The Federal Trade Commission is fining home-buying company Opendoor $62 million!

What is Opendoor? 

Open Door's iBuyer program, or instant buyers as they are sometimes referred to have become a popular option for homebuyers who want the flexibility of buying and selling their properties without having any formalities involved. This type of buyer typically purchases homes directly from owners so there is no need for an agent’s assistance. The company Opendoor offers this service because it can close on deals much faster than traditional methods which can save a seller time by not having to stage a home or prepare a home for showings. 

What does Opendoor charge?

Opendoor, which charges its own fee in place of a traditional brokers' commission instead of absorbing it themselves like other real estate companies.

Why did Opendoor get fined? 

The Federal Trade Commission has Found that Opendoor's Marketing Materials Were Deceptive In A 14-Page Report That Included Screenshots Of Facebook Ads And Website Charts depicting how much customers could expect to make when selling their homes through this company. The evidence seemed promising at first glance, but it turned out users actually paid more than expected!

The agency also challenged the company's claim that it purchased homes at market prices, and said that the company's offers are, on average, below market value.

In a settlement announced on Monday, the FTC said Opendoor told customers that they could make more money selling their homes to it than they by selling homes traditionally. The FTC found that in fact, most people who sold their homes to Opendoor made less money than they would have selling to regular buyers via a real-estate agent.

Conclusion

If you are a homeowner who is looking to sell, it’s important to consult with a real estate professional in order to understand all of your selling options. Depending on your specific situation, you may find that one of the multiple cash offer programs available is a better fit for you than traditional methods. A real estate agent can help suggest the best option for your circumstance and guide you through each step of the process so that you feel confident and informed about what will happen when you sell your home.