Mortgagetech player UpEquity landed $50 million this week to help democratize home buying. The investment brings the Texas-based company’s total funding to $76.7 million in combined debt and equity.
The Series B round, which consisted of $20 million in equity and $30 million in debt, was led by 3 Ventures with participation from Next Coast Ventures, BP Capital Management, Alumni Ventures, Gaingels, Launchpad Capital, and Early Light Ventures.
UpEquity was founded in 2019 and, simply put, is a digital mortgage provider. The company offers three main products for potential homebuyers. Buy with Cash helps average homebuyers make all-cash offers on a home, Buy Before You Sell enables buyers to purchase a new home before selling their current one, and UpEquity’s third solution enables homeowners to refinance their existing mortgage.
For the end consumers, the cost of getting a mortgage from UpEquity is similar to costs they would incur with a traditional mortgage lender. UpEquity aims to compete by not only helping buyers make an all-cash offer, but also by doing so quickly. UpEquity’s average time-to-close is 18 days.
“At the end of the day, our vision is to create equal access to the American dream through frictionless, on-demand homebuying, and it starts with bringing technology into the underwriting process,” said UpEquity Co-Founder and CEO Tim Herman. “By removing cost and inefficiencies from the mortgage process, our customers can make all-cash offers at zero cost to them and still get access to competitive interest rates. They get the best of both worlds.”
UpEquity is part of a newly emerging set of companies called Power Buyers that purchase a home on a buyer’s behalf using cash, then sell it back to them using a traditional mortgage. Rivals in this space include Knock, Homeward, Orchard, and Blend. Like these players, UpEquity makes money on interest paid on the mortgage and commissions from reselling loans.
UpEquity’s revenue has grown 500% year-over-year. The company anticipates it will originate more than $1 billion in mortgages over the next 12 months.
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