New UK start-up Keyzy gears up for launch with rent-to-own solution

New UK start-up Keyzy promises hopeful homeowners the ability to “move in now, buy later” with the upcoming launch of its rent-to-own solution.

Keyzy is currently onboarding pilot consumers and brokers

It works by converting a proportion of an individual’s rent into a deposit, offering a higher budget than traditional mortgage lenders.

Keyzy says thanks to mortgage lender rules and out-of-date borrowing restrictions, it has “never been more difficult to buy a home”, with endless house price increases, slow wage growth and the cost of living crisis conspiring to exclude millions from homeownership.

Users begin by answering a series of questions to determine their estimated budget before applying for Keyzy to buy the property of their choice.

Keyzy performs checks on the home and the user before buying the home on the user’s behalf, handling the surveys, building insurance and other tacked-on costs.

After moving in, users pay monthly fixed payments to Keyzy, of which up to 25% are converted into reducing the purchase price when the customer comes to buy the house from Keyzy at a later date.

If the occupants decide to leave, upon finding a buyer they can walk away with their converted rent and any increase in the property value.

If they decide to buy, they pay the original purchase price plus stamp duty, legal fees and other associated costs minus the accrued value of the 25% monthly payments.

Users pay an up-front product fee between £999 and £1,999, which will be refunded if the purchase is not completed.

There is also a 1% early exit fee if customers leave the home or buy it from Keyzy before the end of the agreed lease. Those looking to apply must have a minimum household income of £30,000 and undergo reference checks with landlords and employers.

Keyzy co-founder Simon Groll tells FinTech Futures the fintech raised a £2 million pre-seed last year and is currently onboarding pilot consumers and brokers onto the platform.

The company is gearing up for launch and its waitlist is now open for signups.