What is the world’s most innovative real estate financing laboratory cooking up next?
B2R Finance CEO Jason Hogg has been shaking things up at one of the most exciting lenders we’ve seen emerge in the new real estate landscape. This is the innovative mortgage lender that brought us new residential buy to rent financing, the industry’s first multi-borrower securitization and was established by funds managed by Blackstone Tactical Opportunities. Jason shares what new loan products and tools are being rolled out, and how investors can stay ahead of the curve.
The Wayne Gretzky of Mortgage Lending
“A good hockey player plays where the puck is. A great hockey player plays where the puck is going to be.” – Wayne Gretzky
Gretzky developed a formidable reputation on the ice, by staying ahead of the game. B2R Finance appears to not only wield the physique of a legendary hockey player, but is driving the game with its speed skates on, and hitting the puck into the future.
The firm has already been disrupting the mechanics of the industry, and paving the way with entrepreneurial lending products. But most don’t realize how much new technology and creative problem solving is set to reshape real estate investment.
We got a peek inside the brain of the finance giant, and the 411 on what’s next in an exclusive interview with CEO Jason Hogg…
Dwell Finance: The New Deal for Investors
B2R Finance just acquired Dwell Finance. The big move helps B2R dig deeper with an expanding local market presence and adds new investment loan products. Jason Hogg says the Dwell Finance acquisition is significant on three fronts:
1. New Loan Products for Investors
Jason says it “augments the suite of products for customers with fix and flip, and bridge to term lending programs.” This includes a single credit line that facilitates rehabbing and reselling houses, acquiring multiple vacant properties for conversion to rentals, and portfolio refinance loans for buy and hold investors.
2. Integrating the Industry
Not only does the Dwell move help connect the industry, but few realize that it adds to an expanding national footprint with physical regional offices to optimize service for borrowers. This facilitates “business relationships,” including face-to-face time, which Hogg says is “paramount” to the organization and developing new products.
3. New Technology Platform
Dwell provides a simplified front end portal online. This delivers on what the CEO describes as “faster, low friction lending.” It’s not just about beauty in web design either. Behind the curtain is a unified platform which enhances the lender–investor relationship. It even acts as a mobile dashboard for investors to interact and upload documents on the go, as well as monitoring their portfolio performance from anywhere in the world.
This helps further build the relationship by tapping big and small data to provide users better solutions. This isn’t your creepy Facebook stalking-style relationship. It is about getting to know where you want to go, where your portfolio is in relation to that, the DNA of your local market, and how to connect the dots with great financing.
The Big Idea
While some newer real estate investors were griping about access to inventory as we turned the corner into 2015, B2R Finance’s Dwell acquisition and investments in product development suggest bullishness on the US market’s future. We’ve already seen a significant spike in foreclosure activity and distressed properties being leaked onto the market in early 2015.
Jason Hogg told Realty411 that the firm sees a “huge growth opportunity, worth billions of dollars.” In fact, Hogg says the firm has seen demand for investment property loans nearly double as of May 2015.
B2R Finance’s CEO describes the opportunity as being “ideal for professionals like doctors, lawyers, dentists, and professors looking to achieve higher yields.” He points out the combination of yield and income from an appreciating asset as a far better option for these intelligent individual investors, in addition to professional investors and investment firms. He goes on to highlight how the newly upgraded B2R-Dwell tool chest automates management to make investing “radically easier.”
The Lending Lab
So where does B2R come up with these innovative products, and what’s next?
A peek inside the mortgage lender’s offices reveals that this company is nothing like the stuffy, dark bankers’ corner offices of the past. This is more like Airbnb and Uber meets mortgage lending. In addition to the Dwell Finance acquisition, Jason has headed up a three-pronged approach to driving entrepreneurship in mortgage lending in-house.
1. Active listening
2. The Idea Incubator
3. The Lending Lab
There are few, if any other firms where you’ll catch executives, including the CEO, active in the trenches alongside their frontline team members. Hogg says he loves listening in to the origination team in action in the Charlotte office, as well as sitting next to the due diligence staff clearing loans for funding. It is this connection to the daily mechanical challenges and client that will certainly help B2R retain an edge.
The Idea Incubator is where team members get to pose their own suggestions for improving operations and delivering better solutions. The Lending Lab is where Hogg has assembled a team of experts from a variety of other industries to pioneer new loan programs for investors.
It is here that dynamic “agile development” happens and new pilot programs are launched for live testing with clients.
The CEO says that one of the new game changing product tools coming out of this lab is harnessing the power of predicative analytics, and algorithmic approvals. By summer 2015, this is expected to be revealed in the form of ‘Instant Pre-Qualification’ using just seven fields of information.
The result is to be an even more efficient lending platform which provides low rates and speed in funding, requiring the least amount of data, while retaining sound credit decisions. Beyond the sunnier math of using single credit lines to flip or rehab and manage multiple properties, this creates a more turnkey financing solution so that investors can redirect their time to growing their portfolios versus managing them.
Scaling Your Portfolio with Less Friction
Both passive investors and real estate entrepreneurs will find loan solutions like these provide the framework needed to scale their portfolios while the market is ripest. Looking forward, it is finance relationships and the operational edge which will divide those with the best net returns and most time to enjoy their gains from the rest.
Whomever investors have been using for leverage until now, it is worth keeping an eye on what’s coming out of the B2R Finance Lending Lab. For more insight into the minds and intelligence being injected into this mortgage maverick’s DNA, check out B2RFinance.com and DwellFinance.com.
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