Compass Concierge has proven itself to be a significantly compelling service offered by real estate brokers to home sellers. Initially pioneered by Pacific Union (acquired by Compass), the brokerage provides the seller with money to fix up the home for sale. When the house trades, the money gets paid back. Brokers report that homes which have been prepared for the sale, sell faster (and for more money) with fewer seller concessions – so the seller wins. Moreover, the buyer has a move-in-ready house without a laundry list of issues to fix.
HouseAmp is a technology company that provides software which connects homeowners, lenders, and service providers to enable this service for any brokerage. It’s a brand-new type of HELOC that costs the seller 1% interest monthly on the money. There are no closing fees. Underwriting is based upon home equity and some other criteria. The seller can use the money however they like, i.e: hire their contractors, or use recommended service providers from the agent or broker. The seller can borrow $10,000 to $400,000. If more than $400k is needed, just have a conversation with HouseAmp.
HouseAmp has been developing the software for more than three years; it allows consumers to complete a quick application taking only on to four minutes – depending on typing speed. It’s short and simple. The funding approval is completed in less than 10 minutes. HouseAmp partners with nationwide banks; they can also support a broker’s bank or lending arm if they own one. So, companies like Howard Hanna, BHHS, and more, can be the funding source if desired. I think that John L. Scott does some of the loans with their national banks. They are a large enough firm to get a white-labeled version of the product from HouseAmp. Windermere may also have a white label version, and I am sure that there are more. Compass uses them in some markets. Adoption of HouseAmp happened fast in markets where there is strong competition for listings with Compass Concierge. Lets face it, many sellers do not have the cash on hand to optimize the property for sale and the ones that do have cash are smart enough to use services like this one, so that they don’t have to face a tax consequence.
HouseAmp is not new. The company has been working with large firms in a handful of states to pilot and refine the product for a handful of years – some large western markets like California and Washington, and eastern markets like Florida, for example. The funding now enables them to offer the service nationwide – except for Texas (long story). It took some time to develop the new loan type, obtain compliance across the county, and lock in the terms with the bank. I know that the HouseAmp CEO, Rick Hennessey will be speaking at the upcoming RISMedia CEO Exchange. So, if you are going, be sure to set some time with Rick. This new funding makes HouseAmp available to any size firm. They hired industry veteran Scott Mullen to lead the sales team.
Service providers are invited by the homeseller, agent or broker to create an account in the system to get paid fast. HouseAmp withholds a standard credit card percentage of 3.5% on payments; and payments requested by a Tuesday are funded by ACH on a Friday.
The USD $12.5 Million came from individual investors, Third Prime and Fortress Private Equity. The funding was announced by Crunch Base and covered by GeekWire.
WAV Group will also be at RISMedia CEO Exchange. John Featherston and his team have put on this extraordinary event for years. We are excited to moderate the Mergers and Acquisitions panel titled, “M&A Strategies in a Growing Market” with executives from RE/MAX, Compass, United Real Estate, Coldwell Banker, and Raveis. My understanding is that this year’s conference will feature a dinner boat cruise for the entire conference – that must be a big boat!
