HomeLight, an online real estate platform that uses data and technology to connect home sellers with buyers and real estate agents, is getting into the mortgage business, following in the path blazed by companies like Zillow, Redfin, and Opendoor.
But unlike Redfin and Opendoor, which each launched their own mortgage business, HomeLight is taking the Zillow track of buying instead of building. When Zillow expanded into mortgages last year, it did so by buying Mortgage Lenders of America, which was subsequently rebranded to Zillow Home Loans.
HomeLight is taking a similar approach. The company announced Wednesday that it has acquired Eave, a digital mortgage lending startup that launched last year.
Eave began lending in Colorado in 2018, promising a “revolutionary” lending experience that digitizes and simplifies the mortgage experience by automating 70% of the mortgage process.
Eave claimed that it has “re-envisioned the whole mortgage experience,” can provide a full and complete underwriting in 24 hours, and close a borrower’s loan within 21 days.
Since launching in Colorado, Eave has since expanded to California, Colorado, Washington, Oregon, Pennsylvania, and Texas.
With the acquisition, Eave’s digital mortgage platform will power HomeLight’s home loans division, which is launching Wednesday in those same six states.
The idea behind the expansion, according to HomeLight executives, is to make the home purchase process easier for buyers by giving them the “power and certainty of all-cash offers.”
According to a post from HomeLight’s executives on the company’s blog, by giving buyers a full underwrite within 24 hours, the borrower’s offer will look much stronger than a “flimsy pre-qual or partially verified pre-approval.” HomeLight claims that Eave’s system has allowed 90% of the company’s clients to win the first offer on their home.
The approach is similar to how Zillow and Redfin are looking at the mortgage business as it relates to their primary real estate focus. As former Zillow CEO Spencer Rascoff said last year, online real estate companies that also originate mortgages are able to provide “transactional lubrication” to the home buying experience.
To no surprise, both Eave and HomeLight view the deal as beneficial to all parties.
“This is a win-win-win for buyers, sellers, and for agents. Buyers and sellers are fully informed and underwritten before meeting HomeLight agents,” said Eave Co-Founder and Chief Operating Officer Saro Vasudevan.
“With our mortgage and escrow services, consumers and their agents can focus on the home, and not worry about the painful details,” Vasudevan added. “The frictionless real estate transaction is a reality for HomeLight and Eave. And, every real estate agent is included.”
Jack McCambridge, co-founder and CEO of Eave, shared similar sentiments.
“We’re excited to join forces with a team deeply committed to putting people first. HomeLight uses technology to empower homebuyers and sellers in ways that delight them,” McCambridge said. “The process as it is today is bewildering and unpredictable. It’s fundamentally broken. Together, we are making it simple, certain and less costly throughout.”
Financial terms of the deal were not disclosed.
“We’re thrilled to bring Eave’s stellar product and team into the HomeLight family,” said Drew Uher, HomeLight founder and CEO. “By harnessing Eave’s proprietary mortgage technology, we believe we can significantly improve the home buying process for everyone involved: buyers, sellers, and agents alike.”
Published at Wed, 10 Jul 2019 21:30:00 +0000