The Mortgage Collaborative (TMC) recently said it raised $2.2 million in a pre-Series A funding round for Home Lending Pal, an Orlando, Fla.-based company working to develop technology to remove bias from the mortgage-lending process.
Based in San Diego, TMC, the nation's largest independent cooperative network serving the mortgage industry, said its TMC Emerging Technology Fund LP recently led the pre-Series A investment round in Home Lending Pal.
Home Lending Pal focuses on fair-lending practices by using artificial intelligence and distributed ledger technology to turn a complex home research and origination process into an easy online shopping experience for both qualified and unqualified borrowers.
Its platform assists consumers, particularly minorities and millennials, to assess their financial ability to take on a mortgage. It also guides them to take actions to improve their access to mortgage financing, and to select mortgage originators with whom they want to share their application information, based on an AI algorithm that predicts the probability to close.
Bryan Young, co-founder & CEO of Home Lending Pal, said his firm’s technology allows a “single upload of documents” to go through the underwriting process with multiple lenders “to determine if they will work with the borrower, without human biases from the upfront disclosure of age, sex, or race.”
He added that TMC “understands that progressive approaches to addressing fair lending and bridging the homeownership gap are needed.”
Steven Better, co-founder & COO of Home Lending Pal, said his firm’s technology “reduces origination friction for qualified borrowers, and allows personalized roadmaps for unqualified borrowers to become qualified.” He added that, “Financial inclusion must start with equal access, borrower data empowerment, and personalized education without sales pressure.”
Jonathan Freed, managing partner of Holland Mortgage Advisors and one of the fund’s participating limited partners, said the mortgage industry is “embracing the idea of providing educational financial resources to consumers long before they begin their homebuying journey and seek out lenders for financing options.” He said Home Lending Pal “exemplifies this concept by providing a much-needed solution to a pervasive issue.”
Orlando-based Angel Syndicate Bluewave Investment Partners, CMFG Ventures, Dallas Cowboys’ linebacker Jaylon Smith, and CMFG Ventures Discovery Fund are other notable investors who joined the round.
To date, Home Lending Pal has raised $3.5 million for its digital mortgage-advising platform, powered by AI and blockchain. Home Lending Pal said it plans to demonstrate the next phase to the Consumer Financial Protection Bureau in early September, and then release it to the public for consumer use and feedback by late September.
