AmEx, Citi and Goldman invest in digital mortgage startup Better.com
Home-financing startup Better.com has raised $160 million in a Series C funding round joined by financial services giants including Citi, American Express and Goldman Sachs.
Activant Capital, Ping An Global Voyager Fund, Ally Financial,, AGNC, Healthcare of Ontario Pension Plan, Pine Brook, and Kleiner Perkins all joined the round, which brings Better.com's total funding to date to $254 million.
Better.com founder Vishal Garg says he started the firm in 2016 after losing a home to an all-cash buyer due to a "slow and antiquated" traditional mortgage process.
He used the money he had saved for the down payment to start Better.com, which works to digitise the entire mortgage process to eliminate commissions, fees, unnecessary steps, and time-wasting branch appointments. Customers are able to upload and eSign documents, get loan estimates in seconds and a pre-approval within minutes.
The firm claims to close a typical mortgage 50% quicker than the industry average - 21 days compared to 42 days. In addition, the commission-free business model promises to save borrowers thousands of dollars on up-front costs.
Better.com says it has seen 3X year-over-year growth and is currently funding $375 million in mortgages a month. The firm, which has made 550 new hires in the last year, plans to add another 400 people in sales and technology by the end of 2019.
"Similar to how Amazon upended the retail industry, Better.com is digitally disrupting the $15 trillion mortgage industry through best-in-class technology, a commission-free business model and first-rate customer support".
"The capital we’ve raised will enable us to accelerate our investment in product development, grow our strategic partnerships, expand our team and scale our platform to continue making it easier for borrowers to get home financing."