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Loftium co-founder Yifan Zhang talks about the future of home buying at Seattle Startup Week. (GeekWire Photo / Monica Nickelsburg)

Yifan Zhang believes that in the next five to 10 years, prospective home buyers will have three standard options for coming up with a down payment: Save, ask for a parental gift, and sign up for Loftium.

It has been two weeks since Zhang and her co-founder Adam Stelle officially launched Loftium, a Seattle startup that provides down payment assistance for home buyers who are willing to rent out a spare bedroom on Airbnb and split the profits. Based on early interest, Zhang is expecting the business to scale rapidly.

She shared her audacious goals during a Techstars Startup Week event in Seattle on Tuesday. The panel titled, “The Future of Homebuying,” included Zhang, FlyHomes co-founder Tushar Garg, and Flipt founder Andrey Nokhrin.

“Our goal is to become a standard, almost like a parental gift,” she said. “The parental gift wasn’t always a thing. It had to become a thing that’s accepted by most banks. We want Loftium to also become that type of standard where anyone in any expensive city, where the down payment is a hurdle, has access to Loftium funds if they’re willing to rent out an extra bedroom.”

Loftium’s technology predicts how much revenue an Airbnb will generate in the neighborhoods where a customer is house hunting. Using that data, the Loftium team determines how much down payment assistance each customer is eligible for. For example, a customer looking to buy in a popular Seattle neighborhood could receive $20,000 in down payment assistance, agree to rent a bedroom for somewhere between 12 and 36 months, and give Loftium 70 percent of the monthly revenue generated from Airbnb, retaining the other 30 percent for herself.

Loftium co-founders Yifan Zhang and Adam Stelle take a novel approach to down payment assistance. (GeekWire Photo / Monica Nickelsburg)

In the first two weeks, Loftium has helped two customers close on homes. For now, the service is only available in Loftium’s hometown, Seattle, but Zhang expects to expand to other cities soon.

Previously: Loftium will help you buy a house if you agree to Airbnb a bedroom and split the profits

“Long-term, we’d like to be able to have a number of Loftium properties across the country, to the point where every Loftium property will see about 100 to 200 Airbnb guests coming through that extra bedroom every year,” she said. “Those people are typically the future buyers. They’re renters. They’re traveling. They’re saving money by renting a private room in someone’s house. I think that we have a chance to touch base with people earlier and really shape the way that people think about home buying.”

It’s an ambitious vision, but Zhang is emboldened by the fact that her team has already done the “impossible.” Real estate experts told her time and again that she would never be able to get approval from federal regulatory behemoths to launch Loftium.

“Everyone told me there’s no way that we could get … Fannie Mae, Freddie Mac, to be able to actually do this because they’re the regulators who actually decide what funding can be used toward a downpayment,” she said.

But Zhang’s background is in consumer tech, not real estate. “I didn’t know it was impossible,” she said. So she and Stelle assembled their team and started the long, slow process of convincing federal regulators to sign off on this novel service.

“We worked with them through all of their concerns, legal compliance, credit policy, and we were finally able to launch, slower than we would have liked for a typical consumer-facing company but we achieved something that most people in the industry thought was impossible in about six months,” she said.

Loftium is partnering with Umpqua Bank initially and planning to offer down payment assistance to 50 customers in Seattle, its pilot city. From there, Stelle and Zhang expect to scale the business to new cities and partner with additional lenders.

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