In early 2017 Daniel Jeffords was closing on his home in South Carolina. As he, the closing attorney and his real estate agent sat around the table making small talk, his Realtor, George Clements, asked him what issues he saw in the real estate buying process. Jeffords immediately mentioned his surprise at still having to drive a paper check around just to pay earnest money. Clements related a story of driving 45 miles to pick up a wet soggy check from one of his other home buyers.
“I really hated how much paperwork was involved in the real-estate closing process, specifically around checks, so my real estate agent and I went into business together and decided to start working on a solution,” says Jeffords, Earnnest CTO.
Jeffords, a technology industry veteran, and his agent, Clements, decided to do something about this antiquated process.
Earnnest was born.
Earnnest is a software platform that allows buyers to electronically transfer funds directly to an escrow holder’s account.
“We are a really unusual use case with a complex flow, which is why we ended up speaking with Dwolla,” says Jeffords.
Electronic Transfers Open More Doors
To make it possible to send earnest money electronically, Earnnest needed a payments provider that was easy to integrate with and made it just as simple for the user as a traditional payment method. While alternatives (like wire transfers through banks) exist, they can be costly, time consuming and it is extremely easy to get account or routing information wrong on both sides of the transfer.
Jeffords says he wanted to transfer money with Earnnest in a more transparent way, while being able to easily track and understand the process.
As he searched for the ideal payment solution to fit Earnnest, Jeffords researched and spoke with 10 different payment providers. But with such a unique use case, Jeffords says it was hard for most to understand what it is Earnnest does.
“Verifying a users’ identity and then transferring money in a way that is much more secure and transparent—like ACH—saves us, on average, 30 minutes to an hour of drive-time for each deal,” Jeffords says. “It gets rid of the liability of losing a check and, with the way we are setup using Dwolla’s IAV, the buyer never has to punch in their account and routing information.
“Dwolla helps us remove the opportunity for human error.”
Jeffords says they never considered building their own payment solution from scratch, but did consider “bolting together” different products to reach the same outcome.
In the end, Dwolla’s flat fee pricing structure and easy-to-understand API won out over the competition.
“We talked with a number of companies who didn’t have a way to support us or who understood our use cases,” Jeffords says. “But Dwolla came in with a beautiful solution. It would be extremely difficult for me to try and create what Dwolla has done using other providers. We would have had to go down a much more complex route had we not gone with Dwolla.”
Making the earnest money process a fully digital experience has put Earnnest in a unique position, says Jeffords.
“We frequently hear that this need (fully electronic transfer of earnest money) hasn’t been touched and our users are amazed we can handle this completely electronically,” Jeffords says. “That’s what works, we can take it from A-Z without any in-between user touch points and keep people notified ahead of schedule and in real-time because of Dwolla. That’s opened up almost any door we feel like walking through.”
With their ability to electronically move earnest money, larger real estate companies are taking notice. Jeffords says Earnnest has seven new product releases planned for 2019.
“What Dwolla allows us to do is create a network of solutions, rather than just a solution,” Jeffords said. “We are planning on expanding the way we use Dwolla for authentication of individuals as well as moving money for things other than earnest money.”
Plugging Into A Powerful API
Jeffords is honest and says integrating with Dwolla’s API was a lot of work…
But it wasn’t hard work.
“Was it a lot of work? Yeah, but the Dwolla team was good about getting back to us,” Jeffords says. “Specifically the legal team for some of the questions we had. Usually that can be one of the biggest holdups because nobody ever has enough of them, but Dwolla sometimes got back to us within the same day, which was pretty crazy.”
An excellent support team complimented beautiful product documentation, Jeffords says. Earnnest CIO Andrew Elster built their integration with Dwolla single-handedly and a small, but talented, product team keeps it running and builds out new features.
“Even as a small company we can work with large clients due to the ease of use, quality data and information the Dwolla Platform provides,” Jeffords says. “The fact that Dwolla also uses Slack for customer support is icing on the cake. We love it.”
Continuing to Earn Trust
Additional product releases are on the docket for 2019 and Jeffords says they plan to expand the way Earnnest uses Dwolla, to create more of a network of solutions rather than just a single solution.
“We will be doing a lot around buyer education and notifications,” Jeffords says. “We have a number of features rolling out so no matter how someone needs to get through the process, we are there to make sure it gets done without unnecessary stress or work for the real estate agent.”
Dwolla helps Earnnest really bring value to all parties in the earnest money process. “We look forward to growing more through our relationship with Dwolla,” Jeffords says.