This month we will be talking to mortgage leaders about where the market is headed and how products are digitally evolving to meet buyers’ needs. We’ll also be exploring new alternative funding options that are changing the game for buyers and sellers. Visit us for the month of the mortgage and alternative financing.
Even before the COVID-19 pandemic severe housing shortage plagued large markets across North America. As a result, COVID-related restrictions gave way to a historically active real estate market and low inventory levels in even more markets, including suburban and rural enclaves.
The result for most buyers has been a frustratingly unresponsive seller market, where buyers bid for bids and lost in bidding wars against money buyers. Never before has the distance between a good offer and a winning offer seemed so great.
Enter Homeward, a home buying platform currently operating in Texas, Colorado, and Georgia that seeks to level the playing field by allowing traditional buyers to become essentially cash buyers. Tim Heyl, CEO and founder of Homeward, explains: “First we buy the house that a customer loves for them – with cash. We call this the homeward purchase. Then buy it back from us. We call this the customer purchase. “
Get to know Homeward
Heyl is a longtime real estate professional and entrepreneur who founded Homeward in 2018 and was named Inman News Innovator of the Year in 2019. Homeward’s primary services are aimed at two types of buyers: those who have an existing home for sale but want to buy first, and those buyers who are interested in maximizing their competitive advantage without regard to home sales.
Homeward first approves the customer to join their program and then works with their existing agent to create a Homeward offer on the customer’s behalf, Heyl said. Once the customer has completed their mortgage, they will buy their home from Homeward.
This can be done after the subscription and approval process in the case of a new loan or after the sale of a current home in the case of a sale with purchase.
For agents, Homeward offers a powerful differentiator and value-added service. In today’s competitive landscape, the ability to help customers write more successful offers, not just agents, helps convert leads and attract new buyer customers. It helps them serve existing customers better, resulting in rave reviews and future referrals.
Services available with Homeward
Working with Homeward begins with an application from the homebuyer and an approval process of up to five days. Homeward suggests starting the approval process in advance so buyers are ready to bid when they find the home they want.
The application process is similar to a mortgage pre-approval process, and information about income, assets and credit is collected. In the case of a purchase prior to selling an existing home, Homeward also collects information about the home to calculate its equity value.
Homeward can be used for both new buildings and existing houses. In the case of a new home, Homeward will need information about the specifications, price, proposed completion date and degree of completion of the new home.
Buy with cash
Home buyers who want to take advantage of the bUy-with-cash Service is able to eliminate contingencies, offer a faster deal and win in situations with multiple offers. Cash shoppers are three times more likely to hit funded bids, according to Heyl, allowing buyers to shop with confidence in today’s highly competitive marketplace.
Buy with cash Customers pay an earnest money deposit (EMD) of 3 percent. Homewards who use Homeward Mortgage, an affiliate, to finance their purchase will receive a credit at the deal equal to Homeward’s standard 1.9 percent convenience fee, effectively reducing the cost of the cash purchase to 0 percent be lowered.
If homebuyers are otherwise funded, the standard fee applies. In addition, a pro-rata rent will be charged for the period between the purchase of the home by Homeward and the subsequent purchase by the buyer.
Buy before you sell
Home buyers looking to buy a home before selling their current home can go for that Buy before you sell Service. This provides more peace of mind to homeowners who worry that they will sell their home too quickly and then won’t find a home to buy. It also provides the reassurance of knowing that in the event of a delay in closing, the homeowner will not pay two mortgages.
Home buyers with the buy-before-you-sell Option pays an EMD of 2 percent. Home buyers who use Homeward Mortgage will receive a credit upon completion that allows them to pay a reduced convenience fee of 1.4 percent of the home’s selling price. When using a different lender, the standard convenience fee is 2.4 percent in Georgia and 1.9 percent in Texas and Colorado.
Homeward Certified Agents or Brokers
According to HeylMost alternatives to traditional real estate minimize the realtor or require homebuyers to work with an agent they do not know. ” In contrast, Homeward helps agents work with their existing customers to provide additional options for more successful deals. The Homeward Certified Agent (HCA) program includes two separate phases of onboarding to bring agents who are new to the service up to date.
The Homeward Certification is a webinar that introduces agents to Homeward and helps them understand how the service works and what types of customers are well-suited for the program. The Homeward Nuts & Bolts webinar provides an in-depth look at the details of a Homeward transaction, including how to create a Homeward cash offer and how to create the sales contract for a Homeward offer.
Although certification is not required, “we encourage agents to become HCA certified before using our services,” said Heyl. “We also encourage them to give their customers permission to use our services once they work together so that their customers are ready to make a cash offer once the house they love hits the market.”
Ask an Agent: Jayna Love
According to Jayna Love, team leader on the Jayna Love Homes team at Keller Williams Realty in Austin, Texas, Homeward offers a solution to address inventory shortages across the country, especially in active markets like theirs.
“In the [Austin]It’s not uncommon for us to write five, six, seven or eight offers for our customers before we win one, ”she said. “There was a time when it was very difficult and the customer became very discouraged.”
With Homeward, Love and her team can create successful offers in scenarios with multiple offers. “From a seller and listing agent perspective, the risk of doing this instead of turning the wheels and allowing customers to come up with a really strong cash offer is small,” said Love. “There’s nothing better than calling your customer.”
Because new homes are so difficult in tight markets, Love’s current homeowners can buy the home of their dreams with cash, pay the convenience fee, close quickly, then clean up the previous home and prepare it for display during the customer rents the new home from Homeward. According to Love, this is essential both in the age of COVID-19 and for families with children and pets.
“People have lives and it’s difficult to deal with all of this and keep things pristine,” she said while marketing a home. “It is impractical to sell one house and buy another at the same time. Homeward takes away a little of that inconvenience. “
According to Love, the process of connecting Homeward with a customer is straightforward.
- Go to Homeward.com, click on a link and fill in your information and the customer’s information.
- A Homeward representative calls within an hour to gather additional information and ask permission to contact the customer directly.
- The client must qualify for the program in a manner similar to a mortgage qualification.
- A Homeward representative will run the process with the agent and customer and answer any questions.
Love and their team’s experience “was really positive. They are seasoned professionals behind the scenes. They ensured smooth transactions and great customer service. “Love said that many of Homeward’s teams are or have been real estate professionals whose service is intuitive and seamless.
“My customers were avid fans,” she said. “When my customers are happy and win, my team and me look better and the overall customer experience is better.”
Homeward currently operates in Texas, Colorado and Georgia, offering frustrated buyers, their agents and brokers a new option for a more efficient and streamlined buying process that leverages the cash-buying opportunities. Through its affiliates Homeward Mortgage and Homeward Title, the company offers a bundled service that can save homebuyers money, time and effort.
Christy Murdock Edgar is a real estate agent, freelance writer, coach, and consultant, and owner of Write real estate. She is also the creator of the online course Creating the Property Description: The step-by-step formula for reluctant property writers. Follow Writing Real Estate on Facebook, Twitter, Instagram and Youtube.