Truehold Home-Sale Leaseback Review
What we like:
Sell your home when the market is hot to earn top dollar, but live in it until you can buy elsewhere.
| Accessible home value | 100% |
| Remain in home? | Yes |
| Time to fund | Around 30 days |
| Availability | Only in 8 U.S. cities (listed below) |
After you sell your home, you might not have a new place lined up yet. A leaseback occurs after you sell your home. The new owner immediately leases it back to you for a set time.
This is appealing to sellers who need more time to move out, and it’s an option for buyers who don’t need to move into their space right away but want to lock in the home or a low mortgage interest rate.
Truehold specializes in home-sale leasebacks, allowing sellers to sell their homes and then lease them back until they’re ready to leave. Since launching in 2021, Truehold works in a handful of Midwestern cities, including Kansas City, St. Louis, and Cincinnati. The company has used sale leasebacks for more than 200 residents to sell their homes and sign lease agreements to continue living in them.
In this review:
- How to sell your home and rent it back with Truehold
- Pros and cons of a Truehold home-sale leaseback
- What do Truehold’s customers say?
- How do I apply with Truehold?
- Does Truehold have a customer service team?
- Truehold alternatives
How to sell your home and rent it back with Truehold
If you live in an area where Truehold operates, you must own a single-family home valued between $100,000 to $500,000.
You’ll also need one of the following:
- Sufficient equity in your home to cover at least three years of rent payments
- A high credit score to prove you’re responsible enough to make rent payments
Once it determines you’re eligible, Truehold executes the purchase of your home in as little as 30 days. The lease agreement begins right after you close on the sale of your home.
Like a traditional lease agreement, Truehold manages regular maintenance of the home, and you may make small cosmetic updates. You can expect small annual rent increases, but you’re not obligated to leave your home after a set time.
Truehold calculates the sale of your home and your rent by using comparable rentals in your area and specific to your neighborhood, the square footage of your home, and amenities.
You’ll get market value for your home and pay market value for your rent. You’re on the hook for paying upward of 6% of the home’s value in real estate commissions at the home sale’s closing.
Pros and cons of a Truehold home-sale leaseback
Pros
- Quick access to cash. You’ll immediately get a payout for the equity you have in your home, and your only financial obligation is ongoing lease (rental) monthly payments.
- Minimal fees. Aside from the 5% to 6% commission, Truehold charges no other fees for a leaseback.
- Removal of expensive home costs. You’re no longer on the hook for home maintenance costs, homeowners insurance, property tax, and similar costs.
- Rent as long as you’d like. As long as you can continue making monthly rent payments, you can often stay in your home as long as you’d like. Other leaseback offers might let you rent for just a short time, such as a few weeks.
- Fast closing time. Since there’s no public listing, you won’t have to prepare your home for staging, pictures, open hours, or private viewings. The time from start to close could be as little as 30 days.
Cons
- Lose access to appreciation. While you’ll get your home’s full value (minus what you still owe) at the sale, you won’t have the chance to build up further equity once you sell.
- No more tax breaks. As a renter, you won’t qualify for any state or federal tax credits or deductions for homeowners.
- Big tax payment. You’re on the hook for capital gains tax for profits of $250,000 or more for single filers and $500,000 or more for couples filing jointly.
- Potentially high rent payments. If you live in an area with a high cost of living, your rent payments will often reflect the average rate for your home size and neighborhood. Rent payments could price you out of your leaseback.
- Only available in select cities: At the time of writing, Truehold only services Cleveland, St. Louis, Pittsburgh, Kansas City, Cincinnati, Indianapolis, Oklahoma City, and Tulsa.
If you’re unsure whether Truehold is right for your home equity needs, check out our full list of home equity companies.
What do Truehold’s customers say about the company?
Customer ratings can tell you what working with a company is like. While Truehold is still relatively new, its customer reviews give an idea of what you can expect.
| Source | Rating | Number of reviews |
| Better Business Bureau (BBB) | 4.31 out of 5 | 42 |
| 3.8 out of 5 | 9 |
Ratings collected on February 23, 2023
What customers are happy with:
As a 62 year old single female life changes put me in complicated situations having an opportunity to regain some stability again was challenging. Yet Truehold gave life a little more hope for me. My loan officer took time to listen all while remaining professional and business forward. The stress of selling 30 years of my life was peaceful due to ability to see passed numbers. Thank you.
—BBB review
What customers are unhappy with:
I was looking to sell my house and still rent it. I had some major repairs that needed to be done and didn’t want to pay for it. Truehold gave me an offer knowing all the issues(I gave them quotes for repairs). The offer took into account the cost of the repairs and was about $30-40k under market value. I agreed to the price and after inspection they decided to cancel the offer because of the issues that I previously brought to their attention and accepted the offer knowing those were already accounted for. I do believe that the announced turn in the housing market in my area played the bigger role and they used the “issues” as an excuse to back out of the deal. I can not recommend this service to anyone looking to sell their house. Go the traditional route with a quality realtor.
—BBB review
These testimonials can help you decide whether working with Truehold might be right for you.
How do I apply with Truehold?
Truehold has no formal application, but here’s where to start if you’re interested.
Complete the form to ensure your address is eligible with Truehold. Once you get your information toolkit or speak to an advisor, you’ll be directed to the next steps, including a home inspection and appraisal. Remember: Not all homes are eligible, so if your home is valued at less than $100,000 or more than $500,000, or you don’t live in a coverage area, you may want to consider alternatives.
If you and your home are good candidates, you’ll chat with a representative to confirm you understand the cost considerations. For instance, can you afford the potential monthly rent payments and closing costs of up to 6% of the home’s value?
Since everyone’s home circumstances are unique, you’ll connect with an advisor to ensure this is the right option for you and your future.
Does Truehold have a customer service team?
You can speak to a Truehold advisor when you call 314-353-9757. The advisor will review the set criteria for qualifications, including ensuring your address is in an eligible coverage area and your home is within range to sell.
If you’re working with Truehold, you’ll get a dedicated service number to speak to a representative about your pending sale.
You can also email hello@truehold.com any time, and someone will contact you.
Truehold alternatives
Truehold’s home-sale leaseback isn’t an option for everyone, especially considering its selective coverage area.
Alternatives include the following:
- Another home-sale leaseback company. Truehold isn’t the only option for home-sale leasebacks. Check out other home-sale leaseback companies we like.
- Reverse mortgage. A reverse mortgage is when you borrow money from your home’s equity to secure a loan. Your home is collateral to secure the loan, and you’ll repay it when you move. This is only available to homeowners who are 62 years and older.
- HELOC. A home equity line of credit (HELOC) allows you to borrow money based on a percentage of how much equity you have in your home. During the “draw” period, where you take out money against your limit, you must make minimum payments over a set time, often 10 years. Then the repayment period kicks in, which is also a fixed term for a set number of years.
- Home equity loan. A home equity loan is a lump-sum loan where you can borrow based on your home’s equity. You’ll start immediate repayment and make fixed payments over several years.
Home equity loans and lines of credit use your home as collateral.
Before you get into a home-sale leaseback, ensure you’re eligible and it’s the right move for you. Compare it to other options and make the best choice for you and your family.
The post Truehold Home-Sale Leaseback Review appeared first on LendEDU.