Pontte closes US$29 million to revamp real estate loans

Contxto – Real estate loan. Ugh, just looking at the term can raise fears of paying high-interest rates, getting duped by a credit institution, and signing away money for a long time. But fintech Pontte wants to change these perceptions.

And to do so, the Brazilian startup recently closed an investment for R$160 million (~US$29 million). The names of the round’s participants were not disclosed.

The São Paulo-based fintech specializes in procuring credit for people to buy real estate. So thus, a part of the funds will be used to serve up more mortgage loans. It will also develop its tech and strengthen its team.

Uncoincidentally, this investment comes at a time when interest rates in Brazil are at an all-time low.

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Pontte is building on better options

Pontte— meaning “bridge” in Portuguese—knows there’s a large gap that separates many borrowers from traditional credit institutions. General mistrust, small print, the use of more technical terminology… it can all lead property hunters to feel insecure about signing on that dotted line.

That’s where the startup wants to stand out. The fintech reassures users that it offers lower interest rates than most credit institutions while also skipping out on the “fine print” stunts most lenders pull.

Pontte also emphasizes the importance of payment flexibility and allows approved borrowers to choose the payday for making an installment.

It even lets them select what month of the year they want to skip completing a payment, which is perfect during January or February when most of us are all spent from the holidays.

Primetime for real estate?

The real estate market of Brazil has shown it’s robust enough to withstand Covid-19.

This is largely due to the fact that interest rates in the country have been very low. While the Central Bank is wary of reducing it further and spurring inflation, in terms of what it means for the real estate industry, it’s pretty good news.

This macroeconomic factor is reflected in consumer behavior.

A recent survey carried out by Grupo ZAP showed that interest in searching for properties has increased, when comparing people’s behavior at the start of the pandemic in April and March with June.

Low-interest rates coupled with fair pricing and viable lending solutions may send more business Pontte’s way. But there are no assurances.

Depending on which economist you ask, the Brazilian economy is expected to contract somewhere between 5 and 6 percent. And with recessions, real estate is oft-hard hit.

But hey, perhaps the Bolsonaro government will pull out another trick to keep the property market momentum.

Related articles: Tech and startups from Brazil!

-ML