Homeward is a real estate financing service that, put simply, buys your new home for you with its own cash. Then you buy the new home back from Homeward later.
Homeward's "Buy with Cash" can give your offer an edge in a competitive market. And "Buy Before You Sell" lets you avoid the hassle of juggling a simultaneous sale and purchase, or carrying the costs of two properties at once.
But as you might’ve guessed, there’s no free lunch here. Homeward charges additional service fees and rent for the time you live in the new house before you buy it back from them.
Homeward does offer a few benefits over similar brands, though: you bring your own realtor, which means you can use a low commission agent to save thousands on commission fees. And you can lower Homeward's service fee if you use Homeward Mortgage for your loan.
Bottom line: Is Homeward worth it?
We think Homeward is a pretty solid option if you're interested in "home trade-in" or "cash-backed offer" services. It has generally solid customer reviews and recently launched in three new states, making it more widely available.
Homeward offers a few benefits over most competitors: Namely, opportunities to save by finding your own agent (and getting a lower commission) — and using Homeward Mortgage to get that lender credit to offset the ~1.9% service fee.
But a few key things to be aware of: You’ll still be on the hook for any and all standard costs for your sale and purchase. PLUS prorated rent to Homeward when your home sale closes. PLUS Homeward’s service fee. In other words, Homeward isn’t helping you avoid any costs you would’ve incurred on your own — it’s just delaying them (and charging you a little extra for it).
And don’t just assume Homeward Mortgage is your best value: The most important things with any loan are the interest rate and terms. Definitely still shop around to make sure you get the best rate possible. Even if Homeward effectively lowers its one-time service fee by ~1% at closing, if the interest rate is higher than another option, it could cost you tens of thousands of dollars over the life of your loan.
Homeward vs. the competition
Homeward's fees are on the higher side, but they can be offset if you decide to use Homeward Mortgage for your loan. And you can choose your own agent, which means better representation and additional savings opportunities.
Homeward is also more transparent about the fees and other expenses than a lot of its competitors. And it has a solid average customer rating, with reviews consistently calling out the responsive customer service and good communication.
Homeward is currently available in seven states: AZ, CO, FL, GA, OR, TX, and WA. If you’re somewhere else and looking for a similar service, Knock is available in more places. And if you need extra cash to get your home ready to list, Flyhomesand Orchard can help you there (Homeward doesn’t offer additional funds for listing prep).
👉 Key benefits of Homeward
The biggest difference between Homeward and other trade-in services (with the exception of Knock) is that you can bring your own agent to the process.
This could be a plus for people who have an agent they trust, or for people who want to use a low commission agent to save on realtor fees. Of course, that means a little more legwork for you and your agent compared to other one-stop-shop alternatives, who provide their own agent services.
But we think bringing your own agent is the way to go, given the additional cost savings opportunity — and the fact that choosing the best agent for the job will likely net you a better outcome on both your sale and purchase.
Homeward provides credits at closing if you finance your purchase through its affiliate lender, Homeward Mortgage. This credit could eliminate — or at least help reduce — Homeward’s service fee.
Homeward’s initial service fee of 1.9% drops to 0–0.9% if you use Homeward Mortgage as your lender for its Buy with Cash service. For the Buy Before You Sell service, using Homeward Mortgage lowers your effective fee to 1.4%.
Flyhomes, one of Homeward's competitors, also offers a rebate that eliminates its 1% fee, but the company requires you to use its in-house agents — so no additional savings there.
Most home trade-in services require you to rent your new home from them until your old home sells. Once your old home sells, you’ll buy the new home from the company and begin making actual mortgage payments.
Homeward charges 0.7% per month for rent, prorated by the day and deferred until closing. Many services are less forthcoming about how much they charge in rent, making it hard to estimate your costs — and know exactly what you’re signing up for…
With Knock, you begin making a regular mortgage payment once you move in, and Flyhomes says it charges somewhere between $100–200 per day, which is a wide range (between $3,000–6,000 over 30 days). Orchard has the best deal on rent, charging $50–100 per day until the old home sells.
Rental costs for a $300,000 home: Homeward vs. alternatives
Homeward is usually able to provide a floor price guarantee on your home, offering to buy it for that price if it doesn’t sell within six months. Homeward says that it typically pays 93–95% of fair market value for homes, which is more than what other services usually pay.
Orchard makes a similar guarantee, paying out after only four months, but it’s unclear how much it usually pays.
Keep in mind, however, that it’s unlikely your home won’t sell within a few months. Most homes will sell for a fair price within that time frame. But if you’re worried about your home sitting on the market without a sale, the backup offer can be reassuring.
👉 Homeward alternatives worth considering
Knock is a good alternative to Homeward if your home requires repairs before listing. Like Homeward, Knock allows you to use your own agent, but it also lends you up to $25,000 for home repairs to spruce up the house and get it ready for showings.
But unlike Homeward, Knock doesn’t offer a rebate to offset its fee: You’ll pay 1.25% plus a flat service fee of $1,450.
Flyhomes has a 1% fee that’s offset to 0% if you use its mortgage service. The company also offers to cover some of the closing costs, which could mean thousands in savings.
One big drawback with Flyhomes is that its rent charge of $100–200 per day is higher than other services. If you need to delay your move or anticipate a longer sale timeline, this could really add up.
Flyhomes also doesn’t let you choose your own agent, which means you have to roll with whoever they match you with — regardless of experience and personality fit — and there’s no opportunity to save on commission fees.
Orchard, like Knock, will front costs for repairs on the home to be listed, which can be deducted from the proceeds of the sale later on. Orchard also has the best deal on rent, charging $50–150 per day — and it doesn’t charge you rent for the first 30 days. Orchard will also buy your home if it has been on the market for four months without selling.
But Orchard doesn’t let you choose your own agents, which means less ability to get the best representation and personality fit, and limited ability to get additional commission savings. Its fee structure is 6%, which is comparable to listing with a conventional realtor. But when you go through a low commission real estate company, you could potentially cut that fee in half.
How does Homeward work?
Homeward offers three core services:
Buy Before You Sell: Homeward buys your new home for you before you sell your current one. You move in, list and sell your old home, then use the proceeds to buy the new one from Homeward. Buy with Cash (see below) is built into this service.
Buy with Cash: Homeward buys your new home for you with cash, then you buy it back from Homeward. It’s similar to Buy Before You Sell, but it doesn’t need to involve a separate home sale (i.e., you could use it as a first-time buyer). You still pay prorated rent from the day you move in until you buy the home back from Homeward.
Backed by Cash: Homeward will give you cash to buy if your financing gets delayed or falls through. This strengthens your offer (and gives you peace of mind) without committing you to actually using the cash and paying Homeward additional rent. Though you’re on the hook for at least 1% even if you don’t end up using their cash…
It also has an in-house title service and lending arm, Homeward Mortgage.
Look out for troubles with title services. Many reviews talk about Homeward’s clear communication, but a few negative reviews point out problems with its closing agents and title company. Make sure you and your agent agree to keep on top of everything required of you to close on the home.
Be ready to list your home once you buy. Once Homeward buys the new home for you, you’ll agree to put your home on the market within two weeks. Be sure that you and your agent can get the home ready in that amount of time before you make the offer on the new home. Again, it’s good to have both of your agents lined up before you initiate the process. If you’re selling and buying in the same area, you can also use the same agent for both (assuming they have the right experience).
Pay attention to the appraisal value and your purchase price. When you first make an offer on the home, Homeward will conduct a preliminary appraisal. If the preliminary appraisal value is below the purchase price, you’ll need to make up the difference:
- Buy with Cash: You must make a deposit equal to the difference.
- Buy Before You Sell: As long as the appraisal is within 10% of the purchase price, there’s no need to make a deposit. If the appraisal is below 90% of the purchase price, you’ll need to make a deposit for the difference to bring it to 90%.
Homeward’s Buy Before You Sell program
What is it? Homeward buys your new house for you (with cash) and you move in. You list and sell your old house, then use the proceeds to buy your new house from Homeward.
How much does it cost? The service fee is 1.9–2.4%, depending on which state you’re in. If you use Homeward Mortgage, you get a 1% credit at closing (so the effective rate drops to 0.9–1.4%). Prorated rent is 0.7% per month. You’re also required to put down a 2% earnest money deposit.
How does it work? Here’s a quick step-by-step overview:
- Step 1: Find local realtors for your sale and/or purchase.
- Step 2: Get approved for a specific amount so you know what homes you can afford.
- Step 3: You and your agent will submit an offer request to Homeward. You’ll sign Homeward’s Service Agreement Addendum and choose a lender, too.
- Step 4: When the seller accepts your offer, you’ll pay an earnest money deposit (requirement is 3%) and option fee, if applicable. You’ll also work with a lender to finalize the details of your loan.
- Step 5: Move into your new home. You’ll work with your agent to put your old home on the market within 2 weeks of buying the new home.
- Step 6: Sell your existing home with your agent.
- Step 7: Secure a mortgage and close on your new home by buying it back from Homeward.
What’s the general timeline? Homeward says you can get into your new home in as few as 14 days, if your offer is accepted that quickly. Once Homeward purchases your new home, you need to get your old home on the market within two weeks. You’ll accrue prorated rent based on the number of days it takes you to sell your old house.
Once the old house sells, you use the proceeds and/or new financing — either with your own lender or Homeward Mortgage — to settle up on rent, fees, and other closing costs, purchase the new home from Homeward, and assume full ownership.
Homeward’s Buy with Cash program
What is it? Homeward’s Buy with Cash (cash-backed offer) helps make your offer more appealing in a competitive market. It allows you to close faster and remove contingencies, which means less risk for sellers.
How does it work? Buy with Cash seems pretty much identical to Buy Before You Sell, just with different branding. You use Homeward’s cash to purchase your new home, then pay them prorated rent until you buy it back from them. The only difference is selling your own home doesn’t necessarily have to factor in.
How much does it cost? 1.9% in all states Homeward operates in. If you use Homeward Mortgage, your closing credit amount will vary by state. Some states refund the full 1.9% dropping the effective rate to 0% (aka it’s free). In other states, you get back 1%, dropping the effective rate to 0.9%. Prorated rent is 0.7% per month. You’ll also need to put down 3% for your earnest money deposit (compared to 2% for the Buy Before You Sell program).
Homeward’s Backed By Cash program
What is it? Backed by Cash is basically “closing insurance”: Homeward backs up your offer with its cash, so if your conventional financing falls through (delays, approval, or appraisal issues), you can still close on time. It’s added assurance for the seller without locking you in to use Homeward’s cash, so you can avoid additional costs like rent.
🟡 Limited availability: Backed by Cash is currently only available in Florida, Oregon, and Washington.
How does it work? Homeward pre-pproves you up to a certain amount. You make an offer and apply for conventional financing. If your loan gets delayed or falls through, Homeward steps in and buys the house with cash. If that happens, you’ll have to pay prorated rent until you buy back the house from Homeward, just like with its other programs. If you don’t end up using Homeward’s cash, you still have to pay a service fee.
How much does it cost? Backed by Cash services fees range from 1–1.9%. If you use Homeward Mortgage, you get a closing credit for 1%. If you end up using the cash, you’ll pay the standard prorated 0.7% monthly rent.
Full breakdown: How much does Homeward cost?
🔎At a glance: Homeward costs
Buy Before You Sell
0.7% per month
Buy with Cash
0.7% per month
Backed by Cash
0.7% per month
*Rates vary by state. **By using Homeward Mortgage, credit amounts vary by state.
We estimate that using Homeward to trade in your home with a traditional agent and finding your own lender will cost about 9.6–16.6%.
Example: Paying full price with Buy Before You Sell
If you want to save money, consider using Homeward Mortgage to take advantage of the lender credits and list with a 1% commission agent. Your cost could go down to about 5.7–12.7% — or about $23,400 using this same $600,000 example.
Example: Maxing out your savings for Buy Before You Sell
By comparison, trading the same two $600,000 homes would cost between $53,450–89,950 (8.75–14.75% + a $1,450 flat fee) using Knock with a 1% commission agent.
Going with Flyhomes would cost between $39,000–84,000 (6–13% + $3,000–6,000 for rent) if you take advantage of its service fee rebate and closing cost credits by using its mortgage lender and agents.
Using Orchard would cost between $55,500–87,000 (9–14% + $1,500–3,000 for rent).
Homeward charges 1.9% to use Buy with Cash, which can get canceled out or reduced by the 1–1.9% credit if you use Homeward Mortgage as your lender.
By comparison, Knock’s Guaranteed Offer has a flat-fee of $1,450.
Orchard’s similar Buy with Orchard program doesn’t have any associated costs, but you’ll need to work with one of its agents and pay a traditional commission of 4–6%.
How to save money when you use Homeward
Find your agent through a low commission real estate company
Unlike many competitors, Homeward lets you use your own agent when you use any of its services. This ensures you can get the best possible representation for your purchase and sale. Plus it brings some amazing additional cost savings opportunities.
We recommend finding your realtors through Clever Real Estate, which is our top pick for savings-centric real estate brokerages. Learn more about Clever here.
Clever offers a free, nationwide agent matching service that connects you with the best agents in your area from name-brand brokerages like Keller Williams, Century 21, and RE/MAX. But when you go through Clever, you also get big savings as an added perk.
- Sellers get pre-negotiated 1.5% listing fees instead of the typical 2.5-3% ($7,000 in savings, on average) — the best rates of any similar nationwide service
- Buyers can get money from their purchase price in cash back after closing
Because Clever is 100% free to use with no obligation, there’s no risk in trying it out to see who they match you with. If they find you agents you like for your sale and purchase, you’ll save thousands — completely offsetting your Homeward fees (and then some). You can give it a try via the link below.
🏡 Work with the best local agents, save thousands! Find top local realtors through Clever’s agent matching service: list your home for just 1.5%. Get cash back when you buy. Free to use with no obligation. Try it today!
Consider using Homeward Mortgage
You can use Homeward’s services with any lender, but there are added benefits when you secure your financing through Homeward’s lending arm, Homeward Mortgage.
Homeward customers who use Homeward Mortgage get “lender credits” at closing when buying their house back from Homeward, which reduces — or sometimes completely wipes out — the Homeward’s service fee.
The lender credits vary by Homeward offering and location, but here’s a quick breakdown.
Homeward fees and lender credits by service
How much can you save with Homeward Mortgage?
A 1% reduction may not seem like much, but when dealing with a high-ticket item like a home, it can literally translate to thousands or tens of thousands of dollars.
Of course, the most important thing with any loan is the interest rate and terms. Don’t just assume Homeward Mortgage is the best deal because of the potential credit. If you can get a better rate or lower fees elsewhere, that’s going to save you more money in the long-run.
Homeward Mortgage does offer competitive rates and provides a best price guarantee, where it will match more competitive offers up to 1% of the loan amount. But still make sure to shop around and make sure you’re choosing the best option.
Homeward Mortgage offers conventional, jumbo, and Veterans Affairs (VA) mortgages. It can also do Federal Housing Administration (FHA) loans, but you can't use them in combination with the Homeward Cash Offer.
Homeward reviews from customers
Overall, when combing through customer reviews of Homeward, we noticed a trend of clients praising the company’s customer service and communication. Homeward has an average rating of 4.7 across 500 reviews.
There are a lot of moving parts in a home trade-in, and all of the transactions can be challenging to keep up with. Homeward has earned high scores from reviewers for being transparent and in continuous contact with customers
This customer kept waiting for the other shoe to drop, but they were pleasantly surprised to learn that there was no “catch” — Homeward made sure everything went smoothly.
Giving customers a way to put down a cash offer on a home is one of Homeward’s core benefits.
Bringing a cash offer to a seller is a huge advantage in a competitive market. It makes your offer stand apart from others that may be requesting finance contingencies, which are special favors the buyer asks of the seller.
For example, a buyer might ask to delay closing to get more time to sell the old home or to wait for financing to come through. Cash offers don’t need these contingencies because they’re ready for the seller immediately.
This customer mentioned how helpful Homeward was at helping her overcome being outbid over and over as she made offers on new homes. Homeward’s cash offer helped her finally make a successful bid.
This customer had trouble with the title company but found Homeward to be very accommodating, even adjusting the rent to compensate for the delay.
It’s common to read complaints in reviews about miscommunication like this during closing, because it can be frustrating. It’s less common to see a reviewer point out that the company made things right.
Customers give Homeward high marks for good communication overall, but a small number of reviews prove that the company is not perfect. Miscommunication during the closing process can jeopardize the entire sale if it’s bad enough. That seems to be what almost happened in this case.
This customer was very dissatisfied with the closing process, but updated their review to say that Homeward acknowledged the failures on its end and refunded the customer’s fees.
Interestingly, this customer notes that their agent helped untangle the mess for them, which demonstrates the value of having and being able to choose an agent you can trust.
Where is Homeward available?
Homeward’s core services are currently available in seven U.S. states: Arizona, Colorado, Florida, Georgia, Oregon, Texas, or Washington. Though its Backed by Cash offering isn’t only available in three. Here’s a quick breakdown of service availability.
Buy Before You Sell
Buy with Cash
Backed by Cash
If Homeward isn’t available in your state, consider Knock, which is more widely available.
FAQs about Homeward
Is Homeward a legit company?
Homeward can help you buy a new home before you sell your old one. It's a legitimate company offering home trade-in services in Arizona, Colorado, Florida, Georgia, Oregon, Texas, and Washington.
Founded by Tim Heyl in 2018, Homeward has had several rounds of funding over the years, most recently getting $371 million in May 2021.
Homeward is headquartered in Austin, TX, and has three divisions: Homeward Cash Offers, Homeward Mortgage, and Homeward Title.
What does it cost to use Homeward?
Homeward charges 1.9% to use its Buy Before You Sell and Cash Offer services. The fee for the Buy with Cash program is offset to zero if you use Homeward Mortgage to finance your loan; the Buy Before You Sell fee is offset to 0.5% if you use Homeward Mortgage.
Once you consider closing costs and rent paid on your new home until the old one sells, we estimate that it will cost between 5.7–16.6%, all in, depending upon your mortgage choices and agent commission. Find out how Homeward stacks up against the competition.
How does Homeward make money?
Homeward’s primary income is derived from the service fees it charges for using its Cash Offer and Buy Before You Sell services. The company also makes money on secondary services, like its mortgage and title companies. Finally, Homeward may make the occasional profit on home price appreciation from its trade-in service. Learn more about Homeward.
Can you buy a new construction home with Homeward?
Yes! Homeward will require information about the new home’s specifications, price, proposed completion date and percentage of completion.
Before writing this review, our team spent weeks studying each real estate trade-in service to compare each company across multiple axes. Our research process included:
- Mystery shopping each company
- Interviewing real estate experts
- Conducting a spreadsheet analysis of each service provider's terms and fees
The Perfect Property Podcast: An Atlanta Real Estate Guide. "Need to sell before you buy? The Homeward Solution!." Accessed February 17, 2022. Updated September 5, 2020.
Forbes. "Real Estate Startup Homeward Raises $371 Million, Landing Valuation Above $800 Million." Accessed February 17, 2022. Updated May 27, 2021.