They are technically a RE firm and pocket the buyer’s agent commission for allowing you to use their cash for 30 days.
Transactional loan. This is pretty much equivalent to taking hard money loan - they are around 10%? 30 days, comes to agents fee.
Yup. They rebate you 1% of their 3%. They make 2% for 30 days. I bet the costs of the RE business are 1%, so the loan portion is making 1%.
Looks like a clever model.
If there’s a 2% transfer tax in Seattle, how can this model work? Buyer may need to pay extra 2% transfer tax and extra title insurance fees etc.
Why is that any different from today?
There are 2 transfer taxes and 2 title insurances if you buy through them. They buy it in their name and then sell to you at the same price.
You don’t have to pay for the transaction loan. It’s funded by the buyer’s commission.
I am curious how it works here with the 2% transaction fee. The seller pays the first one, but I’m sure they make you pay the fee when they sell to you.
Is the transaction loan zero interest? If flyhome really just buy the home first and then resell to me at the same price without any fees, it would be a really good deal. I would buy with them and hope the company can sustain and not go bankrupt in case some buyer can’t close deal.
Sorry this is not transaction loan if they buy it themselves. But yeah same problems exist.
Also they sell it to me, who do i eventually get the loan from?
You get your mortgage from your same old banks.
This business model only works in highly competitive market. I would not bet on this company. It’s not going nowhere.
Wonder if you can get better deals on homes with their cash though.
I think, it’s very amazing that sale home in cash.
I’ve seen couple houses they closed in bay area. Seems they over bid a little bit even after the market started cooling down for a while.
Definitely didnt see the cash advantage in those transactions.