(Bloomberg) —
London & Country Mortgages Ltd. is in talks with Habito about a possible combination to create one of the U.K.’s largest mortgage brokers, according to people familiar with the matter.
Both firms are working with advisers on a deal that could be announced in the coming months, the people said, asking not to be identified because the talks are private.
They’re keen to combine London & Country’s army of over-the-phone advisers with Habito’s online technology platforms, the people said.
Discussions between the two companies are ongoing and could still be delayed or fall apart, according to the people.
“We look forward to sharing more about our growth plans for 2022 and beyond in due course,” a spokesperson for Habito said, declining to comment further.
A representative for London & Country declined to comment.
Britain’s top mortgage lenders, Halifax and Nationwide Building Society, said earlier this year that they expect the housing market to slow in 2022 as rising taxes, interest rates and utility bills strain consumers.
Habito was founded in 2016 by Daniel Hegarty, following his difficult experience of buying a house.
Backed by venture capital, it aims to simplify the administration of home buying, from finding mortgages to handling property surveys and legal work. Habito’s last funding round valued it at about $180 million, the people said.
London & Country was established in the 1980s.
The company collects fees from lenders when a mortgage agreement completes and doesn’t seek an additional charge from its customers, according to its website.
Incumbents across the financial services sector have been looking to tie-up with tech-savvy digital startups in a bid to stay relevant and competitive.
Last year, JPMorgan Chase & Co. agreed to buy U.K. digital wealth manager Nutmeg Saving and Investment to expand its mobile banking service for retail investors in the country.
To be sure, technology valuations are facing headwinds after a year of record fundraising and investment, exacerbated by the volatility caused by Russia’s invasion of Ukraine and rising inflation and interest rates.
(Updates with London & Country response in fifth paragraph.)
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