FirstClose Secures $35 Million in Equity Funding
May 19, 2022
Texas-based fintech FirstClose raised $35 million in equity funding from Lateral Investment Management.
The company intends to use the funds to expand its financial services presence to leverage property data intelligence, partners and technology to enable lenders to compete for and close consumer loans.
FirstClose provides underwriting workflow automation technology, point-of-sale software and data services for the U.S. home equity and mortgage markets to reduce the time to close HELOCs and mortgages for more than 400 banks and credit union customers. The company has strategic partnerships with MeridianLink and other LOS companies to embed its workflow automation and data solutions into their platforms.
“FirstClose is excited to announce this next step in our company’s journey,” said Tedd Smith, co-founder and CEO of FirstClose. “Our mission has always been to improve the way that banks and credit unions serve consumers by accelerating loan closing times, increasing loan volumes, and reducing costs.”
Smith added that, “This year, as interest rates continue to rise and home equity lending volumes skyrocket, this funding will allow us to continue innovating faster and provide a superior customer experience, while delivering end-to-end solutions that are in high demand in today's constantly changing lending environment.”
Soaring home prices have made home equity lending products a clear option for lenders looking to diversify their portfolios while creating new revenue streams. The increase in mortgage rates since the beginning of the year has caused the additional demand for home equity lines of credit (HELOCs) and other home equity lending products to increase significantly. The company said the new funding for FirstClose is the first institutional equity investment round in the company, which has been self-funded since it was founded in 2000.
“Lateral is excited to partner with the FirstClose team as they accelerate growth,” said Stuart Barden, managing director at Lateral Investment Management, a San Mateo, Calif.-based growth equity investment firm. “We believe that FirstClose has a critical role to play in streamlining the origination, underwriting and closing processes in the $200 billion consumer home loan market.”
The company said lenders using the FirstClose EquityIQ solution have experienced a 35% increase in online applications, a 25% increase in pull through, and a 77% reduction in time to close from application to funding.
FirstClose also recently named Pat Carney as chief technology officer and Kathy Mantych as the senior vice president of sales. Carney has more than 20 years of experience and has previously served as the chief innovation officer and senior vice president of strategic partnerships at ClosingCorp.
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