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Frequently Asked Questions
What is ZeroDown?
ZeroDown has designed a program that allows our customers to move into their dream home right away and without a down payment. Think of it as both trying before you buy and fast forwarding homeownership!
ZeroDown will buy your dream home for you today and we give you the ability to purchase the property from us on your schedule. Lock in your monthly payment, lock in the purchase price and stop wasting your money on rent. If you don’t like the home, you have the ability to opt out of the property after two years.
Is ZeroDown a lender?
No, ZeroDown is not a lender and you are not getting a mortgage. ZeroDown buys the home and you make monthly payments. You will also have the exclusive right to buy the home from ZeroDown and the purchase price will be determined upfront. No surprises!
In which areas of the country does ZeroDown operate?
ZeroDown currently operates in the San Francisco Bay Area, the Greater Seattle Area and the Greater Austin area. Coming soon to Denver, Dallas, Phoenix, Minneapolis, Atlanta and Columbus areas.
How does ZeroDown make money?
When we buy the home you love, we split commissions with the realtors. We didn’t invent this, the commission already exists in standard real estate transactions.
You buy the home from us at a predictable annual appreciation rate of 2.5%. The purchase price is a flat 1.25% higher if you buy anytime up to your 6 month anniversary, and then it increases at a rate of 0.20833% per month. For example, if we bought a $400,000 home for you, and you choose to buy it back from us:
- 1-6 months later, your purchase price would be $405,000.
- 7 months later, your purchase price would be $405,833.
- 10 months later, your purchase price would be $408,333.
- 12 months later, your purchase price would be $410,000.
- 18 months later, your purchase price would be $415,000.
- 24 months later, your purchase price would be $420,000.
- And so on and so forth.
What if the home’s actual value increases at a rate faster than 2.5% annualized? You still get to buy it from us at that fixed 2.5% annualized rate, and keep all of the upside.
Who is ZeroDown for?
ZeroDown is for those who want to try the home before they actually buy. No need to lock up all of your savings right away. With ZeroDown, you find the home you want and in one click we begin the buying process in the background, creating a simpler, smoother, and more flexible home buying experience for you (without the busy paperwork).
How should I evaluate ZeroDown against other options?
ZeroDown represents a new approach to homeownership, developed with homebuyers’ interests in mind. We strive to give you more flexibility and control within your home buying timeline. In that way, there’s no real comparison between traditional options and ZeroDown. If you’re going to compare anyway, it’s a good idea to weigh all the possible costs and benefits, keeping in mind the buying, living, and selling experiences:
- A super-powered buying process: expert level experience, all cash offers and keys to your ZeroDown Home in as little as 2 weeks!
- Simple financial terms: no debt, no financing uncertainty, no hidden fees and only one unchanging monthly payment.
- A concierge service that makes the experience of living in a ZeroDown home one-click easy.
- A rewards program that gives you discounts or rewards for purchases made through us after you have moved into your ZeroDown Home.
What does it mean to make a “cash offer” and why do sellers often prefer this?
Making a cash offer on a home simply means that the buyer has 100% of the funds needed to close the home using cash, as opposed to a loan. Sellers tend to prefer cash offers for two reasons. First, cash offers allow for a much faster closing process. Because no lender is involved, the buyer is simply transferring cash from their account(s) to escrow and eventually to the seller’s account - no need to wait for the lender or worry about any loan approval process. Second, a cash offer reduces the risk of the transaction falling out. Almost all financed offers are subject to an appraisal, which the lender uses to determine the value of the property and ultimately if the loan will be approved. Cash offers usually do not require a formal appraisal process (because there is no lender involved at all).
Does ZeroDown give you a better chance at getting your offer accepted?
We think so! Because of our cash offers, as well as our dedicated team’s focus and expertise, we are able to offer much more aggressive closing timelines and the best offer terms - all things that sellers are looking for and may not be possible without using ZeroDown.
How does ZeroDown compare to taking on a mortgage?
A mortgage loan is how most Americans buy their home. However, they require hefty down payments, closing costs and approvals from third parties (e.g. banks, appraisers, etc.). All of this implies a large commitment on your part right away, with no ability to try the home out beforehand.
With ZeroDown, you get to try before you buy. Find your dream home and ZeroDown will buy it for you using a cash offer and with no down payment requirement. Once you move in, try the home out and make sure you love it. When you’re ready, buy it from us or simply move out anytime after 2 years - no strings attached.
How does ZeroDown compare to just paying rent?
Renting typically does not allow for much flexibility throughout the entire process. For instance, when looking for a rental property, you are limited by the rental market - not every home is available to rent. Also, you typically don’t have the option to purchase the home.
ZeroDown addresses all of those limitations - you can pick ANY home on the market to live in that meets our our property guidelines, and buy the home whenever you are ready.
How does the ZeroDown process work?
Working with ZeroDown is quite simple and looks like this:
Sign-Up and Qualification:
Fill out an online application, which allows us to verify your income, assets and credit. From there, we work with you to determine a reasonable home price and monthly payment budget that will guide your home search.
Choosing Your Home:
After your qualification, you will sign a services agreement with us and half of your starter cost will be due at that time. This payment is 100% refundable if ZeroDown does not end up purchasing a home for you, but is non-refundable once ZeroDown makes an offer on a home for you that is accepted.
You’ll then be introduced to our partner agent, who’ll help you find and tour properties for sale in your preferred neighborhoods. Once you identify a property you love, we guide you through the entire purchase process.
Purchasing Your Home and Move-In:
Now that you’ve found your dream home, we’ll go through the bidding process together. Our ZeroDown real estate experts will do the property diligence and determine the best offer strategy. When the offer is accepted, ZeroDown will handle the entire closing process. After we have closed on the home, you’ll enter into two agreements with us: (1) a lease that clearly lays out all the necessary details including but not limited to move-in date, monthly payment, and your rights and responsibilities as a ZeroDown resident, and (2) an option agreement, which gives you the exclusive right to purchase the home from us at the applicable fixed prices. The other half of your starter cost will be due at this time. After that, you’ll get the keys and move in!
Can I choose any home available or do I have to choose a home from ZeroDown’s inventory?
You are free to find your home using any method you’d like. ZeroDown will also set you up to work with one of our top partner agents, who are experts in their respective local real estate markets.
Please see our our property guidelines for a summary of the type and condition of homes that are and are not eligible for the ZeroDown program.
Does ZeroDown do anything to help me assess home quality?
Absolutely! We have a team of real estate experts that will work with your agent to review disclosures, coordinate offer terms and ultimately decide if the purchase is a quality investment - because that is what it has to be for us since we’re the ones who have to buy it first. We are right there with you every step of the way from the original purchase to the point when you are ready to buy for yourself.
Who pays the closing costs on the home?
ZeroDown takes care of all the costs associated with the original property purchase. Your only costs are the starter cost and the monthly payments (which include HOA payments if the property has an HOA). There will still be some closing costs when you buy the home from us with a mortgage later, which would typically be split between you and us in a way similar to how other buyers and sellers split such costs in your local market.
What is my qualified price range when buying a home with ZeroDown?
Once you sign up, you’ll go through a qualification process with ZeroDown to determine the most suitable price range based on your financial situation. Typically, ZeroDown homes in your area are priced between $400,000 and $800,000.
Can I use my own Agent?
We have gathered a group of expert partner agents that we would love to recommend to you. If you'd absolutely like to continue working with your agent please have them contact us right away at firstname.lastname@example.org.
Does ZeroDown purchase new construction homes?
Yes! If there is a new construction home or development that is of interest to you, we are happy to look into it. These are often great fits for our customers.
How do I qualify for ZeroDown?
When you begin the qualification process, we ask you for a few pieces of basic information and to provide proof of your income, assets and credit.
Does qualifying for ZeroDown affect my credit score?
No. The qualification process only requires a soft credit check, which will not impact your credit score.
What information do I need to provide to ZeroDown to qualify?
When you begin the qualification process, we ask you for a few pieces of basic information and to provide proof of your income, assets and credit.
How long does the qualification process take?
Once you complete your qualification application, we will be in touch with you as soon as possible, usually within 24 hours.
What are my upfront costs and when are they charged?
Before we start the process of helping you find a home (starting by connecting you to one of our partner agents), we require half of the one-time $5,000starter cost payment to be paid. This payment is 100% refundable if ZeroDown does not end up purchasing a home for you, but is non-refundable once ZeroDown makes an offer on a home for you that is accepted by the seller.
Once we close on that home (meaning the home is now ready for you to move into), the other half of the$5,000 starter cost will be due. The starter cost helps us cover the costs associated with the purchase of your home.
What are the monthly costs of residing in a ZeroDown home?
Your monthly costs on a ZeroDown home will depend on the value of the home you select. You can click here to see how much the ZeroDown monthly cost will be for different home values.
Do I need to pay property taxes or buy home insurance?
No. ZeroDown handles property taxes and home insurance. However, ZeroDown does require you to obtain renter’s insurance.
Do I need to pay the monthly HOA fee (if applicable)?
Yes, ZeroDown will add any HOA fees on top of your regular monthly payment. However, ZeroDown makes the payment and coordinates directly with the HOA on your behalf.
Who’s responsible for home maintenance costs?
Since ZeroDown customers generally are serious about wanting to eventually own the home, you are responsible for typical maintenance and repairs.
Exceptions to this are repairs necessary to keep the home habitable, which will be covered by ZeroDown. Structural issues, HVAC repairs and roof repairs are a few examples.
In either case, our concierge service is available to help you find and book maintenance providers or discuss issues with the home, making caretaking as convenient as possible!
Are my monthly payments tax deductible?
No. By using ZeroDown, you are not using a mortgage, so your monthly payments are not tax deductible.
What is the ZeroDown Concierge?
The ZeroDown Concierge is our member’s only 24/7/365 dedicated service team to handle any and all requests made by our customers. This ranges from help with setting up or troubleshooting utilities to finding a quality landscaping company. You name it and we’re here to help!
Who owns the title to the home?
ZeroDown owns the title to the home until you buy it from us. Around the time you move into your home, you enter into two agreements with us:
The first is a lease agreement with a 2 year minimum commitment, which covers the monthly payment amounts, terms, maintenance obligations and your other rights and responsibilities.
The second is an option agreement, which grants you the exclusive right to purchase the home back from us at predetermined prices.
How do I buy my home from ZeroDown?
Anytime starting from 30 days after moving in and up to 36 months later, you can buy the home from ZeroDown.
We establish the future price of the home before you move in, so all you need to do is let us know you’re ready to buy and we can guide you through the purchase process.
How long do I have to live in a ZeroDown home before I can buy the home from ZeroDown?
Once you get the keys, you’ll have the exclusive option to buy the home from us anytime after 30 days and up to 3 years later (as described above).
How do you determine the price of a ZeroDown home when I am ready to buy?
You buy the home from us at a predictable annual appreciation rate of 2.5%. As part of our Option Agreement (agreed upon before you move in), we outline the purchase price of the home depending on when you plan to purchase the home from ZeroDown. The process is completely transparent and you will know the agreed upon purchase price from the beginning. No hassle, no surprises!
How long can I live in a ZeroDown home before I purchase it for myself?
Up to 3 years.
What happens if I want to leave my ZeroDown home before 2 years?
The minimum commitment is 2 years.
What happens if I want to leave my ZeroDown home after 2 years?
After you have lived in the ZeroDown home for the minimum term, you can leave or decide to renew. Keep in mind, if you would like to move into a new ZeroDown home, that is also an option.
Can I make improvements to my ZeroDown home?
You can make minor improvements such as painting the walls, changing the carpet, hanging pictures or adding new appliances. Major improvements - such as remodelings, replacing systems like HVAC, anything that requires construction, etc. - are not permitted until you buy your home. If at any point you are not sure if something counts as a minor or major improvement, you can always contact us and ask.
Can I sublet or sublease my ZeroDown home, or put it on Airbnb?
You cannot use your ZeroDown home as an investment or income property. You can only use the ZeroDown home as your primary residence (until you buy it from us), meaning you cannot sublet or sublease your home or any portion of it, including on rental platforms like Airbnb or VRBO.
How am I protected if anything happens to ZeroDown?
We have arrangements with a backup service company who would take over and manage the homes.
What happens if my home depreciates in value?
In the event that your home loses value (or for any other reason), you are free to move out at the end of your lease term (minimum of 2 years). There is no obligation to buy the home from us.
What happens if my home appreciates in value?
We predetermine the future purchase price of your home at the time you move in, so if the home is worth more than this predetermined price when you buy it from us, you end up capturing all of that extra value (if you buy the home).