This funding comes less than a year after the company announced the close of its Series A round, and Brace says it has now attracted more than $30 million of total investment.
The company’s business has grown quickly amid the pandemic as many Americans have fallen behind on mortgage payments or requested forbearances from mortgage servicers.
“An enormous amount of value is locked inside legacy core systems, and in this past year the Covid-19 crisis has been a catalyst for speeding up innovation in servicing,” Brace Chief Executive Eric Rachmel said in a statement.
According to the company, several large mortgage servicers signed on as clients in 2020, and the new funding will allow the company to broaden the services it provides and expand its team of employees.
The latest round of funding was led by Canvas Ventures, with participation from prior investors Point72 Ventures and Crosslink Capital.
Point72 Partner Tripp Shriner said in a statement last year that the company “has the potential to revolutionize mortgage servicing, which is an industry that is primed for change.”
Rachmel, a former venture capital investor, said in November that Brace’s business is focused on streamlining the process by which mortgage servicers collect payments from borrowers and track the status of mortgages within their systems — something Rachmel said adds unnecessary costs when done through outdated systems.
Canvas General Partner Rebecca Lynn said the firm participated in Brace’s latest funding round after concluding that the company had the ability to “successfully navigate a highly complex and regulated environment while building trust with large, well-regarded mortgage servicers.”
Brace has capitalized on the economic uncertainty created by the pandemic as well as the needs of mortgage servicers to streamline and digitize the process of communicating with buyers in need of forbearance.
Since the Covid-19 outbreak began, Brace has touted its ability to manage the loss prevention process for borrowers and mortgage servicers alike.
The company’s platform includes separate portals for borrowers and servicers where applications can be submitted and documents can be uploaded and signed.
In May, the company announced that it had received a template from the Consumer Financial Protection Bureau for No-Action Letters covering its loss mitigation tool.
The company said this template would allow it to automate the process of renegotiating loans for borrowers struggling to make payments by giving lenders the ability to easily request and obtain necessary documentation.
“An end-to-end loss mitigation platform which facilitates efficient communication between borrowers and servicers is crucial in this environment,” Rachmel said last year.
