Founded in 2018, Figure is a San-Francisco-based financial technology company. It is one of the companies that have incorporated artificial intelligence and blockchain technology in their lending processes to speed up loan processing.
It offers home equity line of credit and mortgage refinance loans to homeowners looking to tap into their home equity. However, it does not offer mortgages to potential homeowners looking to buy their homes.
Figure offers the following two loan products:
- Home Equity Line of Credit (HELOC)
HELOC is Figure's flagship loan product, and it is a popular way for homeowners to fund home repairs, improvements, or large purchases. You can apply for a HELOC loan using the fully-online application process, and borrow any amount from $15,000 to $250,000 with a repayment term of 5, 10, 15, and 30 years.
Once you've submitted your application, you can get a decision in just five minutes, and receive funding in five days. While there are no maintenance fees, you should expect to pay a one-time loan origination fee of 0% to 4.99% depending on where you live. Figure requires a credit score of 620 (720 for Oklahoma) to qualify for HELOC.
- Mortgage Refinance or Cash-Out Refinance
Applying for a mortgage refinance on Figure's website takes less than 10 minutes. When you submit your application, you can prequalify for the loan to know the offer and rate you will get without affecting your credit score.
For the mortgage refinance, you can borrow up to 80% of the accumulated equity, with a maximum limit of $1,500,000. You can also opt for a cash-out of up to 75% of your home value, or a maximum of $500,000. There is a 15-year and a 30-year term, and you can lock in a fixed-rate APR for the entire term. Figure requires a credit score of 620 (700 for Jumbo loans) or higher to qualify.
On FIGURE Secure Website
Minimum Credit Score
How FIGURE Mortgage Refinance Work?
Figure mortgage refinance allows homeowners to tap into their home’s equity, with a possibility of borrowing up to 80% of the home value. Figure has an online mortgage application that you can fill from the comfort of your home, and get a response in minutes. You can opt for a cash out mortgage or a new mortgage with better terms to replace the current mortgage.
If you decide to cash-out, you can take out a new higher value mortgage to replace the current mortgage. The difference between two loans and what you owe is the amount you receive in cash. You can use the cash to pay debts, home repair, or home improvements.
Some of the unique characteristics of Figure’s Mortgage Refinance include:
You can prequalify for Figure Mortgage Refinance to get a quote of the interest rates and loan amount you will get. Prequalification does not affect your credit rating.
- Mortgage Loan Term
Figures offers a 15-year or 30-year term for mortgage refinancing. The monthly payments are fixed for the duration of the loan. Jumbo loans are only available in a 30-year term. You can borrow up to 80% of your home equity, up to $1,500,000, or take a cash-out up-to 75% of the home’s equity, up to $500,000.
- Flexible Repayment
Figure allows borrowers to pay off their mortgage refinance loans ahead of schedule without paying prepayment fees.
- Cost and fees
While there are no origination fees charged to borrowers, you can expect to pay recording fees, appraisal fees, settlement fees, and discount fees on your Figure mortgage refinance. These figures can add up to 2% of the total loan amount.
- Credit Score
Figure requires a minimum FICO score of 620 for mortgage refinance. However, it requires a 720 minimum FICO score for Oklahoma residents. Jumbo loans have a minimum FICO score of 700.
- The loan-to-value ratio and Debt-to-Income Ratio
Figure allows borrowers to borrow up to 80% of the home’s value, while for Jumbo loans, you can borrow up to 75%, up to the maximum value. There is a maximum debt-to-income ratio of 50%, while Jumbo loans require a maximum 43% debt-to-income ratio.
The Pros & Cons
Mortgage Application Process
The mortgage refinance application is fully online, and you can complete the application in about 10 minutes. Follow these steps:
1. Select “Find My Rate”
On the Figure website, go to “Find My Rate” in the Mortgage Refinance option.
2. Provide Information
On the mortgage refinance page, you will need to provide personal information including legal name, address, date of birth, income, property location, property value, etc. Then, select continue and create an account.
3. Go over your quote
Once you provide your personal information, Figure will gather information and do a soft pull to determine if you qualify. The lender will then give you an offer and a rate to review.
4. Verify your Income
Add your bank account on Figure to verify your income. Figure will automatically pull your financial transactions and use a third-party application to verify your income.
5. Submit Application
Once you’ve provided all the documents required, you can submit your application. You will receive an approval confirmation email, and you will be required to e-sign the loan documents.
6. Order Appraisal
Once the application is approved and loan documents signed, Figure will order an appraisal and title search. The lender will send an appraiser to conduct a valuation of your property. The lender may also contact your employer to validate your employment status. Appraisal and title search may take several days to complete.
When the loan process is finalized, Figure will send you an email to schedule closing and sign your loan disclosure. You can sign the disclosure from the account dashboard.
FIGURE Home equity Line: How Does It Work?
If you have accumulated enough equity on your home, you have probably thought about using the equity to fund urgent expenses through a home equity line of credit.
However, for most homeowners, the process of obtaining a HELOC can be time-consuming. Figure simplifies the application process through an online-only application process that allows homeowners to apply for a HELOC and get approved in minutes.
You can get a home equity line of credit from $15,000 to $250,000 in just five days. The actual amount you receive depends on the equity in your home, Figure allows you to borrow a portion of that equity.
Some of the features of HELOC include:
- Seamless Application Process
Figure has an online-only HELOC application and approval process. It is one of the few lenders that have incorporated artificial intelligence and blockchain technology to speed up loan processing.
After submitting your application, Figure will make a decision in less than five minutes. If approved, you can get funding within five days.
- Competitive Rates
If you have a good credit score, you may qualify to get an attractive rate for your home equity line of credit.
Figure charges an origination fee of 0% to 4.99% depending on various factors such as credit score, credit history, and your location. There are no appraisal or maintenance fees charged on the loan. Figure's HELOC has an annual APR of 2.88% to 13.25%.
- Low Credit Score
You can qualify for a Figure home equity line of credit with at least 620 FICO credit score (720 for Oklahoma). If you have a credit score above 700, you may qualify for an attractive rate and higher loan amount.
- Loan term
You can borrow anywhere from $15,000 to $250,000 for a home equity line of credit. Figure offers different loan terms for home equity loans ranging from five, 10, 15, or 30 years.
You can make draws on your home equity as you repay the HELOC, with a limit of two to five years from the date of loan origination.
You can get prequalified for a HELOC to know the APR you get based on your income, home equity, credit, and loan amount. You can use the quote to compare offers from multiple HELOC companies to know where you get the best deal.
- Combined loan-to-value ratio (CLTV)
Figure allows a maximum of 95% combined CLTV, which is one of the highest in the market. It is calculated by taking the ratio of debts secured by the home and the actual value of the property.
HELOC Application process
Figure has an all-online application process, where you file an online application, e-notary, and e-signature.
Follow these steps to get a home equity line from Figure:
1. On Figure’s website, click “Find My Rate” in the Home Equity Line option.
2. Provide Personal Information
On the registration page, you will be required to provide your personal information. Some of information required include:
- Legal name
- Date of birth
- Annual gross income
- Property Address
- Type of property
- Email address
- Reason for borrowing
If you meet the evaluation criteria, you will get a quote for the maximum loan amount you can get, the APR, and the origination fees.
3. Submit full application
If you are comfortable with the quote, proceed with the online application to provide more information. You will be required to provide a government-issued ID, proof of homeowner insurance, proof of flood insurance, and link your bank account or other income source.
Figure will run a hard credit check to confirm your credit score and check your bank transaction history to verify your income. You will receive a final approval in less than five minutes.
4. Virtual Closing
After getting HELOC approval, you will be required to do a video session with Figure's e-notary to verify your identity and sign the loan documents. The e-notary will digitally notarize your signed document as the final step before funds are disbursed.
5. Receive funds
Figure will disburse the funds electronically to your checking account. You will get the funds in about five days.