A frustrating home-buying and subsequent refinancing experience led Rajesh Bhat to wonder why a better solution didn’t exist for borrowers. He spent a year researching the issue, and Roostify emerged as the answer.
“Most consumers have come to expect an ability to have an end-to-end online experience in which everything is centralized,” he said.
“Real estate is very far away from that. The fact is that is a very offline opaque and inefficient process. Opaque in the sense as a consumer you don’t know what’s happening behind the curtains. There are a lot of services that are initiated for which you pay, but you don’t select those services and you’re depending on someone else to tell you and you pick up the bill.”
Roostify is a web and mobile service that makes the home-buying experience easier and quicker by simplifying the loan application and digitizing the application-to-closing process. Consumers can submit a full loan package in minutes and loan officers can conduct closing activities with their client, all electronically and in one place.
The Silicon Valley startup has 10 employees, including co-founder and one of Google’s first engineers, Harry Cheung. In fact, the founding team members all hail from Washington University in St. Louis, where Bhat majored in computer science. Prior to Roostify, Bhat was a management consultant for 13 years, with stints at Ernst & Young and a boutique advisory firm based in Washington, D.C.
“The team continues to be predominantly people without mortgage experience,” he said. “We all come at this from the perspective that we went through this as consumers, but we’re working with big banks so we understand how compliance plays into it.”
Roostify is processing thousands of applications a month, with a significant percentage using online integration tools that pull data from trusted sources, such as bank accounts and income from W-2s.
“All of this is impacting the decision process for the banks who have the ability to receive a pristine high-integrity loan application,” he said. “We’re focusing on improving the consumer experience and digitizing the experience for the lender.”
Roostify’s business model is attracting attention from leading banks and mortgage lenders, and also investors. The company has raised more than $7.5 million in funding and was accepted into the Wells Fargo Accelerator program in October. The coveted program helps startups create solutions for financial institutions and enterprise customers.
Bhat said he plans to add more engineers to build out the product and hire a sales team, which currently doesn’t exist, to market and sell to the marketplace.
“The opportunity is really to provide a different standard for transacting mortgages than what exists today,” he said. “What we’re doing is building horizontally based on our road map and we’re building vertically based on our customer demands.”
The goal is to deliver that experience where customers can do everything from the home purchase and mortgage transaction in one place and digitize that as much as possible, so other stakeholders can drive more efficiencies in their work flows, he added.
Roostify’s partners include Fannie Mae, Ellie Mae and financial institution application program interface (open source) provider Yodlee. Roostify also has signed on customers including National Bank of Kansas City and FirstCal.
Customers can customize the private-label product, add their brand differentiation and build on top of the API-driven platform.
“What I’m most excited about is the feedback we get from our customers and our prospects on how different the solution is and how great it is for the consumer and how it makes them think about how they originate in the future,” he said.