Home Lending Pal
AI-based mortgage advisor for low and moderate income individuals
Company: Home Lending Pal operates a lending software designed to create artificial intelligence mortgage advisors that predict the likelihood for mortgage approval along with hidden ownership cost during research. The platform, which targets individuals of low and moderate income, empowers consumers to make home-buying decisions, enabling clients to get affordable risk data that is usually only available to lenders.
HQ Location & Year Founded: Orlando, 2017
Founder: Bryan Young, co-founder and CEO, is a former Bloomberg Businessweek “Top 25 Under 25” Entrepreneur and E&Y Entrepreneur of the Year Finalist with four prior exits. He built his first 7-figure company at 18 and his second one at 23. He has led global digital strategies and tactical execution for the likes of the 2012 DNC and President Barack Obama, Microsoft, Panasonic, Xerox, Zillow, CenturyLink, and others. Bryan has worked for organizations such as Time Warner, Adobe Systems and SkyScanner. Bryan studied entrepreneurship and marketing at North Carolina State University and Colorado State University Global. He also holds an executive leadership certificate from Cornell University. Bryan serves on the Black and Hispanic Community Development Advisory Board of Quontic Bank, a New York-based digital bank.
Funds Raised and VC Investors: $4.5 million from BlueWave Investment Partners, CUNA Mutual Discovery Fund, Deepwork Capital, IA Seed Ventures, StarterStudio, TMC Emerging Technology Fund. HLP has participated in 10 accelerator programs to date.
Where did the idea for Home Lending Pal originate?
I had been working in the mortgage space and consulting companies like Zillow. I became more and more familiar with the problem of low to moderate income (LMI) families seeking credit and the inability to obtain mortgages from banks and other lenders. Meanwhile, with my background having worked for many years in demand generation as well as having started multiple companies in the past, I felt that I had the opportunity to create a business that could make a real difference.
What is the key problem that Home Lending Pal intends to solve?
The home ownership gap today for people of color is worse than in the days of segregation. LMI communities in general, and Black and Brown people, face structural barriers that are very difficult to overcome. Half of the US population are in the category of LMI and will face great difficulties obtaining mortgages and becoming homeowners due to the credit scoring system that exists today. Quite a few people would be able to improve their credit profiles by factoring in rent payment history and by taking advantage of programs offered by Fannie Mae and Freddie Mac. There are many consumers who are qualified for a mortgage, but simply do not believe that they are. This is where we can help. We draw on an individual’s full profile that goes beyond their basic FICO score. We connect them to banking services with personal feedback, and we’re able to help match would-be homeowners with the right lenders who are willing to look holistically at an applicant’s profile.
How are you most differentiated as a service?
Our consumer platform allows the user to create a profile that helps to determine an appropriate down payment, as well as finding credit programs, local initiatives for closing costs, qualified lenders and more. Users can ask questions via voice or chat, and we provide a “digital twin” that better serves the LMI community throughout the lending process. Moreover, we work with previously declined applicants and help them to improve their credit and financial situation. We reward with cash toward closing earned from good financial habits through our two-sided marketplace with lenders.
We take aspects of offerings from companies like Lending Tree and NerdWallet and tailor them to the LMI community. Our marketplace is up and functioning and we are developing licensing agreements with many lenders, including Rocket Mortgage and Wells Fargo. By democratizing data among the LMI community, we assist with down payment, affordability and finding opportunity. Our platform includes a conversational mortgage assistant that utilizes AI. For lenders, we are a lead generation engine that taps into previously underserved buyers.
What are the company’s key accomplishments to date?
I am proud to say that we have signed up dozens of lenders to our platform and are in the process of rolling out pilots to support affordable housing with the likes of Fannie, Freddie, Ginnie Mae, Wells Fargo, IBM, and the Department of Housing and Urban Development. On the borrower side, we received 20,000 applications in our first eight weeks. We were able to pre-approve 12% of these, compared to an industry average of 1-3%. A third of these applicants, who are disproportionately African American, have already successfully purchased a home.
What lies ahead in the plans for Home Lending Pal?
We will continue to roll out more lenders to provide greater possibilities and choice for prospective LMI homeowners. We are also looking at providing refinancing and other services to fill gaps in this market. The product will be best-in-class as we grow our team to develop more AI/ML tools, broaden our IP and regulatory protection, as well as scaling up on both ends of our marketplace of borrowers and lenders.
Ron’s Take
Home ownership is one of the driving forces of economic independence. As more individuals build equity while establishing peace of mind for their families, people will be able to break down structural barriers. Families of low and moderate income have struggled for ages to attract loans that help them to crack this critical life milestone. There is movement and public will now to recognize these barriers for what they are and do something about it. Platforms such as Home Lending Pal are enabling lenders to take a wider view on home loan and mortgage eligibility, while at the same time demonstrating to individuals that they may in fact qualify for home ownership through some basic education and support. Increasing levels of home ownership is not just sound for the economy, it is life affirming for those of modest income who are working hard to bring financial stability to their families.