Avalanche home loan tokenization protocol raises $10M in Series A

The homeland equity line of credit (HELOC) tokenization platform Homium, which operates on the Avalanche network, successfully secured $10 million in its Series A financing. This round was spearheaded by Sorenson Impact Group and Blizzard.

“Avalanche reveals that through Home Equity Shared Appreciation Loans offered by Homium, homeowners are provided an opportunity to secure a loan without enhancing their existing monthly debt commitments.”)

Through Homium, homeowners can set aside a part of their home’s future value as security for loans used towards maintenance, repairs, debt consolidation, or inheritance. Simultaneously, investors obtain a digital representation of this value tied to a collection of jointly owned properties on the platform.

Avalanche home loan tokenization protocol raises $10M in Series A

“Tommy Mercein, Homium’s CEO, stated that his company is creating a unique investment opportunity for institutional investors by introducing an asset class with low correlation to inflation and the potential for stable returns within their primary portfolios. The initial home tokenization loans are now accessible in Colorado, the United States,”.

Tokenized assets derive security from second mortgages given to individual homeowners for their single-family residences. The holders of HELOC tokens are ensured title-level protection, just like traditional mortgage investors. Homium guarantees that each property undergoes valuation by a third-party, hybrid appraisal service in collaboration with nationwide lenders.

HELOC tokens, which utilize distributed ledger technology, do not equate to cryptocurrencies. Instead, these tokens function as debt securities that adhere to the SEC’s Rule 144A for exclusive private placements among institutional investors in the United States. In terms of technology, Homium clarified:

“Patented technology gives Homium investors a real time window into every loan in each pool including its origination value and current marked-to-market estimated value. Because Homium loans are underwritten to a uniform standard that secures a % of the underlying home equity, this allows instant securitization of the note from inception. Investors receive pooled exposure to home price appreciation by state.”

Starting from July 2023, Avalanche has committed $50 million towards investing in on-chain protocols for tokenizing assets. Particularly, they are prioritizing those dealing with real estate and digital collectibles. Simultaneously, Citi, a leading financial services company, identified tokenization as the upcoming significant application in the crypto sector.

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2024-04-16 19:11