My experience with Quick Close companies

by Amelia | Sep 4, 2019

I know Quick close companies are all the rage right now, Open Door, Zillow Offers, Offer Pad, Homie and More. (We refer to them as iBuyers). They can be a Great option in certain circumstances and I am always happy to offer that for the right circumstance.

A few things I will touch on:

Who offers what-Expectations
Customer Service
Why you should STILL use a REALTOR®

The Circumstance:

Zillow offered = $211,000

Open Door = $209,500

Offer Pad = $209,000

Listing Price would have been $217,000

Open Door and Offer pad Require you to be under Contract in order to have inspection. Zillow does Not. So We started with Zillow, they were quick to schedule inspection. Very efficient and helpful. Adult needed to be present. They inspected everything. All 3 companies have a FEE of about $12,000. Listing commission of 5% would have been $10,700. But we needed a Quick sale to buy the home we ALREADY had under contract with a Buyer contingency on the sale of their home.

Zillow came back with about $15,000 in repairs. The home is in decent condition, Very clean. New Roof, New AC, Recent Floors, New water heater, New Exterior paint, Granite Counters, Stained Cabinets. (It was in need of some master Bathroom Love though.) And there is popcorn ceilings still remaining…. Needless to say we were surprised. I expected $4,000 or $5000 in actual repairs and thought they might quote around $8000 (because they can). $15,000 ruined the bottom line for my clients as we needed to BUY a new home! So that was not going to work…

I did my research and went and visited Zillow homes for sale on the market. They are wonderfully remodeled. Attention to detail and invested in (Okay I understand why they nitpicked). Looking into Open Door and Offer pad, Their homes have a lower standard on the remodels. Painted counter tops, Resurfaced bathtubs and showers to make them look fresh. They don’t always replace carpet or Paint unless “Needed.” They do more of a “Lipstick” remodel than actual remodel like Zillow does.

For those watching the numbers:

Now WHY would anyone choose a Quick Close company over Traditional Sale and Lose all that profit?

Everyone has their own reasons but sometimes it is due a need for a fast close and a quick move, other times it is due to a life circumstance. No matter the reason we can always talk about what option is best for you and YOUR Circumstances.

Now back to this situation, Zillow was far lower than expected so we turned back to Option B: Open Door and Offer Pad. The Offer pad Offer had expired and I had to submit a new request. For Open Door we had to accept contract (We can cancel at any time) in order to schedule inspection for a week later. (NOT prime considering our Quick Close Timeframe)

Offer pad reached out a few days later with the same offer, but also required we be under contract to schedule inspection. (You can only be under contract with 1 Buyer at a time, so we had to wait.) Offer pad did offer a higher price if we would cancel Open Door and schedule inspection with them….We considered but decided to complete inspection with Open Door First.

Open Door then did inspection and returned rather quickly with a response which was this:

“Dear Homesellers,

We mis-valued the price of your home. It should be valued at $16,000 less than we originally offered. Because this was OUR error we are going to give you a $10,000 Credit and Only ask for a $6,000 Debit from you and NOT charge you for any repairs.

Regards, Open Door”

Now this is paraphrased, but it was indeed their response. Now they had told us once inspection came back we could do some of the repairs ourselves for a credit to repairs (If repairs were $3,000 and we did $1,000 they would change the “repairs needed number” to $2000) Without them charging us for repairs we could no longer shorten that gap ourselves.

That was not the only thing that didn’t work for us. The value WAS already correct, there was no need to deduct $16,000. WHICH brings me to my NEXT point.

WHY YOU SHOULD STILL USE A REALTOR….

As a Real Estate Wealth Manager I then went to work. Used my negotiating skills, sent them proper comps, consulted with my Appraiser, and got them to agree to let us do the repairs to narrow the Gap by $1500! This was NOT easy. I managed to get the Bottom dollar to above $190,000 which was the goal. $8,000 above what we would have gotten if we would have settled for the quick easy route but still $8,000 less than if we would have had the proper time to list and sell on the Open Market.

Now in order to have tried Offer Pad we would have had to cancel the contract with Open Door and go with them HOPING for the best. I cannot comment on their process past scheduling inspection at this time. I have not submitted any offers to Homie or Knock.

My Takeaway:

I work with Clients every day in different scenarios. I have investors who are interested in buying your distressed home, I work with Contractors to help you fix up your home to List for Traditional sale, I work with Open Door when it suits the situation. I do whats BEST for my clients, even when they don’t pay as well.

PLEASE ALWAYS CONSULT A REALTOR BEFORE SELLING YOUR HOME TO ANYONE!

Same as you would consult a Technician before trashing your Computer….

Consult a Mechanic before dumping your car…

Your DR. before taking a prescription…..

We are specialists for a reason, Here to serve you!