Flat-fee brokerage Reali announced Wednesday that it has acquired a loan company and is launching its own, in-house mortgage service.
Reali Loans, as the new service has been dubbed, is the result of the company’s acquisition of Lenda, a mortgage startup with a tech platform that streamlines the lending process. In a statement, Reali said that Lenda will be integrated into Reali Loans “in the coming weeks” and that the resulting service will “include no origination fees, easy online customer experience, fast approvals, and competitive rates.”
“By combining Lenda’s mortgage lending capabilities with Reali’s home buying and selling platform, Reali customers will enjoy a seamless end-to-end real estate experience while saving thousands of dollars in commission fees,” the statement added.
Reali founder and CEO Amit Haller told Inman that the Lenda acquisition came after a long-running search for a partner that could help drive expansion into new parts of the real estate transaction. Haller said that Reali was ultimately drawn to Lenda thanks to its focus on customer service, and its ability to prequalify a would-be buyer in seconds rather than the more typical hours or days.
“It’s absolutely the right fit for us,” Haller added.
Reali executives also hope to expand into other parts of the real estate transaction as well, with Haller saying for example that the company in the future may offer title services. Though other programs and acquisitions have not been announced, Haller said the goal is to eventually become a “one-stop shop” that can handle all of consumers’ real estate needs.
“We are looking into incorporating more and more components,” he said.
Reali first launched in California’s Bay Area in 2016, then gradually began expanding across the entire Golden State. Haller said there are no immediate plans to move Reali’s brokerage services beyond California, though the eventual goal is to operate in all 50 states.
The company represents both buyers and sellers and uses an app to facilitate communication leading up to and during a transaction. Consumers on both sides of a transaction pay a flat fee — which varies depending on the price of the property — and the company claims that it saves people an average of $20,000.
San Francisco-based Lenda launched in 2012 and early on developed a platform that it described as the “TurboTax for mortgage.” In 2017, the company announced that it had raised $5.25 million in Series A financing.
Reali did not publicly disclose the financial details of its Lenda acquisition.
Prior to Wednesday’s announcement, Lenda had been operating in 12 states including California, Oregon, Georgia, Texas and Pennsylvania. Haller said that Lenda will continue to operate in those markets, albeit under the new Reali Loans banner. The company also will continue to serve its existing customers.
Going forward, Reali buyers also will have the option to use Reali Loans or go with their preferred lender, Haller said. However, he argued that Reali’s rates will be competitive with, and potentially better than, those offered by competitors because his company is more efficient.
“There’s no need to operate at a high margin for these loans,” he said, “and we can transfer the entire savings to the consumer.”
The idea of consumer savings animates everything that Reali is currently doing, including its flat-fee brokerage business. Haller described industry standard agent commissions — which are typically around 6 percent of a home’s sale price — as “outrageous” and “way too much for what we are doing.” And Reali, he argued, can offer the same services at a fraction of the price.
“We feel like we are on a mission,” he continued, “to make things better for the consumer.”