A new online-only mortgage lender, Clara, says it is going to “change the way people buy homes.”
The California-based company was co-founded by Jeff Foster, who previously worked at the U.S. Treasury on housing finance reform following the financial crisis, and Lukasz Strozek, who spent six years at Bridgewater leading the firm’s digitization efforts.
So far, Clara is only operating in California, but it will soon be rolling out its services in Colorado, Oregon, Washington and Arizona, with more markets to follow, the company says in a press release.
Clara recently landed $27 million in equity financing from lead investors Redpoint Ventures and Venrock, as well as from a group of industry experts, entrepreneurs and executives. The company says its goal is “to build a new end-to-end online lending platform focused on delivering a more transparent and empowering customer experience.”
“We’ve brought together a unique team with diverse backgrounds in technology, design, finance and public policy to build a modern mortgage bank from the ground up,” the firm says in its launch announcement. “We’re reimagining how lending can and should work, simplifying the origination process, lowering borrowing costs, and making the U.S. mortgage finance system more transparent and stable.”
Clara says it is going to take a “holistic approach” in reengineering the mortgage process.
“We’ve seen important early innovations in consumer finance – but they haven’t gone far enough,” the company says in its release. “While new lenders have transformed personal loans and student loan refinancing, core sectors of consumer lending remain largely the same. For most middle-class borrowers, little has changed.
“This is especially true in the $10 trillion mortgage market, where government-subsidized financing is abundantly available,” the release states. “We don’t need new sources of capital – we need a better way to access it. Amazon changed the way consumer goods are delivered by reengineering the entire retail supply chain; we can do the same for mortgage finance.”