Habito said it was “taking aim at the £95bn mortgage broking market, one of the only pillars of the consumer finance sector yet to benefit from technological disruption”.
The startup uses technology to analyse every mortgage on the market across 100 lenders in seconds and promises to match customers to mortgages, via telephone or online, within 30 minutes.
Habito said it has been backed by the chief executives of Transferwise and Funding Circle. The seed funding round was led by Mosaic Ventures.
Habito said it is the world's first digital-only mortgage broker and “plans to revolutionalise a market that has failed to keep pace with the needs of 21st century consumers”.
The firm said that two-thirds of people currently seek advice from brokers on the mortgage market. But the average broker, it said, will look at fewer than 10 per cent of mortgages available and take two to three weeks to process an application.
Habito believes its technology can save consumers up to £29bn annually.
Daniel Hegarty, founder and chief executive of Habito, said: “Technology has transformed our lives beyond recognition, so it’s hard to believe applying for a mortgage today remains no different from the difficult and often protracted process of 10, 20 or even 30 years ago.
“It is an industry that has seen no meaningful innovation, yet technology can do so much to take the pain out of mortgages for consumers. It’s not right that millions of people are paying over the odds on the wrong mortgage.
“It’s time for technology to bring mortgages into the 21st century.”