Domuso, a property management system and payment portal that lets tenants in sticky situations pay late rent over time, has raised $3.1M in funding.
This brings the total amount raised for the startup, which was part of the TechCrunch Disrupt NY 2017 Battlefield competition, to $5.8M.
The concept for Domuso is straightforward – there are certain life events that sometimes get in the way of paying rent – like losing your job or getting an unexpected big medical bill. When this happens, tenants using the platform can request an installment loan to spread this missed month out over 6 or 12 months, instead of getting hit with huge late fees. Approvals take less than 30 seconds, and the property manager receives the money just like they would from a regular rent payment.
While these loans are more expensive for consumers then a traditional bank loan, their rates are “competitive when compared to credit card rates”. They also don’t require a hard credit pull until after the loan is confirmed – instead, Domuso sticks to a soft credit check before the make a decision, relying mainly on data they already have on the tenant, like past payment history.
And when tenants don’t need help paying their rent, Domuso is still their main payment portal each month – meaning the startup generates revenue from all tenants even if they don’t use the loan product.
There are currently 30,000 units on the system, including 7,000 units owned by Gelt, which is a real estate investment company run by the founders of Domuso. Since users can only use the pay-over-time feature if their property manager has signed up for Domuso, the startup’s focus right now is on-boarding new property management companies.
While Domuso didn’t disclose what percentage of the 30,000 units were currently using flexible payment plans, when the startup launched they said about 4,000 out of 20,000 were using the feature. If this ratio scales, Domuso could end up substantially changing the way many people handle late rent situations – considering the startup says that right now in the real estate industry only 1 to 2 percent of all rent is paid on credit.
Domuso plans to use this new funding to integrate with additional rental payment providers, as well as develop their data and risk management algorithms.