Are you looking to sell your home quickly? Perhaps you’re considering two popular options – Open Door and a Cash Home Buyer, like Quick Fix Real Estate. It’s important to understand the differences between the two. This article explores Open Door and Cash Home Buyer Offers – A Comparison for your information and hopefully your benefit.
Restrictions on Selling to Open Door
One of the main advantages of selling your home to Open Door is the speed and convenience of the process. However, there are some restrictions to keep in mind. First, you must have clear ownership of the property. Additionally, Open Door will not present an offer for your home if it is a mobile/prefabricated home or located in a flood zone.
Open Door also has restrictions based on the materials and conditions of the home. For instance, if your home has foundation issues, fire/flood damage, asbestos siding, solar panels, or a well and septic system, it may not be eligible for sale to Open Door.
While Quick Fix Real Estate will also shy away from homes that are just total losses, the ability to make an offer can be less restrictive. Some of the items that Open Door will outright decline to work with are things that (with the right property, location, and agreed offer amount) may be worthwhile to a cash home buyer.
Closing Costs and Service Charges
If you sell your home to Open Door, you’ll still have to pay 50% of the closing costs. While Open Door’s pricing page assumes that seller closing costs will be only 1%, they’re typically 1-3% of the sale price. These costs include title fees, transfer taxes, and prorated property taxes. And remember this, the Open Door offer is NOT guaranteed, and they state in their contract that they can back out at any time, even the day before closing.
In addition to closing costs, Open Door’s service charge is typically between 5% and 6% of the sale price. This is higher than a traditional real estate agent’s commission, which is usually around 5%-6% of the sale price. So, with Open Door that initial offer? It’s not the true offer, it’s the estimate that has a lot of “if” built into it. With the cash buyer, specifically Quick Fix Real Estate, the original and agreed upon offer is a guarantee not an estimate.
Comparing Open Door to Cash Home Buyers
Compared to Open Door, cash home buyers, especially Quick Fix Real Estate, offer a more straightforward process with fewer restrictions. Cash Home Buyer does not have the same restrictions on home materials and conditions that Open Door has. As long as you have clear ownership, you can sell your home to Cash Home Buyer.
In addition, Quick Fix Real Estate does not charge any fees or commissions. They will buy your home as-is, which means you won’t have to pay for any repairs or renovations. This can be great news for you if your home requires significant repairs or upgrades in order to attract traditional buyers.
However, it’s important to note that a cash home buyer may not be able to offer as high of a sale price as Open Door. Since Quick Fix Real Estate does not charge any fees or commissions, they may offer a lower sale price to account for their costs.
That means you really need to pay attention to the Open Door offer. The initial offer will always be higher than their final offer. Why? Because in the final offer is where they account not only for the service fees, but now they add in real cost of repairs and your part of the closing cost. This can be thousands of dollars less! Basically, at Quick Fix Real Estate the day of the assessment you will get the offer. Is it open to some negotiation? Yes, but with a cash for home buyer the offer won’t change upon acceptance.
FTC Settlement with Open Door
As a consumer you should educate yourself on recent developments when comparing Open Door, and its practices as an ibuyer, to a professional cash home buyer. In August 2022, Open Door settled a lawsuit with the Federal Trade Commission over allegedly misleading customers about its true home sale costs, including repair fees. According to the complaint, the vast majority of consumers who sold to Open Door actually lost thousands of dollars compared with selling on the traditional market, because the company’s offers have actually been below market value on average and its costs have been higher when compared to what consumers usually pay when using a real estate professional.
As part of that settlement, Open Door was required to pay $62 million to the FTC, which is expected to be used for consumer compensation. So, while Open Door can be a viable option for selling your home, it’s critical to carefully consider the costs and risks associated with the company.
Selling your home can be a stressful and time-consuming process, but options like Open Door, or working with Quick Fix Real Estate as a cash home buyer, can offer a convenient alternative. The time frame to sell is going to be comparable (sometimes just 7 days with Quick Fix), it’s important to consider the restrictions, closing costs, and service charges associated with the company. A cash home buyer offers a more straightforward process with fewer restrictions and no fees or commissions, but may not offer as high of a sale price as Open Door (but remember, those fees and closing costs can be thousands of dollars too!). Ultimately, the choice between Open Door and Quick Fix Real Estate depends on your priorities – an initial offer that could be a little higher but is subject to fees and closing costs; or a straightforward process that can be done in as little as 8 days if you need to sell my house fast Charlotte.