To compete with online lenders like Quicken Loans and Rocket Mortgage, big banks are looking for help from a tech start-up to speed up the mortgage application process.
Wells Fargo and U.S. Bancorp have both signed contracts with Blend Labs to use their mortgage software to potentially shave five or six days off the six-week application period, according to The Wall Street Journal.
Blend Labs, a five-year-old San Francisco company, raised $100 million during its last funding round, boosting its valuation to $500 million. But instead of competing with big banks, the company has decided to work with them.
“Success in the [online] lending industry in the U.S. is likely to come from partnering with the incumbents to become services enablers for them, opposed to outright competing with them as independent pure play providers,” said analysts at Morgan Stanley, according to The Wall Street Journal.
Blend Labs software directly connects to information sources so that it can automatically fill out mortgage applications. For example, it connects to TurboTax to glean information from filed tax returns and pay stubs.