John Elias, former Executive Vice President at Chicago based Guaranteed Rate, commented:
“It's exciting to finally have a trustworthy, compliant alternative mortgage option that can help put dislocated buyers into their dream homes like business owners and the self employed. It will be great for the housing industry in Illinois."
About 1 in 3 workers in the greater Chicago metro area are self-employed and parallel to that roughly 1 in 3 traditional purchase loan applications in Chicago get denied.
The people that Privlo is focused on funding include:
- Self-employed workers including 1099 workers, contractors, freelancers and seasonal workers. Privlo expects demand in areas like West Town and cities like Glen Ellyn and Naperville, which are experiencing a population boom, as well as tech startup magnet Champaign, often referred to as the hub of Silicon Prairie.
- Entrepreneurs including business owners and tech founders. Privlo aims to serve Illinois’ recent surge in tech workers and entrepreneurs.
- Millennials who may have limited credit histories, non-traditional career paths, or multiple streams of income. Privlo is better able to understand their finances and work with those who are ready to get into their first home.
- Professionals who earn uneven bonuses or large commissions.
- Foreign nationals with work visas who plan to remain in the country for years or eventually become citizens. Illinois, especially Chicago, has drawn a growing number of immigrants in the past decade where now nearly every 1 in every 6 residents is an immigrant.
Michael Slavin, CEO of Privlo, explained:
“When the recession hit and unemployment soared in the state, that midwestern work ethic kicked in and Illinoisans began starting businesses, turning to self employment and freelancing. No doubt it’s helped pave the path to economic recovery but it’s also left thousands of deserving borrowers out of homes. Most lenders don’t understand how to accurately evaluate those without a W2 or typical tax return, and that’s where we excel.”
The company is sticking to its schedule to expand into 90% of states by the end of the year. It is already operating in 11 states and plans to be active in 21 states by the end of the year.
Saro Vasudevan, Privlo’s Chief Credit & Product Officer, added:
“What separates us from traditional lenders is the proprietary technology we’ve developed. Using that powerful technology backend, we aim to lower the cost of mortgages over time for people who are unable to get government-backed loans.”
