It would be hard to not agree on a straightforward fact: having a home is a basic human need.
As people get together and look for a new, exciting life, they stand before the first, and perhaps the most challenging task: to build or buy a home.
That’s where the mortgages come into play.
Few people can afford to buy a house with their cash. It’s no wonder, then, they go to banks and take a loan. However, banks are somewhat monopolistic in their services. You have to play their game, and that’s it because you have no other options.
Can cryptocurrency change mortgages for the better?
There is no doubt it can.
But will it?
All in all, although banks and similar institutions have a monopoly in mortgages, people still would hesitate to try crypto-mortgages, even if those offered better deals. Simply out of fear. Big money comes into play, and a part of customers won’t be risking it in some ICO start-up.
On the other hand, if there are no new start-ups and fresh ideas, the cryptocurrencies will slowly die out. We need innovative technologies and projects.
And that’s Homelend in a nutshell.
What is wrong with regular mortgages?
Homelend argues that the process of a paper-based mortgage involves too many entirely unnecessary parts. Although we live in late 10’ of the twenty-first century, the process of mortgage didn’t improve for decades. For today standards, it’s insanely inefficient.
As you make a mortgage application today, you need to meet overhead costs no matter if you are a borrower or a lender.
What’s more, the requirements for a mortgage are outdated; many young people have no chance of having their home.
How Homelend aims to speed up and improve the mortgage process
As you can imagine, it will reduce the current cons of mortgage people face today.
First of all, Homelend wants to be a platform in which borrowers and lenders would meet. That means – a streamlined process of the transaction. As few intermediaries as possible.
Achieving that can be done by the distributed ledger technology (DLT) and with the use of smart contracts.
In the end, the process of taking a mortgage could be nearly automated.
Advantages of Homelend
Firstly, the Homelend mortgages will be much faster. Today, the process takes about 50 days. Thanks to the pre-defined business logic in smart contracts and the documentation being entirely digitalised, it will be about 20 days with Homelend. What’s more, the project cuts out all unnecessary processes.
Furthermore, the service will be transparent as well as user-friendly. What does it mean? The application for a loan will be straightforward. You can track your entry at any time. Finally, you have a contact to the mortgage lender.
DLT provides transparency, safety and immutability. It eliminates banks acting as intermediaries for transactions, so it reduces the cost for borrowers and lenders.
Finally, the paper-based processes aren’t as secure as it may seem. The regular mortgage industry has vulnerabilities that would be gone thanks to DLT and smart contracts unique features.
But Homelend needs money – HMD Token
And that’s where the HMD token comes into play. Its purpose is to fund the Homelend peer-to-peer lending platform. The function of it is to grant you access to the platform itself.
What’s interesting, you can convert all tokens to HMD, and the HMD to other tokens.
The token is based on Ethereum blockchain.
How trustworthy is Homelend?
There are some factors you need to consider when assessing the security of an ICO.
First of all, see their whitepaper.
In the case of Homelend, it’s 32 pages long document packed with text. Some ICOs try to boost their whitepapers by adding unnecessary design graphics that only take space. Thankfully it’s not the case here.
Longer whitepaper – safer ICO.
It isn’t irony, though, it’s right to some extent. The whitepapers should be all as detailed as possible. What’s more, they should be transparent, so creators need to clearly disclose the business plan, including all, even tiny, steps.
The whitepaper of Homelend consists of the following parts: Introduction, Blockchain and the Mortgage Industry, Homelend’s Mortgage Lending Platform, Business Model, Token Generation Event, Our Team and References.
We’ve also looked at the ICO features in other media, and all ICO-reviewing sites are indicating it’s a trustworthy start-up.
The crew behind the project is available at linkedin. You can see some of the creators have significant experience and are well-known in the industries they work in. Usually, such people treat their careers seriously and wouldn’t join a fraud project.
What do you think of Homelend? Would you give it a go? If you would like to read more, it’s best to check out their website. We see that there is still some way to complete the start-up, but it looks promising.