Remax purchases mortgage fintech Wemlo, adding processing services
Remax Holdings, which owns mortgage brokerage franchisor Motto Mortgage, has purchased nascent fintech company Wemlo, which provides loan processing technology.
The terms of the deal were not disclosed, although in an investor presentation filed with the Securities and Exchange Commission, Remax said the compensation consisted of cash and stock.
Wemlo is a 20-month-old company based in the Fort Lauderdale, Fla., area with approximately 30 employees. It has developed a "service cloud" for mortgage brokers, which combines third-party loan processing with an all-in-one digital platform.
"The acquisition of Wemlo … helps address one of the mortgage brokerage channel's biggest pain points — ineffective mortgage loan processing," Adam Contos, Remax Holdings' CEO, said in a press release. "This tuck-in acquisition also diversifies our revenue and growth opportunities, reinforcing our M&A strategy of adding innovative companies that deliver value and improve the customer experience."
Ward Morrison, the president of Motto Franchising, will lead Wemlo alongside its co-founders David Rogove and Steven Gelley.
"The acquisition will create more competitive advantages for Motto Mortgage franchises," said Morrison. "Moreover, due to the demand for quality processing support in the mortgage broker channel, Wemlo will keep serving its clients and continue to market its end-to-end solution throughout the mortgage brokerage industry."
Wemlo generates revenue by charging mortgage brokers fees for processing loans on a per-file basis.
"The platform has automated tasks and an intuitive framework, enabling loan processors of any experience level to manage the workflow and provide a high level of service to the loan originators they support," Gelley said.
Motto recently sold its 200th franchise since the company's inception in October 2016. In the 12-month period ended June 30, it sold 60 units. There are now over 125 Motto Mortgage units in operation, which are independently owned and licensed.
While initially marketed to Remax real estate brokerage franchisees, Motto units are now offered tofranchisees of other real estate firmsas well as independent operators and mortgage brokers.
"Adding the product line of this like-minded startup innovator adds firepower to the Motto Mortgage value proposition and unlocks tremendous overall growth potential for Remax Holdings in the mortgage broker channel," Contos said.