 6-14% of your home’s closing price in service fees in exchange for their quick process.
- You can’t shop around or repairs: Although Opendoor’s in-house assessment and inspection team can be convenient, since Opendoor simply deducts the cost of any repairs they deem necessary from your proceeds, you can’t shop around for the best-priced contractors. As such, you could easily end up overpaying for repairs.
- Offers 10% or more below market value: Opendoor makes money by purchasing houses at lower prices and reselling them for more. Opendoor has been known to make offers 10% or more below fair market value.
- Only available in 20 U.S. metro areas: Opendoor only operates in 20 U.S. metro areas. If you are located outside of this area, you cannot use the service.
Opendoor Reviews
As of August 2019, Opendoor has a A+ rating from the Better Business Bureau. There were 38 complaints closed in the last 3 years, and 32 complaints closed in the last 12 months.
Opendoor has a 3.6 average consumer rating based on HighYa based on 184 reviews as of August 2019.
Overview of Offerpad
Offerpad follows the same business model as Opendoor with a few minor variations. For one, the service fees are lower, ranging from 6-10% instead of 6-14%. Offerpad also gives sellers more options when it comes to repairs.
Once Offerpad has assessed your home and decided on repairs, you can either have them deduct the costs from your proceeds or pay for the repairs yourself, which allows you to shop around for the best price.
How Offerpad Works
Here’s the process of selling your home to Offerpad:
- Request an offer: After making a request online, you’ll receive in offer within 24 hours.
- Accept or decline: If you are pleased with the offer, you can accept the offer and move forward. If you are not pleased, you can decline.
- Have your home inspected: If you accept the offer, an Offerpad representative or a third-party inspector will perform a home inspection to determine if the home needs repairs. You can then deduct the costs from your price or pay to have the repairs completed.
- Close: After the inspection, you’ll pick a closing date. Upon closing, you’ll pay 6-10% in service fees to Offerpad plus traditional seller closing costs.
> Learn more about how Offerpad works here.
Pros
- Fast cash offers: Sellers receive offers within 24 hours.
- Choose your closing date: Sellers can close on their home within just 10 days in some markets.
- More options for repairs: Sellers can make repairs on their own. This means they can shop around for the best price instead of having Offerpad decide on a price for them.
Cons
- Offers below market value: Offerpad makes money by buying homes for under market value and reselling them for higher prices. As such, you may not receive as much as you would on the open market.
- High service fees: Offerpad service fees range from 6-10% with the average service fee being 7.5%.
- Only available in 12 metro areas: As of August 2019, Offerpad only operates in 12 U.S. metro areas.
Offerpad Reviews
Offerpad has an A+ rating from the Better Business Bureau as of August 2019. There were 30 complaints closed in the past 3 years and 21 complaints closed in the last 12 months.
On Sitejabber, Offerpad has a 1.4/5 star rating based on six reviews as of August 2019.
Overview of Clever
Clever connects sellers with top-rated, full-service real estate agents nationwide. Clever Partner Agents help sellers get the best possible deal on their homes in a short time by competitively pricing their properties, aggressively marketing them, and negotiating a fantastic deal on their behalf.
If you absolutely need to close in 10 days, Offerpad or Opendoor is a great option. But if you can wait a little longer, you’ll walk away with a lot more money.
How Clever Works
Clever puts sellers in touch with top-rated, local real estate agents who offer their listing services for a flat fee of just $3,000 or 1% of the closing price if the home sells for over $350,000.
As of August 2019, the median home value of a U.S. home is $227,700. By listing a similarly priced home with a Clever Partner Agent, you’d pay a $3,000 listing fee plus 3% to the buyer’s agent for a total of $9,831. That means a savings of $22,047 compared to an iBuyer. Plus our Partner Agents have the experience and local knowledge to get you an offer faster than average.
Pros
- Save on fees: Whereas Offerpad and Opendoor charge 6-14% in service fees, the most you’ll pay with Clever is 4% in commission fees.
- Sell your home for more: Since Partner Agents aren’t looking to resell your home for a profit, they strive to get you the best possible price.
Cons
- Longer selling process: Unlike selling to an iBuyer, unless you sell to a cash buyer, you’ll have to go through a typical closing process of about 30 days.
Clever Reviews
As of August 2019, Clever has a 5-star-rating rating on Trustpilot based on 214 reviews.
Weighing Your Options
When deciding which real estate service to use, it’s important to weigh these three factors:
Fastest Sale
If selling your home fast is your top priority, Offerpad and Opendoor are the clear winners. Both of these services can close on your home in just 10 days in some markets.
Most Affordable
Selling with a Clever Partner Agent saves you more money than Offerpad or Opendoor. Because of their reduced commission, you can save tens of thousands of dollars with a Clever Partner Agent.
Availability
Collectively, Opendoor and Offerpad only buy homes in a total of 20 metro areas, meaning they’re not an option for many Americans. Clever, on the other hand, has Partner Agents nationwide.
Find out more about your options for selling your home quickly. Fill out this form or call 1-833-2-CLEVER for a free, no-obligation consultations.
Top FAQs About Opendoor and Offerpad
Does Opendoor pay a fair price?
Opendoor pays below market value for homes, but given their quick sales process, many sellers find the price a fair exchange. It’s the best price they could expect for a sale that closes in 10 days.
Will Opendoor pay closing costs?
Opendoor does not pay closing costs. Sellers working with Opendoor will be responsible for the service fee and all other seller closing costs such as transfer tax, title insurance, repairs, and escrow fees.
Offerpad does not pay closing costs either. Just like Opendoor, sellers will need to pay the service fee and all other miscellaneous expenses associated with closing on a home.
Does Offerpad negotiate?
Offerpad negotiates with buyers, but not sellers. However, sellers can request that their home be reassessed if they believe Offerpad overlooked an important feature.
Opendoor follows the same model. They will negotiate with buyers and reassess your home, but they will not engage in traditional negotiations.
