At a time when a pandemic makes face-to-face meetings rare, Homewise offers an online solution to homebuyers shopping for a mortgage.
Chief executive officer Jesse Abrams co-founded the North York-based company with Carlos Medeiros in late 2018.
The two men have experience in the technology, marketing and banking fields and came up with a way for homebuyers to “efficiently, easily and transparently get their best mortgage in minutes from many lenders,” Abrams told RENX.
Homewise clients sign up online and book a 10-minute phone call with an advisor. The company’s technology and mortgage experts then negotiate with lenders to obtain the three best mortgage options, providing clients with a view of rates, key features and options.
The Homewise website has links to affordability, payment and closing cost calculators, while personal advisors guide clients at each step, from mortgage approval to move-in.
Homewise’s goal is to continue to add more technology to make its experience better for both clients and lenders. Abrams said it has new products that will launch over the next 12 months that he can’t yet talk about.
“Our business has continually grown every month, with more and more Canadians using our service,” said Abrams. “In fact, in the first six months of this year we will surpass our mortgage volume from all of 2019, even as COVID has slowed the industry.”
How Homewise works
Homewise deals with mortgage-seekers across Canada, excluding Quebec. It works with more than 30 lenders, including major banks, credit unions, and monoline and private lenders.
“We have great relationships with our lenders,” said Abrams. “We continually add more lenders to our platform and have been lucky enough to get better and better status with lenders based on high funding ratios.”
Since Homewise works with A, B and private lenders, Abrams said it can find solutions for a variety of mortgage-seekers.
“Even within the A category, different lenders provide options that would be better suited to different clients.”
Homewise’s service is free for mortgage seekers, as the company is paid by lenders when mortgages close. The company gets paid from 80 to 120 basis points of the mortgage principal, so a $500,000 mortgage at 80 basis points would be $4,000.
“As we are a tech company, we can be more efficient,” said Abrams. “Because of this, we parlay our savings on to our client and we take a lower commission to get better rates for clients.”
Competitors and partners
While Homewise is vying for the same clients as banks and classic mortgage brokers, the company’s main competitors are online rate aggregators.
“Unfortunately, those are very basic services that focus only on rate,” said Abrams. “At Homewise, we specifically match our clients’ profiles with the best options from our 30 bank and lender partners.”
Homewise has digital partnerships with realtors, offering them an opportunity to expand their toolkit and provide more value to their clients.
Abrams said Homewise provides them with transparency into the client process with a personal dashboard that keeps them informed about their client’s mortgage status.
“They will also be set up with an advisor from our team that will keep them updated at each step. Once the deal is funded, they can share in the revenues we get from the lender or provide it in the form of a gift to their clients.
“Clients continue to look for one-stop shops, and we help our partners provide more services while accelerating their digital transformation.”
Abrams said partners receive a personal co-branded website and application, or they can “iframe” the application directly into their own website.