We’ve touched on the new disrupter OpenDoor, which is currently operating in Phoenix and Dallas (places where home values might be easier to determine):
They are willing to pay cash for your house and close in three days, which sounds enticing for those sellers looking for instant cash. But they offer to buy your home at a below-market price based on algorithms, and fees range from 6% to 12%. They are glorified flippers.
The length of time it takes to close escrow should have improved by now. It still takes 30-45 days to process a sale, which might be advantageous for sellers who occupy the home – they usually need time to pack it up.
But for those sellers of vacant homes, or those who want to use their proceeds to purchase another home, a quick escrow might be preferred.
Thankfully, there are new alternatives.
Quicken is offering the Rocket Mortgage, and yesterday Caliber Home Loans rolled out their new product that can close a regular sale in 10 days or less:
These options should stop sellers from getting their head tore off just because they want a fast closing. These mortgage products could also really help the move-up market by alleviating the struggle of making offers contingent upon the sale of your current residence.
The regional VP of Caliber told me that their process is very innovative. They do not require the buyer to bring in the usual documents. Instead, they are getting them directly from the institutions themselves, which will help ensure accuracy. The IRS will furnish Caliber with income documentation, and the funds for closing will be verified directly with the banks themselves. The appraisals will be computer-generated in areas where you have easier valuations, like in Carmel Valley and Carlsbad where there are newer tract houses that are very similar.
We are close to being able to get a mortgage with the swipe of your ID card! It could invigorate the move-up market in 2017 – and Trump will get the credit!