Another startup trying to disrupt home buying financing. Upon determining your "Buying Power," Ribbon backs you for a guaranteed all cash offer to help you win out against other bidders. You have until closing to secure your mortgage and if you don't, they purchase the house for you and you rent from them until you secure your mortgage. Ribbon's revenue comes from a 1.95% fee of the offer price.
Interesting concept that could help in ultra-competitive markets like mine (Northern NJ) but I wonder how sellers would feel if buyers gets their mortgage before closing and use that financing to close the deal? Seems like a "bait and switch" that could cause the deal to fall through.
What do you think?
There's more to a cash offer than just the financing. Cash offers from investors normally get combined with as is, no inspection contingencies . While I see retail buyers using this service to offer cash, I'm having a hard time seeing them purchase properties in as is conditions. That is without an inspection clause. Which would mean that investors should still have the edge .
Missing from the article are any testimonials from retail buyers who is successful using ribbon. Then again I think the app froze on me as I wasn't able to complete the entire article. Was a past customer quoted in the article?
@Amanda Roselli I have to agree with @Ibrahim Hughes comment. There is a lot more to a cash offer than just cash. Sellers prefer it because they can quickly offload their properties without waiting for other conditions (property inspection, etc) to be completed.
The success of this startup will also vary from market to market. Certain markets - NJ or other more expensive markets - are more aligned with this startup's mission. Other markets - Midwest, most of the South - not as much because inventory is cheaper and moves slowly.