Tomo, an AI-powered digital mortgage lender, has secured $20 million in a Series B funding round to accelerate its expansion and technological advancements.
The investment was led by Progressive Insurance, with participation from existing investors Ribbit Capital, NFX, and DST Global Partners. This latest round brings Tomo’s total funding to $130 million.
Founded by former Zillow executives, Tomo is dedicated to transforming the mortgage process by lowering interest rates and eliminating hidden fees. Its AI-driven platform enhances underwriting and sales, enabling homebuyers to secure loans more efficiently and cost-effectively. The company’s technology delivers an average mortgage rate reduction of 0.50%, potentially saving buyers approximately $4,000 at closing.
The newly raised capital will fuel Tomo’s nationwide expansion, with plans to hire additional loan officers and mortgage professionals in key locations such as Detroit, Seattle, and New York. Additionally, the company is preparing to relocate its headquarters from Stamford, Connecticut, to New York City to support its growing operations.
Despite industry-wide challenges in 2024, Tomo has experienced significant growth, expanding its operations to 31 states, including Washington, D.C. By December 2024, its purchase unit volume ranked in the top 10% of mortgage lenders nationwide.
“We use AI to provide low rates without hidden fees or missed closing dates. There’s no ‘rate-keeping’—homebuyers get upfront pricing without needing to speak to a salesperson first. Customers appreciate our honest approach and seamless experience. We’re thrilled that our investors recognize our unique vision and value.”
NFX general partner Pete Flint praised Tomo’s technology-driven strategy: “While many mortgage lenders claim to use automation, their processes often rely on call centers or outsourcing. Tomo stands apart by leveraging proprietary technology to eliminate origination fees and processing delays, a game-changing approach in the industry. We are excited to support Tomo as they enter this next phase of growth.”
