reAlpha Tech Corp. has completed its acquisition of InstaMortgage Inc., bringing in-house mortgage lending capabilities to the AI-powered real estate technology company’s brokerage platform, according to a GlobeNewswire release and a filing with the Securities and Exchange Commission. The deal closed Aug. 19.
reAlpha (Nasdaq: AIRE) acquired all outstanding shares of InstaMortgage for total consideration of approximately $8.5 million, structured as $0.5 million in cash at closing, $1.5 million in reAlpha common stock issued immediately, and up to $6.5 million in deferred consideration payable in semi-annual installments over three years. At least $1.5 million of the deferred payments must be made in cash, with the remainder payable in cash or stock at reAlpha’s discretion.
“reAlpha is now able to originate, underwrite and fund mortgages in-house, across 38 states and Washington, D.C.,” said Mike Logozzo, reAlpha’s chief executive officer, in the announcement.
Building an end-to-end platform
InstaMortgage, founded in 2008 as Arcus Lending before rebranding in 2021, is a full-cycle mortgage lender handling origination, underwriting, funding and loan sale under NMLS designation 1035734. Bringing that capability in-house lets reAlpha combine brokerage, direct lending and title services on a single platform rather than referring homebuyers to outside lenders β a step the company has described as central to building an end-to-end homebuying experience.
Shashank Shekhar, InstaMortgage’s chief executive officer, joins reAlpha as part of the deal, according to the SEC filing. reAlpha describes itself as an AI-powered real estate technology company building an integrated platform meant to streamline transactions through brokerage, mortgage and title services on shared, proprietary AI infrastructure.
Two states, representing roughly 0.82% and 20.49% of InstaMortgage’s recent loan origination volume, still require regulatory approval for the combined entity to operate there. reAlpha and InstaMortgage mutually agreed to waive that closing condition to complete the deal on schedule, and the filing notes InstaMortgage may have to pause operations in those two states until approval comes through.
What it means
The acquisition is reAlpha’s latest move to assemble a vertically integrated real estate platform, following its earlier purchase of AI development firm Naamche. For a company built around AI-driven brokerage tools, owning the lending function gives it more control over the transaction timeline and a second revenue stream tied directly to the deals its brokerage side originates β rather than depending on referral fees from third-party lenders.
The deal is small by dollar volume, but it fits a pattern among proptech firms racing to control more of the homebuying transaction in-house as brokerage commissions face pressure industrywide. Whether reAlpha can integrate InstaMortgage’s underwriting operations smoothly β and resolve the outstanding state licensing gaps β will determine how quickly the company can market a genuinely combined brokerage-and-lending product to consumers.
reAlpha’s push into direct lending also comes as brokerages increasingly adopt AI tools to streamline operations and as lending volume across the mortgage industry shifts amid a higher-rate environment that has squeezed origination volumes broadly.
