The HELOC experience has been forever changed by Figure
Home Equity  blog tag

The HELOC experience has been forever changed by Figure

You may have heard that securing a HELOC is a lot like getting a mortgage: there’s a sea of information to wade through, a stack of paperwork to fill out, and confusing fine print to weigh up. In short, it’s a complicated time drain. While that may be true with traditional lenders, Figure allows you to unlock your home equity with speed and ease. Instead of the typical four to six weeks, it takes to wrap up the entire loan process, with Figure, you can be approved in five minutes and get funded in as little as five days.(1) What’s more, you could get a cheaper deal too.

Okay, so why is Figure different?

By leveraging powerful blockchain technology, Figure is able to turn the usual loan process on its head and deliver speed and efficiency to customers. Although blockchain is often associated with cryptocurrency, it has many other uses — like loan origination, servicing, and payment settlement, for example.

Put simply, blockchain is a record-keeping tool — like a database or a ledger. What sets this tech apart from other databases and ledgers is that it doesn’t rely on a central authority to approve and verify every record. In the context of banking and finance, transactions are created and stored as blocks in multiple places on the blockchain network. Once recorded, they can’t be changed without agreement from all network members.

So how do Figure’s HELOC customers benefit from this ultra-high-tech setup?

  • Line of credit you can afford. Unlike other lenders, Figure only charges an origination fee to cover the cost of providing the credit facility, meaning you’ll save on account opening fees, maintenance fees, and prepayment penalties.(2)

  • Tap your home equity at lightning speed. Figure’s technology eliminates the need to pass hard copies of documents back and forth, meaning your HELOC application can be approved and funded at lightning speed.

  • Unparalleled security for peace of mind. Every data block on a blockchain is encrypted. All records and any subsequent changes must be verified and agreed upon by all parties. These features and requirements make unauthorized changes both difficult and unlikely.

What a HELOC can do for you

Now that you know why Figure is your best bet for getting fast approval, let’s take a closer look at how HELOCs can be a great planning tool for homeowners.

A HELOC is a revolving line of credit that allows you to unlock the equity that has built up in your home. You can spend any amount as needed, provided you’re still in your draw period and you don’t go over your approved limit. Interest is charged only on the amount you borrow. If you repay your entire outstanding balance in the draw period, then you can borrow again up to your limit.

Because of their flexibility, HELOCs are ideal when you’ve got a big expenditure coming up, but you don’t know exactly how much it’ll cost.

Here are some typical ways homeowners make use of a HELOC:

  • Adding value to your home. Whether you’re preparing to sell or renovate for your own comfort, a line of credit offers a flexible way to finance your home improvement. While tax laws are prone to change, tax benefits may be available with home equity debt to offset the cost of your renovation project.(3)

  • Consolidating debt. If you’re having a hard time juggling multiple obligations — student loans, medical bills, and credit card debt for instance — bringing them all together can streamline payments and reduce your financial headache. Since a HELOC is secured against your home, its interest rate is likely to be lower than unsecured debt, meaning you can pay it off faster.(4)

  • Buying something big. Be it your wedding reception, education for your children, or a once-in-a-lifetime holiday, a HELOC ensures you’ve got access to funds but are only paying interest on the amount you actually borrow.

  • Taking time off work. A HELOC gives you a chance to take a pause from work, so you can tackle new business opportunities or take care of your family.

  • Paying for emergencies. Many homeowners use HELOCs as a financial backup to preserve their retirement or long-term savings even when an emergency or unexpected event occurs.

With a HELOC, you can develop financial flexibility as well as resilience regardless of what comes your way.

Qualifying for a HELOC

It’s important to point out from the outset that you’ll need to have equity in your home to apply for a HELOC with Figure. Equity is the difference between the market value of your home and the outstanding balance of your remaining mortgage (plus any other loans you have taken out against your property). Your approved loan limit will depend on the amount of equity you have, as well as other factors such as your credit score. Eligible properties include single-family residences, townhouses, planned urban developments, and most condos.

Just like any other loan application, you’ll need to demonstrate your ability to repay with proof of employment, income, details of any existing debts as well as your credit history.

How to apply for a HELOC with Figure

Ready to apply for a HELOC and experience the Figure difference? Getting started is easy. Figure’s loan application is 100% online so you can complete the process in minutes.

Step 1: Tell us about you and your home.

We just need some basic details so we can find out who you are and what your finances look like. Things like your birth date, contact details, your residential address, financing purpose, salary, additional income, and so on. You can also create a login and password from the same registration page to keep track of your application.

When you submit these details, we’ll retrieve information from your personal credit profile from Experian for pre-qualification purposes. Don’t worry, this won’t affect your credit score.(5)

Step 2: Verify your information.

Next, we’ll ask for a few more specifics and confirm the details of your application. To determine the value of your property, Figure uses an Automated Valuation Model (AVM) that takes into account recent sales of similar properties, public data records, and historical price trends in the housing market.

You’ll also be asked to verify your identity, link your income sources, sign documents and talk to an eNotary.

Step 3: Get your money.

After your loan closes with the notary, the hard work is done and your loan will be funded and your line of credit will be ready for use.

With the entire process taking as little as five days, turning your home equity into funds you can count on is easy. Start your road to great credit with Figure today!

1 Approval may be granted in five minutes but is ultimately subject to verification of income and employment. 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. In addition, funding timelines may be longer if we cannot readily verify that your property is in at least average condition with no adverse external factors with a property condition report and need to order a desktop appraisal to confirm the value of your property.

2 You will be responsible for an origination fee of up to 4.99% of your initial draw, depending on the state in which your property is located and your credit profile. You may also be responsible for paying recording fees, which vary by county, as well as a subordination fee if you ever ask Figure to voluntarily change lien position.

3 You should consult a tax advisor regarding the deductibility of interest and charges to your Figure Home Equity Line.

4 The Figure Home Equity Line requires that you pledge your home as collateral, and you could lose your home if you fail to repay.

5 To check the rates and terms you qualify for, we will conduct a soft credit pull that will not affect your credit score. However, if you continue and submit an application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.

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