Irvine-based Cloudvirga Inc., a fast-growing mortgage software company, is expanding its retail lender platform to wholesale lenders and their brokers, and has signed up Citizens Bank based in Rhode Island for the service.
Wholesale lenders are banks or institutions that don’t deal directly with consumers, but offer their loans through third parties such as mortgage brokers.
Cloudvirga aims to service the increased market share of the wholesale operations sector.
Kyle Kamrooz, a co-founder of Cloudvirga, declined to provide the amount involved in the Citizens Bank deal for the wholesale side, but said “it’s a big deal, because now we’re in a top-tier bank.”
Citizens Financial Group Inc. (NYSE: CFG), based in Providence, R.I., operates bank branches and provides banking services under the Citizens Bank brand name. The company had a market cap of about $11.4 billion as of the middle of last week.
$200B Annually
Cloudvirga helped digital mortgages go mainstream in the retail channel over the past four years.
The company’s technology allows lenders automate workflows, cut costs, increase transparency, and reduce closing times, and powers nearly $200 billion in loans annually.
The move into wholesale accelerates Cloudvirga’s goal to be a one-stop shop for lenders who operate in multiple channels.
Over the last four years, lenders’ wholesale operations serving mortgage brokers have grown market share to almost 16% of the $2 trillion in annual mortgage volume, the company said.
Kamrooz said the market share for wholesale will increase in the coming years.
“We are seeing massive demand from wholesale lenders who want to give their brokers a robust TPO (third-party originator) portal, as well as a smarter mortgage from application to close,” said Cloudvirga co-founder Mark Attaway.
Cloudvirga has reported raising more than $77 million from investors since its 2016 founding.
Additional funding helped the new push into wholesale, according to Kamrooz.
“We got additional capital from our current investors to be able to now expand the product, because it’s successful on the retail side, to lenders who also service mortgage brokers on the wholesale side,” Kamrooz said. “So, we’ve become now omnichannel.”
Finance of America Mortgage, which already uses Cloudvirga to power the mortgage process for its 1,500-person national retail salesforce, will now use the software to power their large wholesale network that serves mortgage brokers.
More Choice
“Having a mortgage broker who can shop for multiple lenders versus going to just one lender, that’s the benefit of being a mortgage broker,” Kamrooz said. “A mortgage broker wholesale allows consumers to go to a broker and they’ll have the broker shop among many lenders, versus on the retail side you go into one lender.”
Kamrooz said the biggest advantage for the consumer is “more choice.”
