In a Nutshell: Selling a home can be an emotional process, particularly when homeowners don’t actually want to leave the home but need to tap into their home’s equity. EasyKnock offers a solution to this challenging scenario by purchasing homes and allowing the (former) homeowners to stay in their homes and become renters. The company offers several options homeowners can choose from — some even include the option to purchase their home back at some point in the future. The platform may also offer an avenue toward credit repair because it pays off the homeowners’ mortgages.
Having a child with specific medical needs can be very costly, not to mention stressful. Jared Kessler, CEO and Co-Founder of EasyKnock, recalls the story of a woman in this situation and how his company offered her a way to relieve some of that stress.
The woman’s young son had a heart condition, and she was finding it challenging to keep up with his medical care, homeownership, and other financial obligations.
“She didn’t really have time to deal with added stresses in her life, so we came to her, we bought her house, and she rented it back,” Kessler said. “She was able to pay her medical bills, and her son was able to comfortably come home to his house.”
In another instance, a father and son owned a pizzeria together, and the son wanted to buy out his father’s portion to carry on the family business but didn’t have enough capital.
“But then he realized that our product could help him because he had equity in his home,” Kessler said. “So we bought the house, and he was able to stay there, and he used the money from the house and he bought out his father’s share.”
These are just two examples of EasyKnock’s unique take on the housing market and homeownership. The company purchases houses from homeowners, but the homeowners get to stay in their homes and become renters. And, in some cases, they can buy their home back.
EasyKnock’s solution gives homeowners in need of cash options other than refinancing, taking out personal loans, home equity loans, or selling their homes in the traditional manner.
Products that Create Flexibility Around Homeownership
Kessler describes EasyKnock as a platform that brings flexibility to the concept of homeownership.
“We started the company a little over four years ago,” he said. “The original premise was to connect owners and buyers directly for people who were thinking about selling their house. Then we thought about an option for customers to say, ‘I want to be a renter in my own home.’”
Kessler describes the company’s aha moment when it realized the structural dynamics of how many people have equity in their homes but can’t get the benefit of selling their home without having to move.
“That’s actually had a huge impact on the economy; it’s had a huge impact on the velocity of sales in the market,” he said. “People’s homes are both one of the most important financial assets they have, and it’s one of the highest emotional impacts in their lives — they’re emotionally tied to their home.”
After hammering out the concept behind EasyKnock, Kessler said the company launched its first product in early 2018, and today provides homeowners with three products.
“With our sale-leaseback program — Sell & Stay, we buy your house, you get the money you need, while staying in your home. Lease your home for as long as you’d like, with the option to buy back the house or move at any point,” according to the company website. This option allows customers to unlock more cash.
EasyKnock’s next product helps solve a conundrum many potential homebuyers face — they need to sell their current home before they can purchase their next home.
“With MoveAbility, EasyKnock buys your house and leases it back to you until you are ready to move,” according to the company. “When we buy your house, we pay off the mortgage. Now you have the ability to make an immediate offer on a new home without the contingency of selling your current home in order to go through with the new purchase.”
Moveability customers are eligible to stay for one year.
Finally, EasyKnock offers ReLease which offers more flexibility.
“With our sale-leaseback program, ReLease, we buy your house. You get the money you need, while staying in your home as a renter. Lease your home for as long as you’d like, while working toward your goals,” according to the company. The main difference between this option and its Sell and Stay program is that ReLease customers don’t have the option to purchase their homes back.
EasyKnock makes each of these options simple and straightforward for the homeowner and will guide them through every step of the process.
How the Current Housing Market has Enhanced the Need for Platforms Like EasyKnock
Kessler also discussed how the current housing market looks, in light of the challenging economic conditions 2020 has presented many U.S. residents. And how others have come out of the turmoil with relatively few scrapes.
“I think that the addressable market has gone up because the opportunities for people to have options have gone down,” Kessler said. “There’s a strange dynamic — you have two different worlds happening in the U.S. right now. You have a world where things are fantastic, the housing market’s at a 13-year high. You can’t sell a house fast enough.”
Then, another world exists, which is the world the vast majority of Americans live in.
“You just have to turn on the news,” Kessler said. “There’s unemployment, there are health issues, there’s just a lot of uncertainty.”
He said these two worlds co-existing is not sustainable.
“To isolate those two — at some point, one is going to feed into the other, and with the forbearance count going up, come January I think you’re going to see a real softening in the housing markets,” Kesler said. “I just don’t see how it can be sustainable.”
While this may sound like bad news for those U.S. residents operating on tight margins, EasyKnock is in a position to help a lot of people — who would otherwise be forced to take out loans or simply sell their home and move — remain in their homes.
“A home is the most cherished asset most of us will ever own. It’s a place where your family grows and memories are created,” according to the company. “We believe it should also be a life accelerator, giving you the means to seize new opportunities, achieve financial objectives or simply take charge of your future.”
Using the Program to Help Repair Credit
EasyKnock is undoubtedly an option worth considering for those who need access to funds but who may not want to take on more debt through loans or don’t want to sell their house and move.
But Kessler also highlighted another benefit for certain consumers considering EasyKnock’s services.
“We’re almost like a FICO repair on steroids because we’re paying off a mortgage,” he said. “We’re giving people money to pay off their debt.”
Consumers who max out their credit cards or take out big loans inevitably see their credit score go down, Kessler said. But EasyKnock can help get rid of that problem.
“A lot of people have a weight on their shoulders because of their FICO scores,” he said. “And we’re finding a new path for people to accelerate that credit repair process. I don’t want to claim that I know every single data point that drives FICO but it has to be a good thing to be able to basically serve some of these outcomes as it relates to FICO.”
And while the idea behind EasyKnock may be new to most homeowners, the concept and outcomes are solid, according to many EasyKnock customers.
“We have 4.8 stars out of 5,” Kessler said. “I always tell people, ‘Don’t take my word for it, just look at our reviews.’ I can’t manufacture those.”
He said that EasyKnock deals with a lot of middle-class Americans who are not necessarily valued in the traditional banking world, and a common theme among reviews is that the level of service EasyKnock provides is a welcome surprise.
“We’re working closely with them and solving problems that, in these tough times, are really important to people,” he said.