UpEquity “Power Buyer” Raises $ 50 Million in Series B Financing


Austin, Texas-based “power buyer” UpEquity has raised $ 50 million in Series B funding round that the company says will help it create more than $ 1 billion of mortgage loans over the next 12 months, using technology that allows homebuyers to earn money. deals and close a mortgage in an average of 18 days.

Co-founded in 2019 by Tim Herman and Louis Wilson, UpEquity is a licensed mortgage company in Texas, Florida, California and Colorado, and has raised a total of $ 77 million to date. The latest round, split between $ 20 million in equity and $ 30 million in debt, was led by S3 Ventures.

Charlie Plauche, partner of S3 Ventures, who will sit on UpEquity’s board of directors, said institutional investors had recouped $ 77 billion from single-family homes in the past six months, “with no sign of slowing down.”

Charlie plauche

UpEquity “gives the average home buyer a shot at competing with the world’s major real estate investment firms in the home buying process,” Plauche said in a statement. “We are delighted to help level the playing field in this industry. “

The company has posted a dozen vacancies at its head office in Austin in the areas of engineering, human resources, marketing, operations and sales.

UpEquity claims that its cash purchase program is free for home buyers and that it charges as low as $ 500 for its buy before sell program to cover the cost of inspecting the current home. ‘Buyer. If the buyer’s current home doesn’t sell before their new home closes, UpEquity buys it and charges 1.95% of the resale price.

The business earns money by earning a commission on the brokerage or sale of the mortgage that buyers take out to buy their home. In states where purchase contracts are not assignable, UpEquity purchases the home in advance and drafts the mortgage afterward.

Tim herman

“By removing costs and inefficiencies from the mortgage process, our clients can offer them all-cash offers at no cost while having access to competitive interest rates,” Herman said in a statement. “They get the best of both worlds. “

Like competing power buyers Homeward, Knock and Ribbon, UpEquity positions itself as an ally of realtors by arguing that their clients are more likely to win in a bidding war when they submit a bid without unforeseen. But UpEquity is a relative laggard on the scene.

Homeward, which announced $ 371 million in new funding in May, counts Norwest Venture Partners, Blackstone, Breyer Capital, Adams Street, Javelin and LiveOak Venture Partners among its backers.

Knock – which offers its Home Swap service in 65 markets – has hired Goldman Sachs to help the company prepare for a public offering.

Ribbon raised $ 150 million last month in a Series C funding round that the company said would help it grow in half of the U.S. markets by 2023.

Orchard, another electricity buyer who employs in-house real estate agents, raised $ 100 million under a deal in September that valued the company at over $ 1 billion.

These powerful buyer startups are likely to face increasing competition from mortgage lenders who understand the benefit that cash or no-frills offers offer homebuyers in markets where listings are scarce.

Better Holdco Inc. – a vertically integrated company with mortgage, real estate brokerage and securities subsidiaries – launched a cash offer program in July that has been expanded to 45 markets in 12 states.

Evergreen Home Loans, a regional mortgage lender based in Bellevue, Wash., Now also offers a cash offering product available in 4 states, illustrating the potential for every mortgage lender to act as a buyer of to be able to.

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