Unmortgage Aims For Financial Inclusion In Housing Market

London startup Unmortgage has just closed a £10 million (just over $13 million USD) seed round as it prepares to launch its “part-own, part-rent” platform next year.

“Unmortgage enables everyone to live in the home they want to; that’s our mission,” said Unmortgage Co-founder and CEO Ray Rafiq-Omar, according to reports. “We do that by allowing people to buy as little as 5 percent of a home and rent the rest. So there’s no mortgage involved, hence the name Unmortgage.”

Investors in the seed round are FinTech venture capital firms Anthemis Exponential Ventures and Augmentum Fintech, which are betting on Unmortgage’s unique approach to helping first-time buyers secure their first home.

“The way we like to think about it is the security of home ownership with the flexibility of renting,” said Rafiq-Omar. “You find a home. If we like it, too, we’ll buy it together in partnership. You’ll own your bit and you’ll pay rent on our bit. Then, you have the option to buy more of your home [for] as little as a pound at any time.”

Unmortgage will revalue the property on a monthly basis, and customers are free to either buy out Unmortgage or give the company three months’ notice at any point for the company to buy the consumer. And though the amount paid on the rented portion of the property is attached to rises to inflation, if that rate outpaces market rate, the company will allow the customer to ask for a review.

“They have the ability to not have to worry about their rent  but if they are worried, they can have it reviewed,” Rafiq-Omar added.

Unmortgage will use institutional funding to finance its part of the homes it buys.

“We’re grateful to our investors for believing in us and our social mission, and [are] excited to be working with them especially Tee Pruitt [of Anthemis], who was instrumental through much of this process,” said Rafiq-Omar.


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