Making the home ownership dream a reality
Sponsored by Lower
Estelle and her husband James rented their home in the Sacramento Valley area of California for years. They never thought they would become homeowners, but when their landlord passed away and the chance to buy their house came up, it seemed like too good an opportunity to turn down.
As is often the case, the process wasn’t entirely straightforward. The landlord’s family wished to avoid involving estate agents, and when Covid-19 hit, lenders grew reluctant to loan money to first-time homebuyers. A historic tax transcript issue also led to unforeseen complications.
Then Estelle and James came across Lower. It was the only lender that was prepared to help them become first-time homebuyers and it helped the couple every step of the way, including navigating the requirements for a loan.
Months later, the couple owns their first home and have embarked on renovations to add their own personal touch to the place they have rented for a quarter of a century. “We are still in disbelief; even when we were signing the stack of papers we were questioning if we are really the owners now,” Estelle said. “But we are! We’ve always called this place home but now it’s officially 100 per cent ours.”
Buying a home can be challenging, particularly for first-time buyers — and especially so at the moment, with rising prices and a shortage of supply. According to the National Association of Realtors, home prices have risen by 30 per cent since 2019, while the number of homes for sale is at a record low. The average home is about $80,000 more expensive than it was pre-pandemic.
Trying to help people such as Estelle and James was the reason why Dan Snyder co-founded Lower in 2014. “We wanted to make it more accessible for consumers,” he says. “Instead of an intimidating and complex journey, where they’d have to go and talk to a big bank and maybe get turned down, we wanted to open up the whole process.”
The business provides a one-stop shop to enable access to anything to do with the home-buying process, ranging from savings accounts for people to build a deposit to finding an estate agent or buying insurance to protect their biggest asset. It incorporates several unique features, including the ability for people to take a lifestyle-based home readiness assessment, which can help to determine whether buying a home is the right move for people at that time.
“As a fintech lender, we do everything from the origination to the service,” says Snyder. “We think about it from the standpoint that, no matter where the customer is in their home-buying journey, we want to be able to help them along the way. We’re trying to break down walls. If you bank with us, you shouldn’t need to apply for a home loan or check if we can get a better insurance rate for you. We should just give you a better insurance rate.”
Lower has recently launched HomePass, enabling customers to offer cash and stand out in a highly competitive market. Buyers are able to win the offer, backed by a deposit, and then get their mortgage behind the scenes.
The mobile experience is a key piece of Lower’s offering. “People spend an average of five hours a day on their phones – which is more than they do for most things such as exercising, eating and sometimes even sleeping – so we felt like a mobile-first experience, whether it’s for banking with us or during the mortgage process, was important,” says Snyder. “We built it with a consumer-obsessed mindset, based on years of experience of having worked at banks and mortgage companies that weren’t changing with the times.” Around 40 per cent of Lower’s customers are first-time buyers, well above the national average percentage of total homebuyers.
The majority of customers come directly to Lower, but the business is also building relationships with estate agents, builders and financial brokers, which can be particularly useful if people are considering buying a house in an area they’re unfamiliar with. “That can help them land the home,” Snyder says. “Realtors are still very powerful conduits in the US housing market, so we’re a big supporter of our realtor network.”
Over the past eight years, Lower has grown from seven to 1,500 employees, but Snyder is keen to stress that its focus remains very much on home ownership. “We’re a mobile-first consumer finance platform,” he says. “We help people save, plan for and buy their house and then we’ve got an estate agent arm to keep it all together. We’re not trying to do commercial loans, and we don’t do stock trading. We’re going to stick on the same path of unlocking wealth through home ownership. We want to be the best at this.”
Estelle has a very simple message to anyone who thinks the dream of home ownership may be out of reach. “Don’t give up,” she says. “There may be a few hurdles here and there, but if you want to work with a firm that really cares about helping you achieve your goal of owning your own home, Lower is there to help you. We have already recommended it to others. In the future, if the need arises, we will reach out again. Lower can make it happen!”
Business Reporter Team
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