Home News Opendoor fined $62M to settle claims of cheating home sellers

Opendoor fined $62M to settle claims of cheating home sellers

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Tempe, Arizona (3TV/CBS 5) – Opendoor has agreed to pay a $62 million fine to settle potential misleading home seller claims. The Federal Trade Commission alleges that a Tempe-based online real estate business tricked sellers into thinking they would make more money selling their homes to Open Door than to traditional buyers.

According to the FTC complaint, “the majority of consumers who sold to Opendoor found that Opendoor’s offers were We lost thousands of dollars in comparison, more than consumers would normally pay.” And the company knew it. The FTC said iBuyer’s “independent internal analysis shows that the consumer lost money on his Opendoor sales.” The company also regularly requested costly repairs that sellers didn’t have to make in traditional sales, he claims, the FTC.

“Open Door promised to revolutionize the real estate market, but it built its business using old-fashioned deceptions about how much consumers could earn by selling homes on its platform,” said the FTC’s Office of Consumer Protection. said Samuel Levine, director of “There is nothing revolutionary about deceiving consumers.”

“You get a letter that promises the world and it’s exciting. The problem sellers face is that they don’t know how it compares to what,” said Kelly Henderson, a real estate agent in Phoenix. “If [Opendoor] If they’re willing to pay for it, I’m sure they’ll have to turn around and sell it so they can get more money. “

Henderson said the booming Arizona housing market has fueled the fast-paced iBuyer industry. “There is nothing wrong with choosing to throw away money in exchange for convenience. Frankly, there are probably many sellers who got exactly what they wanted. “But the problem here is the way we approached it and a lot of people could have lost a lot of money.”

Opendoor declined On Your Side’s request for an interview, but sent a statement defending the company’s model.

“Since its founding in 2014, Opendoor has aimed to greatly simplify the real estate transaction, redefining the housing market and making buying and selling homes as easy as the tap of a button. Bringing transparency, competitiveness, and convenience to people in an outdated offline home transaction for consumers.While we strongly disagree with the FTC’s claims, our decision to settle with the Commission has helped us to resolve the issue. Resolved and freed to focus on helping consumers make buying, selling and moving easier, more reliably and faster. and related to the targeted marketing message that the company changed a few years ago.We are pleased to have resolved this issue and look forward to continuing to provide consumers with the latest real estate experience. .

In addition to the $62 million fine, the settlement agreement also prohibits Opendoor from making deceptive, false or unsubstantiated claims to consumers. The FTC was unable to immediately provide information on how many Arizona consumers would be affected, and it has not yet been determined how the $62 million will be distributed to consumers.

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