Figure targets Fannie Mae and Freddie Mac in mortgage push, citing massive cost cuts for borrowers
The firm offers rapid service, targeting the sub-$300,000 loan segment, with HELOC applications approved in 5 minutes and funding in 3 days.
What to know:
- Figure is challenging U.S. giants Fannie Mae and Freddie Mac in the first-lien mortgage market by using its blockchain platform to cut origination costs by 91%.
- The firm offers rapid service, with HELOC applications approved in 5 minutes and funding in 3 days, targeting the sub-$300,000 loan segment.
- Figure is pivoting to a marketplace model, projecting adjusted EBITDA margins of 80–85% as it negotiates DeFi protocol integration with ConsenSys’ MetaMask.
The pitch combines cost and speed. Figure says HELOC applications get approved in 5 minutes and loans fund in 3 days, against an industry norm of 30-45 days.
The platform also gives originators a guaranteed buyer for the loans they make, the same role Fannie and Freddie play in the traditional system.
The first-lien market is 25 times larger than Figure’s existing second-lien HELOC business, which runs through 308 partner originators according to Cagney.
Cagney said the sub-$300,000 segment is the target because the fee structure that supports smaller GSE-channel loans does not work at Fannie and Freddie’s cost levels.
Cagney also said Figure’s HELOC tokens are the ninth-largest crypto asset on public blockchain by market value, passing roughly six weeks ago.
