The president of Flyhomes says they are seeing more demand as home sellers increasingly want to buy a new place to live before selling the one they are in.

Dan Richards said what started as a company with real estate agents, loan officers, and boots on the ground in Washington, California, Texas, and Massachusetts has expanded to 39 states and Washington, DC. 

And although Flyhomes can cover about 94% of all purchase transactions today, the goal is to be nationwide.

“I would actually say that we’re already there, outside of a handful of states on the coasts, and we’re seeing demand, really, across the board,” Richards said. “We found that buy before you sell is becoming very ubiquitous, that demand is definitely prevalent in pretty much any market.”

Flyhomes has funded $2.2 billion in loans and works with over 30,000 in-network loan officers, according to the company’s website.

Richards said Flyhomes was founded ten years ago as a real estate brokerage in Seattle, Washington.

“Over the years, working kind of boots on the ground directly with home buyers, we developed a lot of unique financial products, guarantees, and things like that to help facilitate the real estate transaction. Over time, we developed mortgage capabilities, built up a mortgage company, and for the majority of our existence over the first eight years or so, we were all direct to consumer,” Richards said.

“One of the products that we pioneered was the concept of buy-before-you-sell bridge lending in order to cover the gap between selling and buying. That process evolved quite a bit over time. We used to buy properties on behalf of home buyers and then resell it to them. Then we evolved into actual mortgage lending. Now that’s exclusively all we do today. So we are a bridge lender, and we operate exclusively through a wholesale channel.”

Richards said that more than 40% of all real estate purchases have some kind of home sale contingency. By allowing home sellers to buy earlier on, it alleviates the stress on all parties in the transaction.

If sellers want to move forward and buy before they sell, this is how it works:

“Let’s say they submit an offer on a new home, they go under contract, and they want to move forward, we’ll put their departing residence under a backup contract. That backup contract gives them six months plus to go sell their home on the open market without needing to sell to us,” Richards said.

“Because we have that backup contract in place, though, the purchase lender who’s working with us can disregard all of the trailing debt on the purchase loan and the DTI calculation that they’re making for the underwriting. And we can also extract equity from their departing residence with our product that we call Instant Equity. It’s a super seamless home equity product, extremely easy and quick to originate. We don’t collect income, assets, employment, verification, anything like that. We rely heavily on the loan officer and the purchase transaction that they’re involved in.  We’re 100% complimentary to the purchase loan that they’re already doing.”

Richards said he understands the entire process can seem daunting for home sellers. That’s where loan officers experienced with these transactions are invaluable.

“It’s a very emotional process, for sure. And you know, we have seen over our lifetime and in my own personal background in this industry, so many people stop there. They get pre-approved, they start shopping, and they go to some open houses. They get excited. And then they realize, ‘Well, maybe I can’t sell my home as quickly as I want, or for as much as I hope,’ or ‘This is just a really complex process.’  And they pull out of the process. We’re hoping that we can really unlock this and provide a lot of certainty and provide a lot more freedom and more movement and more transparency in this process for our buyers,” Richards