Offerpad Fees Revealed: Are the Costs Worth It for Sellers?
Offerpad is one of the largest iBuyers in the U.S., offering property owners the opportunity to sell their homes quickly for cash, with no need for renovations or showings. Offerpad service fees are 5% of the sales price, or $20,000 on a $400,000 home sale. Offerpad is an option for those looking to sell their house fast, without the hassle of repairs, showings, and negotiations. The company makes offers within 24 hours and can close in as quickly as 8 days.
When selling to a cash buyer, it’s important to compare multiple offers to ensure you’re getting the very best deal for your largest investment.
If you’re short on time but still want to compare offers and maximize your profits, Clever Offers is your solution. It lists your home on the open market for just 7 days, and you’ll attract serious buyers—many offering cash—who are ready to close quickly. Get your cash offers today!
Jump links: Offerpad fees | Offerpad vs. realtor | Offerpad vs. competitors | Is Offerpad worth it? | FAQ
Offerpad fees for selling a house
Below is a breakdown of Offerpad fees with example costs based on a $400,000 home.
Type of fee | Cost | $ amount for a $400,000 home |
|---|---|---|
Service fee | 5% | $20,000 |
Closing costs | 1-3% | $4,000-$12,000 |
Repair costs | Depends on the home’s condition | Varies |
Cancellation fee | 1% | $4,000 |
Total | 7-11% | $28,000-44,000; $4,000 to cancel |
Service fee
Offerpad charges a fixed 5% service fee. This charge covers the company’s costs, such as home inspections, necessary repairs, and marketing the home.
Closing costs
Homeowners are expected to cover closing costs, which are a part of any property sale. The exact amount depends on your state and the home’s value, but it usually ranges between 1-3% of the home’s purchase price. Offerpad’s closing costs cover title insurance and title search fees, taxes, and escrow fees, among other expenses.
Repair costs
Repair costs can vary significantly depending on the home’s condition and age. Typically, Offerpad charges around 2% of the total home value for repair costs, but this amount could be higher if the inspection uncovers problems with the home.
After the initial offer from the company, the home inspection, and the adjusted offer with repair costs,sellers have two options:
- Fix the issue themselves before closing
- Deduct the cost of repairs from the initial cash offer
If neither solution is acceptable, you can still cancel the contract at this stage without any penalties (make sure you do it within the approved timeframe!).
Cancellation fee
This fee applies only if you decide to back out of the contract after accepting the offer and amounts to 1% of the total offer price. To avoid it, compare Offerpad’s offer to other options and ensure you want to proceed with Offerpad before signing the contract. If you really need to back out after signing, read the contract to determine the deadline for getting out of the contract without paying any fees.
Total cost
Expect to pay Offerpad between 7-11% in fees. This includes the service fee, closing costs, and typical repair costs. For example, on a $400,000 house, you can expect to pay anywhere from $28,000 to $44,000 to Offerpad at closing.
Offerpad fees vs. realtor fees
Here are the total fees and final profit to the seller on a $400,000 house, comparing Offerpad to both traditional and discount brokers.
Type of cost | Offerpad | Traditional agent | Discount agent |
|---|---|---|---|
Sale price | $320,000-360,000 | $400,000 | $400,000 |
Fees/commissions | $20,000 (5%) | $24,000 (6%) | $12,000 (3%) |
Closing costs | $8,000 (2%) | $8,000 (2%) | $8,000 (2%) |
Repairs | $12,000 (3%) | $12,000 (3%) | $12,000 (3%) |
Profit to seller | $280,000-320,000 | $356,000 | $368,000 |
*Estimates are based on averages and may vary based on individual circumstances, market conditions, and other factors. Repair costs, service fees, and closing costs may differ based on the property and location. | |||
Key takeaways and considerations:
- An Offerpad commission is comparable with what you would pay to a traditional real estate agent. Additional expenses, like closing costs and repairs, typically stay the same whether you sell with an iBuyer or a broker.
- Many clients reported that Offerpad’s home valuations are lower than the market average. Selling with an agent allows homeowners to receive full price for their property, which can sometimes exceed the market average.
- While selling with an agent usually means a higher sales price, agents also charge commission for their work. Low-commission realtors are usually the best way to earn top dollar for your home because they charge significantly less than full commission and provide full-service support.
Even if you’re in a rush to sell or need to sell your home for cash, it is worth talking to a realtor before signing a contract with an iBuyer. A professional real estate agent can help you prepare your home for sale and market it properly to ensure you get the most bang for your buck.
For example, with Clever Offers 7-Day Sold, an agent works with you to solicit bids from cash buyers for seven days, helping you sell your house quickly for cash to the highest bidder.
Offerpad fees vs. competitors
Opendoor is one of the largest Offerpad competitors, and sellers often choose between the two. The service fee for both companies is identical at 5%, but some clients mention receiving a better offer from Opendoor. In this scenario, Offerpad’s sales rep might be able to match the Opendoor price.
The biggest difference in fees between Offerpad and Opendoor is the cancellation fee. Offerpad charges sellers who back out of a contract a 1% fee, whereas Opendoor allows them to cancel their contract for free at any point.
We always recommend comparing multiple offers before making a final decision. On top of that, consider other options — for example, you can sell your house for cash through a real estate agent or a cash offer company.
Cash offer companies, such as Clever or HomeLight Simple Sale, connect sellers with interested buyers in their market who are ready to buy a house quickly for cash. While these buyers also usually pay below market value, a seller does not have to pay any service fees and can compare multiple offers to choose the one that works best for them.
If you’re on a tight budget but don’t need to sell immediately, working with a discount broker might be a better option for you. Using Clever, you can find a realtor in your area and save money on their commission, while still getting a full range of service and a fair price on your house.
The bottom line: Is Offerpad worth it?
Offerpad could be worth considering for certain types of sellers. If you want to sell quickly without worrying about repairs, staging, showing, and more, then, Offerpad could be an ideal option.
If you don’t want to leave money on the table and have time to compare other solutions, consider a cash offer company or working with a realtor (or a discount realtor) first. That way, you can maximize your profit and turn to iBuyers later if needed.