The flat-rate brokerage now offers bridging loans to turn home seekers into cash buyers. The Homie Cash program is available in Nevada, Arizona, Utah, Idaho and Colorado and will soon be rolling out to other states.
After laying off nearly a third of its employees, Utah-based flat-rate brokerage Homie has joined the ranks of firms seeking to make it easier for homebuyers to compete with cash offers.
On Tuesday, the brokerage announced the launch of its new Homie Cash program in Southern Nevada. Homie Cash allows buyers working with a Homie agent to make cash offers without financing contingencies and close within 21 days. The program’s goal is to give its buyers an edge in the highly competitive housing market where sellers have the upper hand and cash offers are three times more likely to win a bidding war, according to the company.
“I’ve seen too many Southern Nevadans, first-time home buyers with empty nests, lose the home they really want to investors or cash buyers,” said Mike Peregrina , co-founder and president of Homie, in a statement.
“That’s why we launched Homie Cash to give shoppers a leg up on the competition. By turning your offer into a cash offer, Homie Cash gives you peace of mind knowing you can make an offer. in cash as soon as you find a house you really want.
Homie laid off 119 of its 441 employees last week, citing a “changing real estate market”. Only six members of Homie’s home loans team were affected and the company said it would shift gears to make home ownership more accessible to buyers amid continued inventory shortages. With Homie Cash, the company joins the ranks of other “power buyers” offering programs to turn home seekers into cash buyers, such as HomeLight, Evergreen Home Loans, UpEquity, Knock, Homeward, Orchard, Ribbon and Reali.
The Homie Cash program is available in Nevada, Arizona, Utah, Idaho and Colorado and will be rolling out to other states soon, the company said.
To participate, buyers submit a short application for pre-approval by the brokerage’s lending arm, Homie Loans, which helps ensure they qualify for a conforming mortgage, and then they can start making loans. cash offers. Once an offer is accepted, buyers work with Homie Loans to secure a long-term mortgage, then Homie Loans provides a Homie Cash bridging loan so buyers can close their new home and then close their mortgage at long term.
There are no additional program fees to use Homie Cash, although the company notes, “There are standard closing costs and third-party fees associated with any real estate transaction. Before securing your main mortgage, your Homie Cash loan will earn interest, pro-rated daily.
Buyers can also get up to $2,500 off closing costs when they bundle Homie services, the company said.
Homie was founded in 2015 and almost immediately made waves for its business model, in which it charged buyers and sellers a $1,500 flat fee instead of commission while still using agents and attorneys who guide clients throughout the closing process.
The company has grown to offer home loans, insurance and title services. It also increased its fixed fee to $3,500 for sellers regardless of the price of the home (plus a buyer’s agent commission that the seller decides). If the buyer and seller are both Homie customers, the buyer’s agent commission is $5,000. Homie will also refund up to half of the buyer agent commission she receives from sellers to her buyers.
“Homie Cash levels the playing field by allowing buyers who don’t have hundreds of thousands of dollars in their bank accounts to become cash buyers and compete,” Peregrina said.
“Our mission is to make home ownership easy, affordable and accessible to everyone. We’ve saved our clients over $100 million in commissions over the past six years. Now we are empowering buyers who are at a disadvantage in this fiercely competitive market.
Homie has raised a total of $35.1 million in venture capital throughout its existence, most recently raising $23 million in a Series B round in February 2020, which the company said it planned to use to expand into Las Vegas and two other Southwestern markets by completion. of that year.
In 2020, the company became Utah’s top real estate brokerage by value and transaction volume after its revenue soared 150% in 2019, Inman reported at the time.
Email Andrea V. Brambila.
Like me on Facebook | follow me on twitter