Figure Home Equity Review: My Personal Experience

Homeowners can leverage the equity in their house to take out cash, establish a line of credit, or score better terms on a new mortgage.

But borrowing against your home and refinancing your mortgage are both arduous processes that can take weeks to months. And you often have to jump through a lot of hoops and paperwork to get there.

Figure is a company trying to make this process simpler and faster through the power of technology. 

Have they succeeded in their goal?

In this Figure home equity review, I’ll discuss my personal experience in applying and eventually taking out a loan with the company. 

Plus, I’ll go in-depth about how Figure works, their products, and more.

My Experience Obtaining a Figure Home Equity Line of Credit

I recently went through the process of obtaining a home equity line of credit for a home renovation project.

I wanted to get quotes from a few different banks, so I researched the top providers of HELOCs (home equity lines of credit) and then set out and applied. 

My first stop was to apply with PNC and Citibank, as those two banks seemed to have the most recommendations across the largest financial sites.

That said, my tax situation is complicated.

I’m self-employed, with a business that’s only a few years old. That’s red flag number one for traditional banks.

The second (and bigger) red flag was the multiple K-1s I file each year — some of which requested an extension, pushing their tax filing deadline to October 15th.

Therefore, when these banks asked me for the current year’s paperwork, my answer was that I couldn’t provide it. And when they requested additional information in lieu of those K-1s — like up-to-date profit and loss statements, balance sheets, etc. — getting all that information would have taken hours of work. 

There was really no getting around this…

I had never applied for a HELOC before. My assumption was that it would be easy. I have about 50% equity in my home, a high credit score, solid income, and my mortgage is my only debt. 

Heck, I could walk into a car dealership today and get a loan for a new $60,000 car. So my assumption was that getting a HELOC for a fraction of that amount would be a piece of cake. 

Needless to say, I was starting to get worried. This home renovation project had already been delayed multiple times for various reasons, and we finally had a contractor and a firm quote in place. Plus, we wanted to get things done during the summer, before the cold weather kicked in. 

Enter Figure. 

I hadn’t heard much about the company until their partnership team reached out to me. But I did like their promise of funding a loan in as little as five days¹. Just as important, they offered a 100% online application.

So I dug around their site a bit more, read some reviews, and then entered the basic info that most lenders ask for: name, address, income, financing purposes, etc.

With PNC and Citibank, I had a dedicated account rep after entering this basic information. We then emailed back and forth multiple times, attaching necessary paperwork like tax returns and bank statements.

On Figure’s application, they have a section called “Link Income Sources.” This is where you provide proof of income and assets to secure the loan. 

Rather than uploading documents, what you’re doing is linking accounts then allowing Figure to automatically extract the necessary data. This process takes about a minute. 

I linked my checking account, my investment accounts, and provided access to my tax documents by connecting to irs.gov. 

And that was it. 

My income was verified. And within a day, my loan was approved. 

The next Friday, my wife and I scheduled a meeting with one of Figure’s e-notaries. We had to do a live video chat for a few minutes to confirm our identities (including showing our driver’s licenses). 

On the following Thursday, the money was in my account.

So that’s my experience. I was grateful Figure came through for me. 

For the remainder of this Figure review, I’ll dive into why Figure is different from traditional banks and how they’re able to make the process of applying for a HELOC much smoother.

The Basics of Figure Home

Figure Technologies Inc. — started by SoFi co-founder Mike Cagney and his wife June Ou — is a financial company that uses blockchain technology and AI to efficiently provide various types of home lending solutions to individuals. 

A quick explanation of blockchain: blockchain is a form of distributed ledger that uses cryptography to keep transparent, unalterable, digital records of transactions and transaction data. You can read more about it here.

Figure uses blockchain technology to cut out the middleman (the financial institutions) to make home lending more efficient, more secure, and less costly. 

Figure’s core offering is a home equity line of credit. People can use a home equity line to borrow against their home equity (the amount of their home they “own”) for flexible access to cash. 

Figure, or one of its approved sub-servicers, will service your loan.

The Application Process

Figure’s application process is entirely online. 

You’ll provide the following information:

• Name
• Date of birth
• Primary mailing address
• Email address
• Reason for borrowing
• Social Security number
• Citizenship status
• Estimate of your annual income
• Proof of insurance (homeowner’s insurance, flood insurance if you live on a flood plain, and any other hazard insurance that may be necessary)

Figure then runs a soft credit check, which doesn’t affect your credit score, and shows you offers.

From there, you can pick an offer and apply. 

The lender then runs a hard credit check (which slightly affects your credit score). 

You’ll need to link your checking account for income verification and loan disbursement if they approve you, and you’ll have to provide a government-issued ID — such as a driver’s license, passport, or state ID — to verify your identity.

Finally, you work with a remote notary over video chat to sign all relevant documents and finish the process. If you live in an area that doesn’t allow remote notarization, Figure sends a notary to your location to sign the paperwork.

If you have any questions while applying, you can contact Figure’s customer service team by email or phone, or live chat with an agent on Figure’s website.

Key Facts

1. Figure uses blockchain technology which helps improve financial transactions behind the scenes to make them more efficient, more secure, and less costly. That’s how they can approve and fund you so fast.
2. On Figure, home equity line APRs vary depending on your credit score and report, the combined loan-to-value ratio on your home, and the state in which your home is located. You can also enroll in autopay and become a member of Figure’s partner, Quorum Federal Credit Union, to get a discount; the latter is as simple as checking a box.

Pros and Cons

Pros: 

• Fast application and funding. Figure’s application takes as little as five minutes, and they can fund your account in as little as five days¹. Many lenders take 30-45 days to get you your home equity line or loan.
• Second homes and investment properties. Figure allows borrowers to take out credit lines on second homes or rental properties they own. Few other home equity lenders offer this.
• High borrowing limits. Figure offers home equity lines up to $750,000. Many lenders cap theirs at $500,000.

Cons:

• Origination fee. Figure charges an origination fee of 0% to 4.99% of your initial draw, depending on your credit profile and the state your property is located in. At the higher end, that can be a significant sum on a large loan.
• Availability. Figure is not available in all states at the time of writing, so you’ll have to check if they’re in yours.

Loan Types

Figure’s main offering is a home equity line of credit.

Often called a HELOC, this lets you borrow against your home’s equity on demand. 

Figure used to offer mortgage refinancing — including a cash-out option — but it has since retired those products to focus on its HELOC. If you’re looking to turn some of your equity into cash, you’ll do that by drawing on a home equity line.

Figure requires a fair credit score at minimum. Borrowers with low credit scores may struggle to obtain credit through Figure.

Home Equity Line

As mentioned, HELOCs let you borrow funds on-demand while using your equity as collateral. 

Loan amounts	$15,000 – $750,000.
Loan terms	10, 15, 20 or 30 years.
Debt-to-income ratio	Under 50% (under 45% in select cases).
Minimum credit score	600
Origination fee	0% – 4.99% of your initial draw.
Appraisal fee	None for most loans. If an automated valuation isn’t available for your property, a $180 valuation fee applies. Loans over $400,000 require an appraisal ($500 – $2,000, depending on property type, value and state).
Prepayment penalty	None.
Late fees	None.
Other fees	Manual notarization ($350) if your county doesn’t permit eNotary. Recording fees ($0 – $315) and recording taxes, which vary by state and county.

Figure’s HELOCs have some of the lowest possible interest rates out there if you meet the requirements. 

People often use HELOCs to handle large expenses fast (like a home renovation), or to consolidate several smaller debts. For these reasons, Figure advertises them as alternatives to personal loans.

Besides that, Figure’s HELOCs are renowned for their phenomenal interest rates and fast funding times. You can apply within five minutes and be approved and funded within five days¹. Most other lenders can take up to 45 days.

One thing to keep in mind is insurance. Figure requires all HELOC borrowers to have homeowner’s insurance. If your home is located on a flood plain, you also must have flood insurance and provide proof while applying.

Figure Home Equity FAQ

Figure Review: Final Thoughts

Figure’s home equity lines are excellent overall, with fast funding times and few fees. 

As long as you have a strong credit score and low debt-to-income ratio, you can score some great rates. 

Blockchain and AI technology are making significant changes to the home lending industry by making these products available to borrowers in a fraction of the time it takes traditional lenders to do so. Figure is a prime example.

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Figure Home Equity Line is available in AK, AL, AR, AZ, CA, CO, CT, DC, FL, GA, IA, 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, VA, VT, WA, WI, WY with more states to come.

Figure Lending LLC dba Figure. 100 West Liberty Street, Suite 600, Reno, NV 89501. (888) 819-6388. NMLS ID 1717824. For licensing information go to www.nmlsconsumeraccess.org. Equal Housing Opportunity. Licensed in Alabama 22533, Alaska AK1717824, Arizona 0948458, Arkansas 114692, California: Loans are made and arranged pursuant to a Finance Lenders Law License, Licensed by the California Department of Financial Protection and Innovation under the California Residential Mortgage Lending Act (License 41DBO-94904) and Finance Lenders Law (License 60DBO81967), Colorado 1717824, Connecticut  ML-1717824, District of Columbia MLB1717824, Delaware 026994, Florida MLD1636, Georgia Residential Mortgage Licensee 61229, Idaho MBL-9625, Illinois MB.6761349, Indiana 39933, Iowa 88893478 and 2018-0048, Kansas MC.0025537 and SL.0026703, Louisiana 1717824, Maine 1717824, Massachusetts Mortgage Lender License ML1717824, Michigan FL0021494, Minnesota MN-MO-1717824, Mississippi 1717824, Missouri 19-2421, Montana 1717824, Nebraska 1717824, Nevada 4823, New Hampshire 22423-MB, Licensed by the N.J. Department of Banking and Insurance, New Mexico 1717824, North Carolina L-180811, North Dakota MB103310, Ohio RM.804317.000, Oklahoma ML011894, Oregon ML-5698, Pennsylvania 66882, Rhode Island 20183626LL, South Dakota ML.05202, Tennessee 151185, Virginia MC-6844, Vermont 7310, Washington CL-1717824, West Virginia ML-36248, Wisconsin 1717824BA, Wyoming 3217

¹ For Figure Home Equity Line, five business day funding timeline assumes closing the loan with our remote online notary. Funding timelines may be longer for loans secured by properties located in counties that do not permit recording of e-signatures or that otherwise require an in-person closing.