EasyKnock, facing fire on multiple fronts, abruptly shuts down
Residential sale-leaseback platform EasyKnock has abruptly shut down its operations after facing scrutiny from state regulators and being under fire from disgruntled consumers.
“After many years of serving consumers, EasyKnock has closed its doors,” a message on the company’s website states. “We are deeply grateful for the trust placed in us to be part of the financial journey of so many. While EasyKnock may no longer be around, arrangements have been made to ensure continued services for our customers.”
New York-based EasyKnock’s business model allowed homeowners to sell their properties to the company but remain as renters while receiving cash for their financial needs. Jared Kessler founded the fintech in 2016 and has since raised money from several venture capital firms.
In February 2024, the company closed a $28 million Series D funding round from new and existing investors, including Gaingels, Moderne Ventures, QED Investors and Zillow co-founder Spencer Rascoff. This followed a $57 million Series C round in February 2022. In 2018, the company raised $3.5 million in seed funding, including $100 million in new debt.
An acquisition spree followed. The company closed deals with struggling power buyer firm Ribbon in May 2023, home maintenance company Onder in September 2023, home equity investment firm Balance Homes in December 2023 and home equity investment firm HomePace in May 2024.
But the company came under the scrutiny of state regulators in December 2023. That’s when Massachusetts Attorney General Andrea Joy Campbell announced a settlement with EasyKnock for what her office alleged were deceptive practices that stripped consumers of their home equity.
According to the claims, the firm was purchasing homes of “cash-strapped consumers at bargain-basement prices and then renting them back to the consumers, at times for unfair rents,” in violation of the state’s consumer protection law.
After that, consumer lawsuits were filed in Texas, Maryland, South Carolina, Pennsylvania and Ohio. Actions from state regulators were taken in Massachusetts, Michigan and Connecticut.