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New York-based mortgage platform\u00a0Roam<\/strong>\u00a0has secured a $1.25 million seed round, allowing the company to officially launch its services on Wednesday. Roam focuses on a distinctive niche within the mortgage industry:\u00a0assumable mortgages<\/a>.\u00a0<\/p>\n Tech executive and investor\u00a0Keith Rabois\u00a0at venture capital firm\u00a0Founders Fund<\/strong>\u00a0led the capital injection. It also included\u00a0Opendoor<\/strong><\/a>\u00a0co-founder\u00a0Eric Wu,\u00a0Culdesac<\/strong>\u00a0CEO\u00a0Ryan Johnson\u00a0and\u00a0#ANGELS<\/strong>\u00a0founding partner Jana Messerschmidt.\u00a0<\/p>\n Following the investment, Wu and Rabius will join Roam’s board.\u00a0Tim Mayopoulos<\/a>, former CEO of\u00a0Fannie Mae<\/strong><\/a>,\u00a0<\/strong>who was named\u00a0CEO of\u00a0Silicon Valley Bank N.A.<\/strong>\u00a0in March, is also listed as a senior advisor.\u00a0<\/p>\n Assumable mortgages, the company’s primary bet, were relatively commonplace a few decades ago. It\u00a0allows\u00a0qualified buyers with a government loan to purchase a home by assuming responsibility for the sellers’ mortgage terms, including the current balance and interest rate.\u00a0<\/p>\n The fees are typically lower than with new loans, and no appraisal is needed. However, the buyer must submit to the application and underwriting process to qualify, just as they would in any new mortgage.\u00a0\u00a0<\/p>\n The product has appeal given that most homeowners with low\u00a0rates<\/a>\u00a0mortgages aren’t motivated to sell their homes in the current environment. Moreover, many buyers are waiting on the sidelines, paralyzed by\u00a0low housing inventory\u00a0and high rates.<\/p>\n “This wave of immobility has created a once-in-a-lifetime opportunity for Roam to bring a much-needed solution to consumers and the housing market,” Mayopoulos said in a statement. <\/p>\n Roam said it helps homebuyers secure home loans “as low as 2%” through the mortgage assumption process. The product is available in five states: Georgia, Arizona, Colorado, Texas, and Florida. <\/p>\n “Assumable mortgages are one of the most undervalued assets in America,” Raunaq Singh, founder and CEO of Roam, said in a statement. <\/p>\n Specifically, Roam said it helps homeowners with an assumable mortgage by providing personalized marketing material to attract potential buyers and better offers. The platform advertises sellers listing to qualified buyers. <\/p>\n On average, Roam buyers save up to 50% on monthly mortgage payments compared to buying a home with a traditional mortgage at today’s rates, the company claims. All government-backed loans are eligible for assumption by law, comprising about one-third of mortgages in the U.S. <\/p>\n In a paper published by the Urban Institute<\/a> <\/strong>in October, Ted Tozer, the former head of Ginnie Mae<\/a><\/strong>, argued<\/a> that government changes to assumable loans could benefit the market. So why is this program so rare? In short, because of strict rules and product limitations. <\/p>\n