Mortgage startup BoardRE announced its launch in Colorado Tuesday, pledging to level the playing field for homebuyers by upgrading their offers to all cash.
Board uses its resources to buy a home on behalf of clients it has approved for a mortgage in an all-cash deal. Once the loan is set to close, Board sells the home to the buyer at the same price in a transaction that takes two weeks or less, and lends them the money to buy it back – all at no additional cost to the homebuyer, because Board generates its revenue from the origination fee.
Board, which says it has already completed several successful transactions, cites Redfin data stating that cash buyers are 97% more likely to win in a multiple-offer situation than mortgage buyers, and that they often receive a 5% discount in the asking price compared with buyers with a mortgage.
“Our goal is to ensure our borrowers can compete effectively with all-cash buyers, so they don’t lose the home of their dreams to to an unfair advantage,” said Co-Founder and CEO Adam Pollack. “Board is built to allow anyone, whether it’s a first-time homebuyer with 5% down or Silicon Valley engineer, to offer sellers the speed and certainty of an all-cash deal. We are building a fairer, cash-only future of real estate that ensures anyone who can afford a mortgage has an equal shot at winning their dream home.”
Backed by Y Combinator, Board has some big-name investors behind it, including Peter Thiel’s 1517 Fund, Global Founders Capital, DN Capital and Signal Fire Founding Parner Ilya Kirnos.
It recently closed its first round of funding, raising $7 million in debt and equity, which the Denver-based company said it will use to launch in the nation’s most competitive real estate markets.
“When it comes to buying a home, I’ve never heard anyone say they’ve had an ‘enjoyable mortgage experience’,” said Co-Founder and COO Nick Friedman. “We don’t want a weak offer adding to the list of disadvantages a mortgage buyer experiences, so Board levels the playing field by providing any buyer it approves with the strongest offer in real estate. With Board, any buyer is an iBuyer, primed to compete against any offer.”