Breaking the mold: new mortgage products emerge

August 7, 2025 6:00 AM

In an interview with National Mortgage News, former Federal Home Loan Bank of Chicago executive Steve Thomas complained about the current lack of product development in the mortgage business.

That is likely because of a reluctance among lenders to create those unique programs outside of the agency and government spectrums especially since Monday morning quarterbacks on the financial crisis blame private offerings for causing the problem.

Thomas is not seeing any innovation even as non-agency mortgages are a growing segment of the marketplace.

But some industry players have made new product announcements or otherwise have programs which are outside of the box when it comes to home lending.

The following is a roundup of some recent news from those looking to help lenders and consumers in different ways.

Cenlar enters warehouse lending, conduit

Cenlar FSB, a depository whose primary business is mortgage subservicing, has started offering warehouse lines of credit, as well as providing a secondary market outlet for lenders through a conduit.

Having the banking charter is important because "it's a complimentary product line that, quite candidly, none of the other subservicers could do or offer," noted JB Long, chief banking and capital markets officer.

Cenlar provides financing and debt alternatives as well as traditional warehouse for independent mortgage bankers, including mortgage servicing rights financing.

"Having the loans on our platform affords us to cross-collateralize in a way that we can be unique in how we're positioned to help our clients," Long said.

For Cenlar, it is a way to enhance the relationship with their clients "and hopefully provide a service and a level of economics they just can't get elsewhere," he continued.

The conduit already has a pricing matrix in place, and the company is onboarding clients while also providing a liquidity outlet through bulk loan purchases.

"I think what's attractive to the clients is usually, in these situations, they're forced to sell the servicing to the best [execution] model, to the investors who are buying this today," Long said.

"By selling to us, we can continue the white label service and they can preserve the customer."

The conduit will not be buying agency mortgages. It is starting with home equity lines of credit, Long said, and will evolve into buying other nonagency loans such as closed-end seconds and jumbo bank portfolio adjustable-rate mortgages.

"Over time, we're bringing some investor partners to the table who are also subservicing clients…to offer a whole spectrum of products, solutions that our clients can sell into," Long said.

Bridge lender gets warehouse line

Upequity, an Austin, Texas-based company which allows for homeowners to purchase a new house prior to selling their current one, has received a warehouse line from Silicon Valley Bank and Setpoint Capital.

The facility will provide up to $200 million in financing capacity for Upequity. It is expected to support $1 billion in originations over the next two years.

"The strong demand for our product reflects how well it meets our partners' and customers' needs," said Upequity CEO Timothy Herman in a press release. "This new facility will allow us to help more customers with a smoother transition from their old home to the next."

Upequity plans to grow by expanding its strategic partnerships with mortgage lenders, real estate brokers and homebuilders.

While the relationship with Silicon Valley Bank, a division of First Citizens Bank is recent, the company has been working with Setpoint for about two years.

"Upequity gives homeowners a fast, streamlined path to their next home — unlocking equity and eliminating friction in the process," said Kendall Ranjbaran, managing director of investments at Setpoint Capital. "We've been proud to support Upequity with tailored financing solutions since 2023 and are excited to deepen our partnership as they enter this next chapter of growth."

Builder teams with crypto-to-real estate platform

Pearl Homes, the developer of the Hunters Point community in Cortez, Florida, has created a strategic alliance with RealOpen.

RealOpen supports the purchase of homes using various forms of cryptocurrency, including Bitcoin and Ethereum, along with stablecoins like USDC and USDT. This partnership comes at a time when Federal Housing Finance Agency Director Bill Pulte is encouraging the secondary market to accept crypto assets.

The cryptocurrency is converted into U.S. dollars.

"We believe that the future of real estate involves both sustainability and innovation," said Marshall Gobuty, founder and CEO of Pearl Homes. "Aligning with RealOpen is a natural next step for us as they're the first to make crypto a viable payment option in luxury real estate, and Hunters Point is the perfect fit for that level of innovation."

Homes in Hunters Point are elevated 16 feet above sea level and built with concrete, timber and steel components to exceed the state's hurricane codes. They are powered by solar panels.

"Pearl Homes has redefined what sustainable living means," said Johnny Schiro, senior vice president of RealOpen. "By integrating RealOpen's crypto-to-cash platform, they're opening the door for a new class of forward-thinking homeowners who are looking to align their investments with their values, whether that's in green technology, digital currency, or both."

Providing current owner financing to help relocators

In 2017, Tennessee Homes launched programs to provide current owner financing, as well as seller leaseback as part of the company's focus on the relocation business to its home market in the Tullahoma area. Among the businesses in that region of the state is Jack Daniels, Ernie Hobbs, founder and CEO, noted.

These employees and executives were being transferred, but couldn't buy a house immediately because they're waiting for their house from wherever they're moving from to sell.

"So we started buying the houses in our local area, doing all the fix up work," Hobbs said. "We would basically have an inventory list these employees and executives could choose from, and then they would set up whatever contract they would want with us."

Tennessee Homes' business model developed itself as it started seeing what the needs were of the employees and executives coming into the area and it worked to customize this to what best fit their needs, Hobbs continued.

"This program that we do, allows them to go ahead and get into a nicer home, start getting acclimated to the area, but not have to worry about two mortgages," he said.

Real estate investor Marko Rubel is Hobbs' mentor and taught him this business model.

The rent-to-own program, in particular, works well for a lot of people. It doesn't impact their credit or debt-to-income ratio, but once they sell their old house, they are now able to purchase the other property, he said.

Because it owns the properties, Tennessee Homes does not need to be licensed as a mortgage lender.

"The neat thing about our business, is we can customize our financing based upon the person's situation," Hobbs declared. "We're not cookie cutter where it has to be inside this box and if it doesn't fit in that box, sorry, we can't help."

iBuyer Opendoor adds Cash Plus to help sellers

Opendoor's new product, Cash Plus, is described by the company as giving home sellers the speed of transaction as with its Cash Offer, combined with the ability to market the property with a "trusted agent partner."

Using the product involves four steps:
· The homeowner sells the property to Opendoor
· Opendoor brings the home up to where it is ready for listing
· The property is sold on the open market, working with local agents
· The homeowner has the potential for additional proceeds beyond the cash paid when Opendoor bought the property.

"Cash Plus provides sellers the certainty of our Cash Offer and the opportunity to gain more by using a market listing," said Opendoor Head of Agent Partnerships Nick Boniakowski, in a press release.

"Now, our local agent partners can offer even more home selling solutions, and make optionality one of their differentiators for clients," he added.

This program is available in three markets: Dallas, Nashville, Tennessee and Raleigh, North Carolina, with plans to roll this out to wherever Opendoor does business.

Flyhomes completes capital raise to expand wholesale channel

Flyhomes, whose financing allows existing homeowners to buy their next property before they sell their current one, completed a Series D funding round of $15 million.

This funding is being used to support its wholesale origination platform. Besides the new equity investment, Flyhomes secured a $200 million warehouse facility, which it said would support more than $1 billion in annual originations.

"This is a natural evolution for our business," Flyhomes CEO Tushar Garg said in a press release. "Our Series D funding and the recent sale of our AI home search technology enable us to double down on this wholesale distribution strategy."

At the start of July, Flyhomes pivoted into wholesale lending after selling its consumer-facing home search portal to The Real Brokerage; the latter also made an equity investment and is offering Flyhomes products through its One Real Mortgage brokerage operation.

The press release said the round was funded by existing investors. Lead investors on past rounds include Andreessen Horowitz, Norwest Venture Partners, Battery Ventures, Fifth Wall, Shasta Ventures and Canvas Ventures, according to Crunchbase.