Mortgage start-up with the support of Andreessen Horowitz and WeWork founder raises 50 million US dollars
Valon just raised $ 50 million to tackle the traditional mortgage services industry. The deal was led by the venture capital powerhouse Andreessen Horowitz, while WeWork founder Adam Neumann was also involved in the deal. Neumann was in the Proptech space as an investor, recently support Alfred, a concierge service for apartment buildings.
The mortgage services industry
In general, when buying a property, the Credit is serviced by a third party. This credit service provider is responsible, among other things, for the collection of monthly mortgage and trust payments, such as B. collecting and paying taxes and filing monthly reports. The lender pays a fee for all of this administrative work instead of doing it in-house.
In return for performing these activities the servicer usually receives pre-determined service fees and other sources of income, such as late payment surcharges. With so many parties involved, all driven by different factors, increased transparency in the industry is welcome by borrowers.
According to the Valon founder, a company was named Black Knight (NYSE: BKI) Controls more than half of all US home loans. CEO of Valor called, “This stranglehold has driven service costs by nearly 250% over the past decade, and fees are passed straight through to the borrower.”
Valon is working to challenge the status quo to enable a more efficient process with much more transparency to pass savings on to homeowners.
The company says it has obligations from servicers that will result in an estimated volume of services of $ 10 billion in 2021. Valon is currently in every state except New York, which is expected to come on board later this year.