Backflip, a fintech platform focused on supporting real estate investors, has announced the acquisition of $184 million in capital to finance residential transition loans (RTL), often referred to as fix-and-flip mortgages. The total funding includes $30 million in private credit funds and $154 million in asset-backed financing.
Despite challenges in the housing market, Backflip has managed to increase its loan origination volume threefold over the past year, achieving a $375 million run rate. The platform is widely used, with its members analyzing an average of $10 billion worth of real estate opportunities each month.
Backflip’s platform offers investors access to financial tools and resources, helping them manage investment portfolios and secure funding for property projects. The additional capital is intended to expand the availability of its loan products to a growing customer base.
The funding is composed of several key components, including a $20 million joint venture with ECMC, a $10 million private credit fund managed by Backflip, a $100 million warehouse line arranged by Performance Trust, and a $54 million credit facility provided by Setpoint.
The demand for RTL loans is increasing among institutional investors, who see the sector as offering favorable risk-adjusted returns. Morningstar’s investment-grade ratings on RTL securitizations have attracted significant interest, with $4 billion in RTL securitizations completed in the first half of 2024—a notable increase compared to the same period in 2023.
“This funding allows us to continue refining our financial products to better serve our members, many of whom are focused on restoring aging properties. We appreciate the trust from our capital partners as we expand our role in this institutionalizing asset class,” said Backflip Co-Founder and COO Jake Rome.
Setpoint Co-Founder and CIO Michael Lam noted, “We are pleased to strengthen our partnership with Backflip. There is an evident market demand to support local real estate investors with effective financial and technological tools. We look forward to contributing to this effort.”
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By Proptechbuzz
By Ravi Kumar
