Jetty, a FinTech-Meets-Proptech start-up, presents Jetty Rent – Commercial Observer
Financial services company for the rental of housing Pier today announced the launch of Jetty Rent, a new product designed to give tenants the flexibility to pay their monthly rent. Jetty Rent was developed and brought to market with the support of a new $ 23 million equity financing round from investors that include Citi and Thrive in companies, according to a statement from Jetty.
After initially creating Jetty Deposit, a product that helps tenants replace an expensive security deposit with a low-cost monthly policy, the fintech-meets-proptech company has now turned to monthly rent payments, said Mike Rudoy, co-founder and CEO of Jetty.
“The next big problem we saw was that tenants were facing, fundamentally, a liquidity problem,” Rudoy said, “especially with people who might be in the gig economy, who could live. from paycheck to paycheck and could have unexpected bills coming up on top. “
Rudoy continued: “If they don’t [have the rent], they are usually affected by high late fees which can often escalate and lead to chronic delinquency, abandonment and deportation. This is the problem that we are trying to solve with Jetty Rent. We try to provide tenants with financial flexibility to pay their rent on a schedule that suits their lifestyle. “
Jetty Rent operates on a monthly subscription model for renters, starting at $ 15 per month, Rudoy said. “If you think about what typical late fees are, they could be as much as 8% of a person’s monthly rent. So $ 15 as a starting point is much lower than that, if you think the average rent in the country is $ 1,200. For that $ 15 per month, the tenant is now able to pay their rent for up to 24 days in the month to Jetty, while we pay the property manager 100% of the rent on the first of the month.
“So unlike a payday loan, where you have an extremely large amount [annual percentage rates], and the cost of this loan increases over time if you are late, our product does not charge interest charges for late payments. You can think of it as a fixed monthly subscription.
Jetty Rent is a monthly product, Rudoy said. “If the tenant does not pay us within those 24 days, we will not give them the option of using Jetty Rent for the following month, until they reimburse us or make us unscathed from that payment. As soon as this happens, they can revert to the program. And so, we think there is actually a level of financial discipline that is built into the design of the product. Unlike a credit card, where people can go into debt by putting their rent on their card month after month, this simultaneously provides flexibility, but also ensures that they pay off the product.
Jetty cited data from the National Council for Multifamily Housing (NMHC) who said that in the first six months of 2021, an average of 21% of renters did not pay their rent by the sixth of the month. month, a deadline that would typically trigger late fees from homeowners. The federal moratorium on evictions has restricted the imposition of late fees, but with the moratorium now partially lifted, many tenants will again face this financial challenge.
The other thing Jetty Rent is trying to do is help property managers improve their cash flow, Rudoy said. Property managers are able to receive 100% of the rent on the first of the month and improve their tenant experience. “They’re no longer going to chase tenants to receive rent payments. Now they are giving tenants the option to pay on their own schedule. At the end of the day, we are trying to solve a delinquency abandonment and eviction issue, which is a huge financial burden and a legal liability for property managers and owners. “
To launch Jetty Rent, the company has partnered with Cortland, a top 20 investment, development and property management company, and deployed the offer to residents on a portfolio of properties.
“At Cortland, we are focused on improving the resident experience, and the rent payment process is an integral part of that,” said Jonathan kirn, director of ancillary services at Cortland. “Jetty Rent makes life easier for our residents and relieves us of the burden of collecting rent – it’s a real win-win. “
“Integrated finance platforms like Jetty are quickly becoming one of the most influential technology trends in the world, a trend where the customer’s experience with things like online payments and loans comes first. everything ”said Emmalyn shaw, Managing Partner at Flourish Ventures. “We are delighted to support the Jetty team as they continue to develop their fintech platform and product offerings to help reach those who need help and flexibility to cover housing costs.”
Philip Russo can be contacted at [email protected].