Tomo Secures $20M in Funding to Revolutionize AI-Powered Mortgage Solutions
Tomo, an innovative digital mortgage lender utilizing AI-driven technology, has successfully raised $20 million in a recent Series B funding round. This investment marks a significant milestone as the company aims to enhance the mortgage process for homebuyers across the United States.
Funding Round Details
The latest funding round was spearheaded by Progressive Insurance, with participation from notable existing investors including Ribbit Capital, NFX, and DST Global Partners. With this latest round, Tomo’s total funding has now reached an impressive $130 million.
About Tomo’s Innovative Approach
Founded by former executives from Zillow, Tomo is on a mission to modernize the mortgage process. The company focuses on:
- Reducing interest rates.
- Eliminating hidden fees.
- Streamlining underwriting and sales processes.
Tomo’s AI-powered platform offers average mortgage rate reductions of 0.50%, potentially saving homebuyers around $4,000 at closing. This efficiency not only facilitates faster loan approvals but also makes the borrowing experience more affordable.
Expansion Plans and Company Growth
With the new funding, Tomo is set to expand its operations nationwide, which includes:
- Hiring additional loan officers and mortgage professionals.
- Opening new offices in key cities like Detroit, Seattle, and New York.
- Relocating its headquarters from Stamford, Connecticut to New York City.
Despite facing challenges in the mortgage industry in 2024, Tomo has seen remarkable growth, achieving a 3.5x increase in operations and currently serving 31 states, including Washington, D.C. Notably, its purchase unit volume ranked in the top 10% of mortgage lenders nationwide in December 2024.
Leadership Insights
CEO and co-founder Greg Schwartz expressed the company’s commitment to transforming the mortgage landscape: “Outdated business practices, excessive fees, and inflated interest rates cost U.S. homebuyers billions annually. Tomo is dedicated to changing that.”
He further emphasized the company’s user-friendly approach, stating, “We use AI to deliver low rates without the hidden fees. People appreciate our honest pricing and seamless customer experience.”
NFX general partner Pete Flint added, “Tomo is taking a radically different approach with proprietary technology that eliminates origination fees and processing delays, which we have yet to see in the industry.”
Conclusion
Tomo’s innovative approach to mortgage lending and its recent funding achievements position it as a significant player in the digital mortgage landscape. To learn more about the latest trends in digital mortgage solutions, check out our Mortgage Trends page.
