Once only available in California, the expansion will see the Opendoor Finance App available in Texas, Arizona and Georgia, promising consumers preapproval letters in 60 seconds or less.
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Opendoor announced Wednesday that amid “resilient” buyer sentiment it is expanding its rapid preapproval app to three new states in the Sun Belt.
The product, called the Opendoor Finance App, was first launched in June exclusively in California. Wednesday’s expansion will see the app become available in Texas, Arizona and Georgia.
Consumers use the app by answering “four simple questions,” after which they can obtain a preapproval letter in “60 seconds or less,” Opendoor explained in a statement.
“Our proprietary technology identifies available loan options — including mortgage rate, guidelines, and terms — based on your needs and with your criteria,” the statement explains, adding that using the app to get a preapproval letter doesn’t impact a consumer’s credit score.
Preapproval letters typically come from lenders and provide evidence to homesellers at the beginning of a deal that a homebuyer can afford a particular property. The process of obtaining a preapproval letter can also help buyers understand their specific budgets. In some markets, getting a preapproval letter is an all-but-mandatory first step when shopping for a home.
When Opendoor first launched the app in June, it said most consumers could get a preapproval letter in under two minutes. The app also lets consumers browse through more than 1,000 loan programs. The end result, according to Opendoor, is that buyers could close on properties in as few as 21 days.
The company said that the timeline and process compare favorably to the traditional route to getting a preapproval letter, which involves “gathering countless documents from multiple sources,” and “endless questions about employment status or discrepancies between credit reports.”
In Opendoor’s statement this week on the app’s expansion to three new states, the company added that “applying for a mortgage is notoriously cumbersome and it can take days if not weeks to get pre-approved — just enough time to potentially lose out on a dream home.”
The expansion of the app comes at a tumultuous time for the housing business. Though the last two years saw record growth, rising mortgage rates in 2022 have since significantly cooled the market and reduced consumers’ buying power. Economic uncertainty has also weighed on the stock market and dragged down the share prices of publicly traded companies including Opendoor.
Despite the shift, however, Opendoor argues in its statement that today’s market conditions have made the app more relevant to consumers, not less.
“With rising interest rates,” the statement notes, “having a comprehensive view of what you can afford at any time is incredibly important – because even a small change in interest rates can impact a buying decision and cause a scramble for buyers.”
In a blog post on the expansion, Heather Harmon — head of Opendoor Finance — wrote that “buying a home can be stressful, intimidating and confusing in the best of times.”
“But no matter what the macro environment is like, with the right tools, buyers should feel empowered,” Harmon continued. “It all starts with having a comprehensive view of what you can afford at any time, because even a small change in interest rates can impact a buying decision and cause a scramble for buyers.”
Consumers are still engaged with the housing market, with 85 percent of buyers saying they’re willing to pay current prices, Opendoor said in its statement.
“Even with rising interest rates,” the statement continues, “Opendoor data indicates that buyer sentiment remains fairly resilient: aspiring home buyers continued to search for homes, and a solid 41 percent were spending more time looking.”