Offerpad Reviews: Is the 1% Cancellation Fee For Real?

✏️ Editor’s Note: Realtor Associations, agents, and MLS’ have started implementing changes related to the NAR’s $418 million settlement. While home-sellers will likely save thousands in commission, compliance and litigation risks have significantly increased for sellers throughout the nation. Learn how NAR’s settlement affects home sellers.

Offerpad makes cash offers for homes in just 24 hours. The company calculates the preliminary offer using advanced machine-learning technology and human expertise.

However, for this speed, you might have to compromise on the price. You may get 70% to 80% of your home’s Fair Market Value. Additionally, the repair and closing costs are deducted from their final offer.

In case you decide to back out of the agreement, there will be an additional cancellation cost of 1%.

✍️ Editor’s Take: We recommend listing your home on the MLS via Houzeo. Houzeo’s platform helps you get multiple cash offers. Moreover, the platform also helps to manage multiple offers. Compare Offerpad vs. Houzeo.

Is Offerpad Legit?

Yes, Offerpad is a legitimate company based in Phoenix, Arizona. The company was founded by Brian Bair and Jerry Coleman in 2015.

Following in the footsteps of Opendoor, Offerpad launched Offerpad Express. The company’s vision was to provide home sellers with quick cash for homes. In the second quarter of 2023, Offerpad acquired 840 homes and sold 650 homes.

Offerpad operates in 1700+ cities in 14 states and holds real estate brokerage licenses in multiple states.

Will Offerpad Go Bankrupt in 2025? Watch the Video to Know More

How Does Offerpad Work?

Offerpad is essentially a house flipper. They purchase homes at discounted price and sell them for a profit.

However, they only buy properties that meet their strict eligibility criteria.

Process of Selling to Offerpad

Here’s how Offerpad works:

1. Request an Offer: Fill out a form on Offerpad’s website. Provide property details and attach photos of your home.
2. Evaluate Your Cash Offer: Within 24 hours, Offerpad generates a preliminary offer for your home using proprietary algorithms and expert analysis.
3. Sign the Purchase Agreement: You have 4 days to accept or reject Offerpad’s offer. If accepted, you have to sign a purchase agreement. Note, that Offerpad doesn’t disclose the final offer price at this stage.
4. Complete the Inspection: Once the offer is accepted, Offerpad schedules a home inspection. The inspector assesses water damage, structural issues, and general wear and tear.
5. Receive the Final Cash Offer: You will receive the final offer. You have 4 days to decide whether to accept it.

If you need more time, you can use their Extended Stay Program. With this facility, you can move out in 3 days after your closing date at no extra charge.

Additional Offerpad Services

Here are some additional services Offerpad provides, depending on your location.

• Offerpad Brokerage: You can work with an Offerpad agent to get all the services. Like a traditional brokerage, you will receive all the assistance you need with Offerpad Realty.
• Offerpad Home Loans: Finance your new home with the Offerpad mortgage lending solution. You get step-by-step assistance right from the application process till closing. You can use this loan to finance single-family homes, residential units, townhomes, etc.

🎯 What is Offerpad Flex: Through this service, Offerpad funds repairs and improvements so that home sellers can attract better offers. Borrowers have to refund the amount at closing. Offerpad Flex covers paint jobs, fixtures, and countertops.

Offerpad Coverage

The iBuyer Offerpad offers services in 14 states.

⚡ Outside the Coverage Area: As of Oct 24th 2023, Offerpad has partnered with Anywhere Real Estate. Sellers outside Offerpad’s coverage area can avail of their services now.

How Much Does Offerpad Pay?

Offerpad offers are usually 70% to 80% of a home’s FMV. Additionally, there is further reduction after the home inspection.

Their final offer takes into account the 6% Offerpad service charge, repair expenses, and closing costs. So, ultimately your home’s worth may be reduced.

Offerpad.com Reviews

Offerpad has a 4.1-star rating on Better Business Bureau based on 264 reviews.

Most reviews praise their quick cash offers and flexibility in closing timelines. However, Offerpad complaints highlight their lowball cash offers and high service fees.

Offerpad Reviews: Customer Praises

✅ Juan was happy with Offerpad’s hassle-free process and competitive cash offer.

✅ Lisa was grateful for the flexibility and understanding shown by Offerpad’s team during the sale of her house.

Offerpad Reviews: Customer Complaints

❌ John was furious because Offerpad reduced his final cash offer drastically.

❌ Brent was furious with what he claimed were Offerpad’s “deceitful practices”.

Offerpad Pros and Cons

Companies like Offerpad help sellers who need to sell their homes quickly. However, their pros and cons paint a clearer picture:

👍 Pros

Let’s look at the pros of Offerpad:

• Instant Cash Offer: You receive a preliminary cash offer within 24 hours of submitting your property information.
• Flexible Closing Timeline: Offerpad allows you to extend your stay after the closing date by 3 days.
• Free Local Move: If your new home is within a 50-mile radius of your old house, Offerpad will help you move for free.

👎 Cons

Here are the disadvantages of Offerpad:

• Lowball Cash Offer: Offerpad’s final cash offer may be around 70% to 80% of your property’s Fair Market Value.
• High Additional Fees: You must pay a 6% service fee, repair, and closing costs when selling your house to Offerpad. This reduces the total cash you get in hand.
• Sellers Enter Into a Contract Before Knowing the Final Sale Price: Offerpad requires you to sign a legal contract if you accept their initial offer. Since the company lowers the offer after the home assessment, you don’t know the final price.
• Offerpad Cancellation Fee: If you back out from the transaction 4 days before closing, you must pay a 1% cancellation fee.
• Limited Coverage: Offerpad provides service only in 14 states.

Offerpad Competitors

» Jump to: Offerpad vs. Houzeo | Offerpad vs. Opendoor | Offerpad vs. HomeVestors

1. Offerpad vs. Houzeo

Selling to Offerpad seems quick and easy. But you pay for this convenience by selling your home at a lower price.

With Houzeo’s MLS listing, sellers can draw in more cash buyers and start a bidding war. You will be able to fetch a better price for your house as a result.

2. Offerpad vs. Opendoor

Opendoor has a similar business model to Offerpad. They have fast closing and more flexible terms compared to Offerpad. Opendoor also has better reviews than Offerpad from customers.

So, if you wish to sell a distressed property, Opendoor is a better choice.

3. Offerpad vs. HomeVestors

HomeVestors is a cash house buyer company that buys houses as-is. They have near-nationwide coverage, so you can sell to them easily.

HomeVestors provides cash offers that are roughly 70% of the after-repair worth of your house. Additionally, working with HomeVestors helps you to haggle and receive a better offer.

“We Buy Houses for Cash” Companies Near You

There are other “We Buy Houses As Is” companies in the market. You can request offers from multiple cash companies and pick the one that suits you the best.

Other Options You Should Consider

• Sell to an iBuyer: iBuyers purchase homes needing minimal repairs in as-is condition. They can be a great option if you want to sell your house fast.
• Sell to Cash Home Buyers: Individual cash home buyers make all-cash offers, usually within 24 to 48 hours. They also let you skip listing on the MLS.
• Sell For Sale By Owner: For Sale By Owner websites help you list and sell a house yourself. Hence, you save thousands in agent commissions. Many FSBO websites will also help you with the paperwork.

Is Offerpad a Good Option?

Offerpad is the most popular iBuyer. However, multiple cash buyers can offer you a better deal.

A smart way to sell to a cash buyer is to list your home on the MLS with Houzeo. Houzeo lists your property within 24 hours while providing wide exposure to attract multiple cash buyers.

Houzeo’s platform helps you to compare offers and request the highest and best offer. This allows you to grab a better deal. Moreover, you can also attract home buyers who are ready to pay 100% of your home’s value in cash.

» Houzeo Reviews: Check out why more than 6,000+ home sellers have rated Houzeo 4.9 stars out of 5 on Google and Trustpilot.

 

Eager to Know How Houzeo Works?

We’ve got you covered. Check out the video to understand how Houzeo works and why it is the best way to sell your house. 👇

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