Social Finance Inc. is sketching out plans to start a real estate investment trust that would buy the mortgages the startup lender makes, according to two people with knowledge of the matter.

Executives at the company are considering the idea as a way to raise money at low cost to lend out long term, the people said, requesting anonymity because the talks are private.

The company makes home loans as big as $3 million, focusing on borrowers with stronger credit profiles. Many of its customers are seeking mortgages that are too big to be funded through government housing finance companies like Fannie Mae and Freddie Mac.

SoFi, which calls itself a technology-enabled lender and specializes in student loan refinancing, branched into residential mortgages last year and has been looking for ways to fund the loans.

SoFi spokeswoman Debra Jack declined to comment on the company’s funding strategies. Debtwire earlier reported SoFi’s REIT discussions.

Mortgage REITs have struggled in recent years to fund themselves cheaply. Shares of many of the biggest firms trade at a discount to the net accounting value of their assets, known as their book value. 

REITs were dealt a severe blow in January when the top housing regulator closed a loophole that had allowed some of them to fund with the Federal Home Loan Bank by creating their own in-house insurance companies.

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