Approval AI

What do they actually do

Approval AI is a mortgage-shopping and application assistant. Buyers fill out one form and the product helps compare offers across banks, credit unions, and other lenders, negotiates on the buyer’s behalf, and organizes the paperwork through to closing. It positions itself around “One Form. All Lenders.”, a “Zero Spam” privacy promise, and access to “True Market Rates” so shoppers can see and choose from multiple real offers in one place (site, YC profile).

Today, the company operates as a licensed mortgage broker in Texas (NMLS #2751459) and says it is currently available only to Texas residents, with an AI assistant plus optional human support for questions and edge cases (site FAQ and footer).

Who are their target customer(s)

• First-time homebuyers: They don’t understand how mortgages work, are intimidated by paperwork, and often take the first lender they find rather than shopping across options (YC profile, site FAQ).
• Buyers in hot markets who need strong pre-approvals: They need clean, fast pre-approvals and quick rate options to stay competitive; fragmented lender workflows and weak letters can cost them deals (site, third‑party summary).
• Busy professionals/families: They lack time to upload documents to multiple lender portals or negotiate; they want one submission and someone (or something) to shop and track everything for them (site: “One Form. All Lenders.”, YC profile).
• Privacy‑sensitive shoppers: They’ve been burned by rate‑shopping that led to spammy calls and emails; they want to compare without having their data widely shared (site: “Zero Spam”, YC profile).
• Rate‑sensitive homeowners/refinancers: They suspect they could materially save but struggle to compare true rates and fees, and dislike the effort and opacity of negotiating better offers (site: “True Market Rates”).

How would they acquire their first 10, 50, and 100 customers

• First 10: Founder‑led concierge onboarding via personal networks and local real‑estate contacts; handhold each user end‑to‑end to gather feedback, refine onboarding, and produce brief testimonials (site, YC profile).
• First 50: Pair targeted paid search/social in 1–2 competitive metros with small agent/brokerage referral pilots; collect examples of stronger pre‑approvals and agent testimonials to prove win‑rate impact (site, third‑party summary).
• First 100: Scale repeatable channels: launch lightweight user/agent referrals, publish first‑time buyer guides and calculators for SEO, integrate with initial lender partners to automate quote collection, and systematize paid search using the refined onboarding playbook (site, YC profile).

What is the rough total addressable market

Top-down context:

The U.S. mortgage market is large and active: MBA expected about 5.1 million total mortgage originations in 2024 and 6.5 million in 2025, with total dollar volume around $2.3T in 2025 (MBA forecast).

Bottom-up calculation:

If a platform like Approval AI ultimately serves U.S. purchase and refi borrowers and earns roughly $1,000 net per funded loan (via broker compensation or referral economics), applying that to the MBA’s 2024 loan count implies a rough TAM of ~5.1 million × $1,000 ≈ $5.1B/year. For context, MBA data show average new‑home purchase loan sizes near ~$396k in late 2024, so broker‑style bps economics could support similar or higher per‑loan revenue depending on mix and model (MBA BAS release, MBA BAS Nov. update).

Assumptions:

• Counts include both purchase and refinance originations and are used as a proxy for total eligible transactions (MBA forecast).
• Average net revenue to the platform per funded loan ≈ $1,000 (varies by broker vs. marketplace model and lender mix).
• Regulatory/licensing expansion beyond Texas is feasible over time; near‑term serviceable market is smaller until additional states are added (site FAQ).

Who are some of their notable competitors

• Morty: Digital mortgage broker that shops across lenders with a single application; close to the “one form, many lenders” model.
• Better Mortgage: Online direct lender with fast pre‑approvals and a digital process; large brand and marketing reach.
• Rocket Mortgage: Largest U.S. retail mortgage lender; strong consumer brand, fast underwriting, and widely accepted pre‑approval letters.
• Zillow Home Loans + Zillow Marketplace: Combines an in‑house lender with massive audience reach and rate‑shopping tools that funnel demand to loan officers.
• LendingTree (Mortgage): Lead‑gen marketplace that connects shoppers to multiple lenders; broad lender network and heavy performance marketing.