How much does Buy Before You Sell cost?
It's free to get started and see how much equity your client can unlock. If your client decides to use the program, there is a flat fee of 2.4%* of the departing residence sales price. For homes sold under $375,000, the flat fee is $9,000.
Thanks to the structure of the program, your client may be able to save up to 1-3% of the purchase of your new home with a non-contingent offer, and sell their existing home for up to 10% more by listing it unoccupied and potentially staged.
Equity Unlock Amount and Property Value
How do you determine how much equity you can unlock from the departing property?
We typically shoot for an approval that allows us to lend up to ~75% CLTV of the departing residence. For example, if the client’s home is worth $1,000,000 and the mortgage balance is $500,0000, we can potentially provide up to $250,000 to use towards the down payment on the next property.
How is the departing property value determined?
The primary factors that influence our valuation is the listing agent’s valuation and our team’s expected sales price. Our model also utilizes publicly-available market data including comps and risk factors which slightly adjust the final number.
How and when will my client access the equity?
We wire the funds directly to the purchase escrow account 1-2 days beforehand, or first thing in the morning on the day of the purchase closing.
How do you determine the purchase price in the backup offer?
The purchase price on our back up offer will mirror the agent’s valuation; however, we purchase the home at the “Loan Payoff Value” which is the sum of the outstanding mortgage and the Equity Unlock funds the borrower is using. We put a seller credit in the contract for the difference between the valuation/sales price & the Loan Payoff Value/”real” purchase price.
What is Upside Protection? Can you explain what happens if HomeLight needs to purchase the home at day 90?
We absolutely want the client to sell the home within the 90 day program period, but in the event they don’t, we purchase the home at day 90. While this is incredibly rare, we continue to use the same Listing Agent while ensuring the client has Upside Protection. If HomeLight purchases the home, the client will receive any excess funds less our 2.4% program fee and any additional costs (taxes, insurance, etc.) incurred during HomeLight’s ownership after it resells on the market.
How much time does my client have to sell the home after moving?
The listing agent has 21 days to list the departing residence after the new home closing if not already listed. The client and their agent have a total of 90 days to sell/go under contract before HomeLight’s backup offer goes into effect.
What does Loan Payment Value (LVP) mean?
HomeLight’s “Loan Payoff Value” is simply the sum of the existing mortgage and the Equity Unlock amount. This allows us to payoff the client’s liens if, in the worst case we purchase the home, before we deliver the upside from the 3rd party sale.
Process and Timeline
How do I submit a client?
On our lender-specific homepage! In the top right corner, you’ll find a button labeled “Submit a Client” that will take you to the BBYS Lender - Client Questionnaire.
But since you’re already here, you can click this link!
How long does the overall process take?
Once you submit your client, you and the agent will receive a next-steps follow-up email. This has the property questionnaire link and property photo guidelines. Once we receive the questionnaire & photos, we’ll have an approval letter sent out within 24 hours.
What is the Program Eligibility Criteria?
Read through our BBYS Eligibility Matrix to see if your client and their current home are a good fit for the program!
Why should my client use this program?
Clients using Buy Before You Sell find it is the most effective solution to move into their new home before selling the old residence. We enable borrowers to leverage the equity in their departing residence and move into their new home hassle-free. Empty homes also typically sell for more than occupied ones.
More importantly, as a top Loan Officer, you should use this product for the competitive edge it provides. We want agents to go directly to you when they have a client with a pending-sale contingency or they’re short on funds. Forget Zillow & Redfin, OfferPad & Knock - they’ll immediately think of “Joe’s Buy Before You Sell” offering. After all, you presented it to them 2 weeks ago and you’ve been buying them coffee for over 5 years.
*Fees subject to change; Minimums apply.