Digital mortgage app Habito raises £18.5 million
What's the story
London-based start-up Habito, which is attempting to digitize the entire mortgage process, has recently raised £18.5 million in its Series B funding round. The round was led by venture capital firm Atomico, founded by Skype's Niklas Zennström. The round also saw participation by existing investors in Habito like Mosaic Ventures, Ribbit Capital, and Revolutionary (Ad)Ventures.
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A brief background on Habito
Habito was founded by Daniel Hegarty in 2015, with the aim of connecting individuals with lenders, keeping every unique individual need in mind. Unlike mortgage brokers, the start-up doesn't charge brokerage fees and claims to analyze over 11,000 mortgage products to find the most suitable one.
Expansion plans
Habito is looking to expand its reach fast
The Series B funding brings the total capital raised by the UK start-up to £27 million. Apart from improving marketing and their product, Habito is looking to invest part of the amount raised to integrate its technology with major retail banks and high street lenders for "real-time mortgage approvals". It is also looking to expand its reach to home and life insurance.
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Atomico partner explains decision to invest in Habito
"Matching borrowers and lenders in the residential mortgage space is slow, expensive and very fragmented - with around 15,000 largely offline brokers in the U.K. But the potential [of Habito] is not just in the UK, it's across multiple markets," said Atomico partner Niall Wass.
Challenges
Habito needs to sell its product to apathetic home owners
Despite Habito's efforts to streamline the mortgage process by taking it online, its dreams might be potentially hampered by the apathy of home owners when it comes to re-mortgaging. Thus, Habito has some way to go in convincing people about the benefits of using its service - something which might be aided by its proposed partnerships with major retail banks and lenders.