Compass is getting into the digital mortgage origination business.
In a company-wide email following the announcement, Compass CEO Robert Reffkin said by expanding into the mortgage, title and escrow business, the firm is “nearly doubling our total addressable market.” Reffkin had hinted at the move in May during its first earnings call following the April IPO.
In the email, Reffkin added that the partnership moves closer to “our vision of a truly end-to-end platform — from the first exploratory search to the last e-signature of the closing.”
It enters an increasingly crowded field that includes Tomo, Blend, which streamlines mortgage applications; and Better.com, an online mortgage lender.
One of the largest nonbank residential lenders in the country, Guaranteed Rate said it funded more than $73 billion in total mortgages last year, and has originated over $60 billion in loans so far this year.
Guaranteed Rate CEO Victor Ciardelli said the partnership would help the firm quickly build up a “tech-focused mortgage company.”
OriginPoint will operate in all of Compass’ markets, which as of May, included 47. There were few details about the new business, but Guaranteed Rate’s digital mortgage platform will migrate into Compass’ platform, and will also be available to other brokerages. Compass did not immediately respond to a call for comment.
Compass’ share price, which has plummeted since it began publicly trading, jumped 26 cents in morning trading following today’s news to $13.84, before dropping back down to $13.40 as of noon Eastern.