Fairway Home Mortgage is partnering with Made Card to offer a credit card which will provide points for making their normal monthly loan payments and for purchases of home products and services.
Borrowers do not need to use the Made for Home Card, formally the Made Essential Visa Signature Preferred Card, for making their on-time mortgage payment in order to receive an award.
But purchases for home improvements, home maintenance, home furnishings, gas, groceries and utilities all must be done by using the card to be eligible.
This card does not have a fee. Reward points can be redeemed as cash back or gift cards, as well as buy downs of the credit card annual percentage rate.
“By offering rewards tied to on-time mortgage payments and home expenses, we’ll provide our customers with the benefit of reducing costs on future refinance or purchase mortgages,” said Mike Blake, president, capital markets, at Fairway, in a press release.
Made Card’s seed round funding
Made Card has just completed an $8 million seed funding round with investors including Jump Capital, Village Global, Recharge Capital and Soma Capital as well as individuals with credit card and mortgage industry experience, including from Fairway.
National Mortgage News spoke with the three co-founders of Made Card: Ashin Shah, the CEO; Christophe Van; president; and Alex Shin, who is a board member. All three have financial experience, with Shah having spent time at Bain Capital, where he was an analyst; Van at J.P. Morgan and YieldStreet; and Shin with experience as a mortgage-backed securities trader and then as vice president of finance and capital markets at Ramp on the credit card side.
The Made Essential Visa Signature Preferred Card is its first offering, but plans are to launch additional products in the coming quarters, Shah said.
While Made Card has the risk as well as the unit economic benefits, the card itself is issued by Lead Bank, a Kansas City, Missouri-based institution, Shin said.
With mortgage rates back in the 6%-to-7% range and expected to remain at that level, “homeownership has become a lot harder to attain for a lot of folks,” Shin explained. “And I think there’s definitely the impetus for [people] just to think about what are interesting, innovative, creative ways to make home ownership more affordable.”
At the same time, origination volumes since their peak during the pandemic have shrunk. An age old issue is how mortgage lenders can differentiate themselves from the competition, Shin continued.
The founders also come from “hardcore technical backgrounds,” Van noted, and combined with their fintech experience, “it was just the perfect opportunity, perfect storm, to bring in a lot of these aspects in a really high level way into the mortgage industry and unify it with other components that we really believe can take it to the next level.”
Another factor was the shift in origination share away from depositories towards nonbank lenders, Shah added. Made Card is looking to create an ecosystem much the same as American Express has around travel and dining.
“That’s where we saw the opportunity here is to kind of bring that to the mortgage and homeowner landscape, and to be able to build an ecosystem for home spend in the same way that ones exist for other categories of spend,” said Shah.
Looking at all of those together, the three decided the answer was to create a credit card with a loyalty program.
Other loyalty programs at mortgage lenders
Others have looked to loyalty programs to boost business and as a form of customer retention.
Rocket Rewards was brought to market in November 2022 aimed at potential homebuyers. In 2024, its own branded Visa card was offered. But both programs have been discontinued.
Earlier this year, RocketRentRewards was started. Homebuyers can earn 10% back on their last 12 months of rental payment to use as lender credits towards closing costs.
Also in 2024, Mesa began offering a homeowner focused credit card. Paramount Residential Mortgage Group co-branded with Mesa in May.
A more recent partnership is between Bilt Rewards and United Wholesale Mortgage. The combination will deliver “a tremendous amount of exclusive benefits for our brokers, including 4-to-500,000 leads [of] Bilt renters that convert to purchase every single year exclusively to our mortgage brokers,” UWM Chairman, CEO and President Mat Ishbia said on the third quarter earnings call.
Later in the call Ishbia said in the past when these consumers buy a house they leave Bilt.
“Now they’re going to have a way to make a mortgage payment through Bilt by working with a mortgage broker,” he continued.
Why Fairway became interested in Made Card
For Made Card, “our perspective is it’s all about execution, product and prioritization,” Van said.
Fairway is Made Card’s first nationwide mortgage partner, and it expects to announce a number of additional lender and servicer partnerships as the business scales, Shah said. It plans to partner with homeownership adjacent businesses outside of the mortgage industry as well.
The company approached Fairway, who Shin has connections with from his past experience. Even so, he added that as an early stage startup, it had to spend a little bit of time to curate some of these relationships and get introductions.
Fairway, along with some of its executives are also investors in Made Card.
“It was really a shared vision where the mortgage industry broadly is focusing on how to retain their customers, preparing for the next wave of refi,” Shah said. “We’ve been very pleased that Fairway is very forward thinking in innovating on this.”
Since the card does not need to be used to make the payment, Made Card is able to get the information through a series of integrations with Fairway and other partners, including credit reporting agencies and banks, so no change is needed by the consumer, Shah said, adding “we’re able to create it seamlessly on our end, through technology.”
Will the swipe fee settlement affect the Made Card
A recent development in the credit card industry is a proposed settlement of a swipe fee lawsuit with MasterCard and Visa. If approved as currently agreed to, merchants have the right to not accept certain classes of credit cards (right now, if they take a Visa card, for example, they must accept all Visa cards).
The tiers include one for fee-based rewards cards.
However, the Made Card is designed to be a mass market card, whose acceptance is guaranteed under the settlement agreement, rather than a premium card, Shah said.
