If Kelly Pantis gets her way, buying a house will be transformed from a 30-day ordeal to a three-day cakewalk.
Kelly Pantis wants to transform the home-buying process. Her vision involves streamlining the entire closing process via custom software and the Internet. That would allow the coordination of real estate agents, lenders, closing officers, title companies, appraisers and even pest-control agencies all online.
Her vision is compelling enough to persuade a number of Sacramento, Ca. investors to pony up $2 million in initial funding for her company, Realty Plus Online. Pantis hopes a round of venture capital will bring in another $10 million by the end of summer.
"The real estate industry is eager to embrace any technology that can help them speed up the laborious process of a real estate transaction," Pantis said. "We think this is the killer application for the real estate industry."
Pantis is convinced an online system for coordinating real estate transactions can not only save on such things as courier fees, faxing costs and frantic phone calls, but will also speed deals to the point where closing workers can handle 25 to 50 percent more work.
To that end, her company and its 37 employees have spent the past year building a complex piece of software called CloseYourDeal, which is designed to automate the home-buying experience from the time the agent draws up the sales agreement to when the buyer is handed the key.
Realty Plus isn't alone in the market. At least one competitor, iProperty of Bloomington, In. is developing a similar product. But with 5.1 million residential real estate deals closing every year, there's likely room for several players in the market.
One of the biggest benefits of such a system, real estate professionals say, would be to cut back on the telephone tag that's so common when checking on the progress of the home financing process. Instead, the players in the deal would be able to use their Internet browsers to see the status of any deal in the works, such as when an appraisal is scheduled, if the title search is complete and whether the lender has run a credit check.
"I estimate that a system like this would provide at least a 20 percent time savings," said Jeff Compton, president of Comstock Mortgage in Sacramento, which has agreed to be a tester for the software.
The ability to reduce paperwork also promises to be a big plus. The software is designed to automatically import information from one type of document to another, so relevant information from a sales contract, for example, will automatically be moved into credit reports or loan applications.
Chuck Klein, a Realtor with Lyon & Associates in Sacramento, said his preview of CloseYourDeal leads him to believe that it could be a big hit with other real estate agents.
"You could be in Timbuktu and still be communicating with the title company over the Web," Klein said. "If you want to see if something's been done, it's right there on your desktop."
CloseYourDeal will generate revenue by charging title companies, lenders and appraisers a fee for each transaction that closes. Smaller participants like appraisers would pay a $10 fee, while larger ones like lenders and title companies would pay something less than $100 per transaction.
Real estate agents and buyers and sellers will not pay a fee to use the service. Pantis thinks that the cost savings from eliminating courier or overnight services to rush documents from one place to the next will more than offset any fees CloseYourDeal will charge. And the elimination of phone hassles and paperwork will make it even more attractive, she said.
If the various players adopt the system at the rate Pantis is projecting, she sees revenue of more than $30 million a year by the end of 2001.
"It's a wonderful concept," said Richard Bristow, an associate Realtor with Coldwell Banker. "But everyone has to use it or it's not going to work."
The service will be available for use in the seven-county Sacramento area, and in five metropolitan areas nationwide by the summer. The company hopes to have clients using the system in 20 metro areas around the country by the end of the year.
