in inman connect las vegas, July 30-August. In January 2024, noise and misinformation will be banished, all the big questions will be answered, and new business opportunities will be revealed. would you like to join.
With $3 million in new seed funding, Assumable Mortgage Platform Roam expands its reach, helping buyers “turn back the clock” in new markets including Chicago, Jacksonville, and Tucson We are helping people finance their home purchases at interest rates not seen in years.
Technically, a seller who is repaying a government-backed FHA, VA, or USDA mortgage can offer a qualified buyer the option of assuming the loan balance at any interest rate. . However, buyers need to compensate the seller for the equity they have built in their home, so they often need to take out a second mortgage.
In announcing this, Second round of funding Since its launch last year, ROHM said it is now partnering with mortgage lenders. spring EQ To provide a second mortgage. Depending on the assumed mortgage rate and the size of the second loan, Rohm says it can typically offer a blended rate of 4 percent to 5 percent (see) Published on company website).
Raunak Singh
“For a lot of people, it feels like a portal to the past, right?” Roam founder and CEO Raunak Singh told Inman. “This is like a way to turn back the clock and buy a home. They took the chance to buy at a lower rate in 2021.”
Roam announced a $1.25 million seed funding round in September led by Founders Fund partner Keith Rabois, and has now raised a total of $4.25 million. Lavoie also led the latest seed funding round, with participation from new investors including DoorDash CEO Tony Xu, Figma CEO Dylan Field, and Upstart co-founder Paul Gu.
Roam helps homebuyers find homes for mortgage underwriting, manages the process on behalf of buyers, sellers, and agents, and charges buyers a 1 percent fee through closing costs. To do. With expansion into new markets, Rohm says he now services 35% of U.S. homes with his FHA and VA loans.
Singh said demand from buyers, sellers and agents is strong and the company plans to offer the service nationwide by the end of the year.
After the company was featured in the May 9 newspaper. new york times StorySingh said he has received hundreds of emails from buyers, sellers and agents wanting to know when you will be coming to my city.
Before partnering with Spring EQ, Singh said ROHM would connect homebuyers needing a second mortgage with a number of smaller preferred partner lenders, which is uncertain and fragmented. He said that it could be a complicated process.
The partnership with Spring EQ provides economies of scale and streamlined processes, and also allows borrowers to obtain better interest rates, as Roam receives no compensation for referring borrowers to Spring EQ.
“They take the fees they would otherwise pay us as if we were a retail partner and factor that into their pricing,” Singh said. “So the customer gets a big discount, and that’s a win for the customer. We now have a national lender that can work with us in any state where they want to buy a home. , we offer very competitive pricing as our customers receive rebates.”
Roam is not compensated and our relationship with Spring EQ is not exclusive.
“We are content to direct our customers to those who charge the lowest rates and provide the best service in the shortest time to closing,” Singh said.
In theory, any mortgage lender can help homebuyers explore the option of taking on a mortgage when purchasing a home. On that website, Promoting New American Funding The potential savings in the estimated closing costs of an FHA loan as compared to a conventional loan.
Roaming and Competitor-like FHA Pro subscription based AssumeList The company says it can also help buyers find homes that they can afford mortgages on. Multi-listing services often have a “Cash on Existing Loan” box that real estate agents check to indicate which loans they can accept. Home buyers can also search her Realtor.com by: check the box For mortgages assumed in the price drop-down menu.
Singh said ROHM also has expertise in dealing with difficult loan servicers when transferring mortgages from sellers to buyers.
“We make assumptions for all the major servicers and know most of the people who run customer service departments, so we can make sure our customers receive the best service possible. ” he said. “If we run into an issue where a file is not being processed in a timely manner, we know who to escalate to ensure the block is lifted.”
Rohm claims the typical buyer can save $12,000 a year compared to purchasing a home with a traditional mortgage and can be on the closing table in 45 to 60 days. .
December, Department of Veterans Affairs (VA) Alert lenders and servicers We have outlined the obligation to process assumptions in a timely manner and the penalties for non-compliance.
“High interest rates make most loans attractive to buyers to underwrite, but lenders and servicers are completely unprepared for the flood of underwriting requests,” said FHA Pros Founder Chris Gardner, CEO and chief executive officer, gave the advice in his book. Posted on February 29th on the company’s website.
“The cynic in me says that this attitude and incompetence is intentional, as these companies would rather repay low-interest loans than continue to shore up their battered balance sheets. , because they want to return the capital in order to make a loan.” [then-]The current interest rate is 8 percent. ”
Get Inman’s Mortgage Overview Newsletter delivered straight to your inbox. Get the world’s biggest mortgage and closing news all in one place every Wednesday. Click here to subscribe.
Email Matt Carter
