DALLAS—First there were home equity loans, now consumers can leverage the equity in their automobiles. https://www.otto.xyz/
Otto, a fintech startup that aims to allow people to tap into their vehicle’s equity for access to credit, has raised $4.5 million in a seed round of funding, TechCrunch reported. Among Otto’s financial backers is Mark Cuban, along with several other venture capital firms.
The company is building a mobile platform that will essentially let people borrow against their vehicles at the same interest rate as standard credit cards.
But unlike other cards, Otto said it will not charge fees or overdraft charges, and will not require applicants to supply their FICO credit scores.
Users will be able to remotely verify and collateralize their cars through Otto’s mobile platform, which is set to launch in early 2022, TechCrunch reported.
‘“Predatory” title loan agreements absolutely Crush People"
According to TechCrunch, friends and former colleagues George Utkov, Jordan Miller and Daniel Ashy came up with the idea for the company after Utkov’s friend became the victim of a “predatory” title loan agreement.
“Millions of people every year take out what are called title loans — and it’s when you own your car outright, and basically go pledge the title of your car as collateral against the loan,” Miller told TechCrunch. “These loans are 30 days long. They are 500%+ APR, and they absolutely crush people.”
Otto, a fintech startup that aims to allow people to tap into their vehicle’s equity for access to credit, has raised $4.5 million in a seed round of funding, TechCrunch reported. Among Otto’s financial backers is Mark Cuban, along with several other venture capital firms.
The company is building a mobile platform that will essentially let people borrow against their vehicles at the same interest rate as standard credit cards.
But unlike other cards, Otto said it will not charge fees or overdraft charges, and will not require applicants to supply their FICO credit scores.
Users will be able to remotely verify and collateralize their cars through Otto’s mobile platform, which is set to launch in early 2022, TechCrunch reported.
‘“Predatory” title loan agreements absolutely Crush People"
According to TechCrunch, friends and former colleagues George Utkov, Jordan Miller and Daniel Ashy came up with the idea for the company after Utkov’s friend became the victim of a “predatory” title loan agreement.
“Millions of people every year take out what are called title loans — and it’s when you own your car outright, and basically go pledge the title of your car as collateral against the loan,” Miller told TechCrunch. “These loans are 30 days long. They are 500%+ APR, and they absolutely crush people.”
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