Home equity release firm Figure Technologies, Inc. has announced the rollout of a new sale leaseback product to offer prospective homeowners an option to access their home equity as an alternative to a reverse mortgage.
This new offering, Figure Home Advantage, works as follows: Figure purchases the home, and grants seller(s) a lease that renews annually. Homeowners then get the proceeds from the sale in one lump sum. As the new home-owning entity, Figure covers property taxes, homeowner’s insurance, and any other costs associated with ongoing maintenance of the property.
This offering features no age requirement or origination fees, with the costs built into the rent payments established by the lease agreement. Figure’s product page on its official website also states that the company requires a minimum credit score of 680, and advises that the financials work best for homeowners with mortgage debt between 0 and 30 percent.
With the official press release citing an Insured Research Institute (IRI) statistic that states only 25 percent of baby boomers believe they will have enough money in retirement, Figure CMO Wendy Harrington goes on to say that one of the purposes of the new product offering is to combat the rising interest rates currently associated with cash-out refinancing.
When RMD asked Figure about the maximum CLTV in this new offering, a company spokesperson said, “There is no set maximum allowable CLTV for the Home Advantage product,” before reiterating that the financials work best with a low percentage of existing mortgage debt.
Figure Home Advantage is currently available in 12 markets: Atlanta, GA; Cincinnati, OH; Cleveland, OH; Dallas, TX; Houston, TX; Jacksonville, FL; Philadelphia, PA; Phoenix, AZ; Pittsburgh, PA; Reno, NV; San Antonio, TX; and Tampa, FL. The company plans to expand to 40 additional markets by the end of 2019. This is the latest in a host of tools recently made available to the market, designed to help homeowners unlock their home equity.
Written by Chris Clow