Hi All,
This is a comprehensive write-up of my findings/experience with Figure.com aka Figure (Figure Lending, LLC). They are an online-only lending platform doing home equity line of credit, mortgage refinances, and personal loans. I didn’t see extensive information on Figure in my research so figured I’d contribute by sharing my experiences/data on their original product (of which I am I now a customer) – a HELOC.
Key Features:
Soft-pull Rate Check of Experian (actual APR – not ballpark)
Online verification of necessary stated income PRIOR to Hard Pull (HUGE benefit IMO)
Fixed Rate HELOC – 5, 10, 30 year loan terms
No appraisal needed – AVM property valuation report before Hard Pull using CoreLogic PASS
Can utilize assets (that you must electronically verify) to increase eligible loan amounts
Fast Closing & Funding – once 5 minute E-Notary session completed, funds were in my bank account first business day following the rescission period
Fast, online application w/ user-selectable amounts/terms/options
6am-6pm PST phone support (9am-9pm EST) open everyday
Additional draws of $500 min., subject to present interest rate
*Unanticipated Bonus* - Loan was funded with no Hard Pull
Requirements:
Experian FICO v9 of 620 or above
Up to 50% debt-to-income (hard cut-off)
Up to 95% CLTV per schedule located: https://www.figure.com/faqs/home-equity-line/
$15,000-$250,000 loan amounts available based on credit score
No Appraisal feature doesn’t apply for largest loans/CLTV (I think $150,000 is the documentation cut-off)
Details:
Because it’s an online-only lender, they currently only allow one (and they mean it) document to be manually reviewed. I did not want to link my checking account, so I gave them my paystub.
However, the most annoying part of their process is their income verification rules:
- They only consider paystub details for compensation during THAT period. However if you are using bonus income and it wasn’t paid on that ONE paystub they will review, you are stuck. My paystub even showed “YTD Bonus” on the paystub and they could not include that. This is incredibly dumb of course (although I know why this is done)
- I hesitated to link my checking account, and tried using Workday account linking, but their system could not get through my company’s 2-factor authentication
- Eventually after doing more research on their 3rd-party income verifier (Plaid) I decided to link my checking account, which worked.
- HOWEVER, I was told by multiple people that the checking account linking to verify income looks at your deposits from the past 85 days. Luckily, when I learned this I was 80 days out from my bonus being deposited, so I was in the clear. This sounds incredibly ridiculous but then again just 70 days ago my promotion and raise starting hitting my account, so if they were to look back longer I suppose that could be a drawback if your income has gone up significantly recently. Figure needs to solve this issue it should be smart enough to verify what you’ve stated or ask for more documentation.
- Using the checking account linking, obviously it’s seeing after-tax after-payroll deduction compensation. I have significant deductions for pre-tax parking, 401-k, healthcare plan, and HSA, so I was concerned it would not accurately account for my income. Turns out that was not the case – once I linked my checking I was fully verified.
Side note: I wonder if I was less scrupulous, given the apparent simplicity of their model and that my bonus could be mistaken as regular income, whether I could’ve entered a much higher income and it would accept it. Of course I didn’t try that, but given I actually DO have higher income it’s just not regular/historically provable I am admittedly curious.
As noted above, once you enter your income and are presented with options (post soft pull), there is an option at the top of the page where you can enter financial assets to increase your maximum loan amount.
Example of loan amount change due to assets:
Due to 2 credit cards with large balances having just gone off 0% interest (stupid of me not to have done it before since both were getting paid to $0 w/ the HELOC), the minimum payment jumped over 50% once they reported, so I was bumping up against 50% DTI limit on loan amount relative to easily provable personal income (whole idea of using Figure is funding speed/simplicity/transparency).
Upon entering $61,000 in 401k assets, my max loan amount was increased by 53% ($14,599). Keep in mind my post-loan CLTV was 63.5% however.
Funding and Initial Credit Bureau Reporting:
There is a 3-day recission period as required by law following completion of the e-notary session; that period ended on a Friday evening with Monday being a holiday. By Wednesday morning (2 full business days later) I had the funds in my checking account. That is as fast as advertised!
For anyone tightly engineering your reports or applications and want information on how quickly the HELOC gets reported to the bureaus, my loan disbursed and was available to me on the 2nd and was reported to all 3 bureaus by the 18th (earliest date could’ve been the 16th). When it reported, the balance was slightly above the total limit due to accrued interest, but that doesn’t appear to have caused any issues.
This was a particular concern for me because I was paying off large balances and didn’t want to trigger adverse action with a huge new credit line with a balance over the limit, considering my total credit usage would be lower than it was originally once everything was paid off and reported.
HELOC Trade line details:
The new HELOC account appears to have cleared the balance hurdle for separate scoring treatment from credit cards (although it’s still technically revolving credit of course). This is the case for every one of the >30 credit score versions I have access to currently. So there is a data point for everyone - $41,928 cleared the hurdle. I say that because if it hadn’t, my scores should’ve been flat or nominally down (at least for the first few months with a new account) – all my scores are up over 20.
My biggest fear was how the new HELOC account would be accounted for in scoring – if this account got treated as a massive new credit card for scoring purposes, which,
Very short term, I was also afraid the big new balance could draw the attention of risk management algorithms, particularly if it didn’t meet the nebulous balance threshold for special treatment vs. regular revolving balances like my other cards. The worst-case scenario would be HELOC showing up before I paid off those two cards, especially without the adjusted scoring treatment, which would make me look particularly risky for a very brief period.
I tried to time the HELOC application so those cards would report shortly after I paid them off. I ended up getting AMEX to update my account balance mid-cycle so that eliminated over half the problem. Now everything is reporting, and I think I’m in the clear from AA risk. I’m actually getting all kinds of new offers as my Vantage scores are up 53 points and FICO 8 & v9 have risen 27 & 37.
Overall impression:
I was overall quite pleased with Figure Lending and recommend them to others. They may or may not give you a quality rate, but the fact that you can verify essentially ALL of the loan application details and pass automated underwriting prior to approval means you take essentially no risk in checking what loan rates they will offer you. Hope this helps!
