- Offers home equity line and leaseback products
- Application is completely online
- Home equity line fees are limited to origination and interest on draws
Who Is Figure?
Figure is a fintech company that offers home equity line and Lease Back products. It also goes by the names Figure Lending LLC and Figure Technologies, Inc. They are located in San Francisco, CA and were founded in 2018 by Mike Cagney, former SoFi CEO.
Figure uses blockchain technology, AI, and analytics to evaluate a person’s credit, debt-to-income ratio, and home value. From customer reviews, it seems once the software approves or declines you, there isn’t anything customer service can do to change it.
What Do They Offer?
Figure offers two products: home equity lines of credit (home equity lines) and a leaseback. Because Figure’s loan approval process is automated, you’ll get a same-day decision. Monthly payments are fixed and there are no ongoing fees.
Once you make a draw, monthly payments will begin on the outstanding balance. As you pay down the draw, you can make another draw up to 20% of the total loan amount. Additional draws can be made two to five years after the origination date and based on the loan term.
Loans range from $15,000 to $150,000. Loan terms include 5, 10, 15, and 30 years.
Figure estimates home values based on their assessment of independent data sources and automated valuation models (AVMs). This means Figure may generate a home value that is different from the one you or your real estate agent has estimated.
Some qualification criteria include:
- A credit score of at least 600
- Maximum combined loan-to-value ratio is 95%
You can check your interest rate on Figure’s website without having to go through the application process. Checking your rates doesn’t impact your credit score since it requires only a soft inquiry. Once you submit an application, a hard inquiry will occur and may affect your credit score.
If you opt to have your monthly payments put on autopay, you’ll receive a discount.
If you received an offer in the mail from Figure, it doesn’t guarantee that you’ll be approved. Once an application is submitted, additional information goes with it, allowing Figure to more accurately determine your creditworthiness, which may result in being declined.
Figure’s Home Equity Line product is available in AL, AR, AZ, CA, CO, CT, DC, FL, GA, ID, IL, IN, KS, LA, MA, ME, MI, MN, MO, MS, MT, NC, ND, NE, NH, NJ, NM, NV, OH, OK, OR, PA, RI, SD, TN, WA, WI, and WY.
Figure also offers Home Lease Back. With a leaseback, the homeowner sells their home to Figure. Figure then leases the home back to the (previous) homeowner. The homeowner can receive up to 92% of the equity in the home. The homeowner can also buy back the home at a later time.
A leaseback is different from a reverse mortgage. With a leaseback, you are basically renting the home. This means you aren’t responsible for costs associated with homeownership, such as:
- Home insurance
- Property taxes
- HOA fees
Monthly rental payments are set at a market rate based on nearby rents. Leases are for one year and auto-renew at the end of the year. It’s possible rent can increase but increases are capped, allowing the renter time to prepare for any payment increase.
From Figure’s website, leasebacks are available in “Atlanta, GA; Cincinnati, OH; Cleveland, OH; Dallas, TX; Houston, TX; Jacksonville, FL; Philadelphia, PA; Phoenix, AZ; Pittsburgh, PA; Reno, NV; San Antonio, TX; and Tampa, FL.”
Are There Any Fees?
Yes — for the home equity line, Figure charges two fees:
- Interest rate on drawn amount that ranges from 4.99% to 13.74% APR. The interest rate is fixed for each draw.
- Origination fee based on initial draw that ranges from 0% to 3%.
You won’t find the following fees with Figure:
- Maintenance or appraisal fees
- Late fees
- Prepayment penalties
How Do I Apply?
One thing to note: some reviewers have mentioned that Figure only works with certain banks. If you want to use your bank, check that it is on their list of banks before applying. Otherwise, you may go through the entire loan application process, get approval, and then find out you can’t get financing because your bank isn’t one Figure uses.
To notarize documents, Figure uses an eNotary. Part of the application process involves meeting with a notary online through a video/audio-enabled session. During this session, you’ll electronically sign documents. Then the notary will digitally notarize them. There is no in-person interaction with Figure’s loan application process.
Is My Information Safe?
Figure may use your information to market its own products to you. Some reviewers have mentioned Figure’s marketing can be aggressive.
Is It Worth It?
Figure offers a straightforward loan application process that can be completed entirely online. For those that want speed and the convenience of not having to go to a bank, Figure is a great option.
Before applying, check that your bank is one Figure works with. Also, don’t assume that Figure will use your home value numbers. They calculate their own proprietary numbers for home values.