Fraction makes finance fair. The Fraction Mortgage is an innovative, no-monthly payment mortgage with no hidden fees. Homeowners can use the funds for anything – paying off high-interest credit card debt, paying off a large, unexpected expense, starting a business, or even buying a second home.
Fraction began with a simple idea… could there be a fairer way to help people access the equity in their homes? Coming from a technology background, our team approached the problem differently than the financial veterans who dominate the industry. We looked at the problem from the perspective of the homeowner.
We champion empathy, innovation, and resourcefulness within our teams and when we are interacting with our customers and partners.
Tell us about yourself?
My name is Hayden James, and I am the CEO and Co-Founder of Fraction.
I am a husband, father, and serial entrepreneur looking to make the homeownership experience fairer.
I’ve had many roles – from a solutions consultant at Realtor.com, a cofounder at Ampify (a fully automated digital marketing mobile app for real estate agents), a founder and patent holder of an innovative new hockey tape to a competitive hockey player, I’ve definitely worn many hats in my lifetime.
I built Fraction as a response to existing financial options – all of which tended to work against the people they were meant to help. I deeply care about ensuring everyone has the right to access fair and flexible financial options.
If you could go back in time a year or two, what piece of advice would you give yourself?
I would tell myself that it’s impossible to know where you are going, but follow what you love. This has been a guiding principle for me over the years. Every time I start something new or attempt a new venture, I’m taking a massive risk. But in my heart, I know what I am choosing to do comes from a desire to help impact how people live by offering them fairer and more equitable financial options. Also, sell the time machine.
What problem does your business solve?
Fraction helps Canadians reduce how much they spend monthly paying down their debt. Our no-payment mortgage product helps people reduce the burden of increasing interest rates and monthly payments. We have, on average, helped homeowners reduce their debt-to-income ratio (the amount you spend monthly paying back debt) by up to 50 per cent on average simply by removing monthly payments. We also typically help raise the credit scores of our borrowers by 30 points.
These numbers can be life-changing. It can mean a life with fewer stresses, worries and an assurance of security for themselves and their loved ones. By tapping into their hard-earned home equity with an approachable mortgage like ours, Canadians can weather whatever economic shifts come their way this year and into the future.
What is the inspiration behind your business?
It’s getting tougher and tougher for many to make ends meet. The current financial market has shown so many cracks in our existing financial products – there is an appetite for something different, something fairer.
Fraction is possibly the first innovative mortgage product in around 100 years. Offerings like ours allow homeowners to take more ownership of their homes and financial futures.
With nearly trillions of dollars of equity locked into homes across Canada, we knew there had to be a better way to enable homeowners to take control of their finances. It was time to bring something to the market that was equitable, flexible, and had no monthly payments.
What is your magic sauce?
We approach things with a new lens. Thanks to our tech background, our team approached long-standing problems in the financial services industry differently from the incumbents.
We looked at the problem from the homeowner’s perspective, not the bank’s. We use this formula for many of our business decisions: what is the fairest and more transparent way to help the most people?
What is the plan for the next 5 years? What do you want to achieve?
The current financial market is putting homeowners in a very interesting position. We know that things are changing rapidly and that many people may need support and relief over the next little while. We’re excited to continue to provide homeowners with products that help them save more money in the long run and also help them grow their wealth.
I really believe that our product can help fix the intergenerational cycle of real estate by increasing access for both homeowners and investors in a mutually beneficial way. It is super promising and will hopefully lead to more equality in our society. Fundamentally, using technology to scale what we are doing helps us accelerate this impact and provide the best user experience possible.
What is the biggest challenge you’ve faced so far?
Due to years of financial inequity, the relationship between borrower and lender has been fraught with mistrust. This has been a conscious choice on behalf of many lenders to actively attempt to convolute messaging and impose unnecessary fees and penalties on borrowers.
The industry has always favoured the institution or lender. But startups like ours are emerging and built with the borrower in mind. We exalt fairness and transparency, and above all, we want our homeowners to understand the power they have in accessing their equity.
How can people get involved?
Interested in learning more about Fraction? Check us out today at www.Fraction.com.