Guaranteed Rate is diversifying its offerings in a tougher mortgage market, introducing personal loans.
Customers can apply for the loans in 10 minutes and receive funds between $4,000 and $50,000 within hours, the Chicago-based lender announced this week. Transactions do not include origination, insufficient funds, or late fees and are available in 10 states. Borrowers can repay the loans over periods of one to five years and can earn an APR of 5.74% as of Tuesday’s announcement.
“Guaranteed Rate’s impressive fintech platform is designed to provide our clients with fast and frictionless financial products,” CEO Victor Ciardelli said in a press release. “And our new end-to-end digital personal loans are a fantastic example of that.”
The company is launching the product at a difficult time for the industry plagued by rising interest rates and a slowdown in the housing market. The Guaranteed Rate has already reacted to the fall in the market, losing its the entire wholesale channel of Stearns Lending in March. Owning Corp., the lender’s direct-to-consumer brand, also remove 189 positions this last spring.
The company appointed last month three new digital leaders to expand its non-mortgage offerings, including Anand Cavale, executive vice president and head of unsecured lending products who previously led consumer credit efforts at Citi and SoFi Technologies.
“We know customers need and want their money fast and they want the process to be simple and hassle-free,” Cavale said in a press release. “Our new personal loan product over-meets these needs.”
The company is the second largest non-bank lender by 2021 volume to offer personal loans, after Rocket Cos. who also offers the product. Financial service providers are divert attention from mortgages personal loans and fintechs splash around more and more in both areas.
San Francisco-based fintech SoFi, which offers home, student and personal loans, described diverging revenue streams from its first-quarter results, in which it recorded over $2 billion in personal loan volume versus $312.4 million in home loans.