Better Mortgage becomes billion-dollar originator

Saw 400% year-over-year increase in users

Online lender Better Mortgage, which launched in January 2016, recently surpassed $1 billion in mortgage originations.

According to data provided by the company, Better Mortgage claims it was the third fastest online lender to reach $1 billion in originations, trailing only Goldman SachsMarcus and SoFi.

Better has expanded its business significantly in its two years of business.

The company now operates in 14 markets, having added Texas earlier this year.

Better Mortgage is also licensed in Arizona, California, Colorado, Connecticut, Georgia, Illinois, North Carolina, New Jersey, Oregon, Pennsylvania, Washington, and Washington, D.C.

Initially, the company focused on the refinance market, but now the company also offers purchase mortgages.

Last year, Better Mortgage announced that it raised $15 million and planned to use the money to launch and expand its home purchase finance product on the company’s website,

The company is backed by Goldman Sachs, which invested in Better Mortgage on two separate occasions.

Goldman Sachs took part in the company’s $25 million Series B funding round and previously participated in the company's $30 million Series A funding, which marked the first investment in a mortgage bank by a major Wall Street firm in almost 10 years.

Better Mortgage is also backed by Kleiner Perkins and Pine Brook.

According to the company, in 2017, Better saw a 400% increase in its user base on a year over-year basis.

The company also recently agreed to take part in a program along with Fannie MaeQuicken Loans, and Citizens Bank that allows Airbnb users to use income from home-sharing to refinance their mortgage.

Better CEO and Founder Vishal Garg celebrated the company’s milestone and said that he has no plans to slow down.

“I started Better with the down payment I’d saved to buy my first home but wasn’t able to. Why? Because of an inefficient, antiquated mortgage process which functioned as if the internet had never been invented and caused us to lose the home to an all-cash buyer. I knew then that the entire industry needed to dramatically change,” Garg said.

“Many believed that we were crazy for trying to build an online, commission-free, direct-to-consumer mortgage company when so many well-capitalized companies were abandoning their origination business. I saw it as an opportunity, however, to reimagine home finance from the ground up,” Garg continued.

“Hitting this milestone is proof that we are onto something. That you can build a successful mortgage company and get to scale when you focus on improving the process for the consumer,” Garg concluded. “We’re helping people afford more home by leveraging technology, benefits from pass-through savings, and benefit from the certainty provided by our awesome support and education from our non-commissioned loan consultants.”

[Update: This article is updated to reflect Goldman Sachs' funding of Better Mortgage.]

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