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Tomo Mortgage raises $20 million in Series B funding, backed by Progressive Insurance and other investors, to expand its AI-driven home loan services. The company lowers mortgage costs by eliminating hidden fees and offering interest rates up to 1% lower than major lenders. With rapid growth and operations in 31 states, it continues to scale while shifting its headquarters to New York City.
AI Meets Home Lending: Why Tomo Mortgage Stands Out
Tomo Mortgage applies artificial intelligence to home lending, reducing costs and streamlining the process. The company aims to eliminate hidden fees and inflated interest rates that add financial strain to homebuyers. Its approach offers upfront pricing without requiring borrowers to speak with a salesperson before receiving rate information.
By using AI, Tomo Mortgage accelerates underwriting and sales processes, reducing delays that often slow mortgage approvals. This efficiency not only cuts costs for borrowers but also enhances accuracy in determining loan eligibility. The company’s automated platform provides a faster, simpler alternative to traditional mortgage lenders, which often rely on call centers or outsourced processing.
$20 Million Boost: Who’s Investing in Tomo Mortgage?
Tomo Mortgage has secured $20 million in Series B funding, increasing its total investment to $130 million. Progressive Insurance leads the latest round, joining previous investors Ribbit Capital, NFX, and DST Global Partners.
Investors recognize Tomo Mortgage’s efforts to modernize home lending through automation and AI. The company’s data-driven approach has drawn interest from firms focused on financial technology and customer-centric solutions. This funding supports continued expansion and further development of its AI-powered platform.
Beating the Competition: How Tomo Mortgage Lowers Costs for Homebuyers
Tomo Mortgage reduces home loan expenses by offering rates that are, on average, 0.50% lower than industry standards. Some borrowers have seen reductions of up to 1% compared to larger mortgage providers. This pricing model translates to significant savings, with the typical homebuyer paying $4,000 less at closing.
By eliminating traditional origination fees and processing delays, the company streamlines mortgage approvals without unnecessary costs. Unlike lenders that rely on manual verification, Tomo Mortgage automates key steps, reducing the need for human intervention while maintaining accuracy.
The company’s emphasis on transparency and efficiency has resulted in strong customer reviews. It holds a 4.9-star rating on Bankrate and has been recognized as one of the best online mortgage lenders of 2025.
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Rapid Growth and Expansion: What’s Next for Tomo Mortgage?
Tomo Mortgage has achieved a 3.5x increase in business, even as the broader mortgage industry faces challenges. The company now operates in 31 states, including Washington, D.C., and continues to expand its market reach.
To support this growth, Tomo Mortgage is hiring loan officers and mortgage professionals in Detroit, Seattle, and New York. The company is also shifting its headquarters from Stamford, Connecticut, to New York City.
With demand rising, additional investments in technology and customer service are expected. The focus remains on scaling operations while maintaining the efficiency that has set Tomo Mortgage apart from competitors.
The Bigger Picture: How AI Reshapes the Mortgage Industry
The use of AI in home lending is transforming the way mortgages are processed. Traditional lenders often rely on manual underwriting, leading to delays and inconsistencies. By contrast, AI-driven platforms analyze borrower data more efficiently, reducing processing times and improving loan approval accuracy.
Tomo Mortgage’s model highlights a shift toward automation in financial services. As AI technology advances, more lenders may adopt similar strategies to improve pricing transparency and borrower experience. The mortgage industry’s reliance on outdated systems has created inefficiencies that AI has the potential to resolve.
Tomo Mortgage’s Next Chapter in AI-Powered Lending
The latest funding positions Tomo Mortgage for further expansion, allowing it to reach more homebuyers while refining its AI-driven platform. Investors backing the company see AI as a tool that improves both cost efficiency and customer experience.
With a growing presence in the home lending market, Tomo Mortgage continues to challenge conventional mortgage processes. By offering lower rates and removing unnecessary fees, the company provides an alternative to traditional lenders that often prioritize profits over borrower savings.
As home financing evolves, AI-driven solutions like those implemented by Tomo Mortgage are expected to play a larger role in shaping the future of mortgage lending.
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