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Figure Review of the credit line with mortgage guarantee (HELOC) 2020

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If you are currently seeking financing, it may be worth looking a little closer to home. In the form of a credit line on the net value of the home (HELOC), you have the opportunity to obtain financing by freeing part of the capital accumulated on your property.

The amount you can get will depend on a number of factors, particularly the market value of your home and the amount of money you have left to pay your mortgage.

One of those suppliers that is looking to take advantage of the housing capital market is Figure. The recently launched FinTech platform claims to offer super-fast housing capital lines in a matter of days, up to 95% of the value of your home.

If you want to find out if Figure is right for you or not, be sure to read our full review. We have covered all the fine points, such as how the home equity line process works, how much you are likely to get, if the loan is profitable and anything else we think you should know before applying.

Let's start by quickly discovering what a figure is.

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What is the figure?

Recently launched in 2018, Figure is an online FinTech platform that specializes in consumer financing. While the company's distinctive offer is the line of credit on the net value of the home, Figure also participates in a number of other financial products, such as reverse mortgages.

One of the outstanding features of Figure is that the company is a pioneer in innovative financial technologies. By using blockchain and artificial intelligence within their decision-making portal, customers can often receive a decision in minutes.

These technologies also allow the company to obtain and verify your personal information quickly and safely, subsequently protecting your confidential data along the way.

Figure website

In terms of the housing capital line offer, the California-based company aims to attract a large demographic in the United States. For example, loans vary from $ 15,000 to $ 150,000, and their loan terms are as short as 5 years, up to a maximum of 30 years.

In addition, Figure is also part of the "Soft Credit Check Club", which means you have the opportunity to evaluate your eligibility and loan rates without being marked on your credit report.

So, now that you know what the company is doing, let's take a closer look at your home equity loan service, starting with eligibility.

Who is eligible for a home equity line of credit?

While eligibility will ultimately depend on a number of factors, such as your creditworthiness and your current relationship with debt, let's start with the basics.

As the name implies, you must obviously own a home and, therefore, your name must be registered in the county records. Next, you should also ensure that Figure home equity loans are available in your respective state. At the time of writing this article, 37 states are covered, plus the District of Columbia.

In terms of your creditworthiness, you will need to have an FICO credit score of at least 600. The lender also takes your debt-to-income ratio in consideration. For those who do not know, this is the amount of debt you currently have, in relation to your income. To qualify, you cannot have a debt-to-income ratio that exceeds 50%.

HELOC

In terms of the property itself, your home must be a single-family residence or a terraced house. As such, condos and mobile homes are not covered. You must also show proof that you have risk insurance and, depending on your location, flood insurance.

If you are not 100% sure whether or not you meet the requirements listed above, then the good news for you is that Figure allows you to make a software application.

In simple terms, this means that by entering your details and requesting a home equity loan, you can see if you qualify or not without the application appearing on your credit report.

In this sense, you have nothing to lose with the application, since even if you are preapproved for a home equity loan, you have no obligation to continue.

Now that we have covered the lender's eligibility requirements, in the next section we will explore the size and duration of the loans that Figure offers.

Size and duration of the figure Household equity line

First, the Figure facilitates the equity lines of housing ranging from $ 15,000 to $ 150,000. The amount you can get, of course, will depend on your current financial circumstances.

In particular, this will include the amount of capital you currently own on your property.

The figure allows a loan-to-value ratio (LTV) of up to 95%. In order to calculate Your current LTV must evaluate the current market value of your property against the size of the pending mortgage.

For example, if the value of your property is $ 250,000, and you currently have $ 100,000 left to pay your mortgage, then your LTV would be 40%. In this sense, the lower the LTV ratio, the more capital it will have available to release. It is also worth noting that you will still qualify for a home equity loan Figure even if your property has been paid in full.

In terms of assessing how much your property is currently worth, Figure uses an Automated Valuation Model (AVM). In a nutshell, this follows a similar principle to a Comparative Market Analysis. As such, the lender will seek to explore similar-sized homes that have recently sold in their neighborhood, along with historical price trends in their local housing market.

When it comes to the duration of the home equity loan, the Figure offers loan terms of 5, 10, 15 and 30 years. It is a strange thing that the lender does not allow you to choose a loan term outside these perimeters.

How does it work

Financing costs and other fees

It is important to remember that although you are freeing up capital in your home, you are still getting financing in the same way you would with a conventional bank loan. As such, you should evaluate how much the home equity loan will cost you during the term of the agreement.

Origination Rate

First, although Figure states that it does not charge any maintenance or account opening fees, it will still have to pay an opening fee. This is typical in the financing scene, and you are charged to cover the costs of the loan organization.

Although the amount you pay will vary depending on a number of factors, the charge has a limit of 4.99%. If you end up paying the highest amount, this can end up being quite expensive.

For example, if I had to get a $ 100,000 home equity loan, I would pay a whopping $ 4,990 in fees. Since origination fees are subtracted from the amount borrowed, in this example you would receive $ 95,010.

APR financing

In addition to the home rate, of course, you should consider the actual annual percentage rate charged on your home equity loan. As in the case of the origin rate, the amount you pay will be based on your financial circumstances.

In the Figure, this will range between 4.99% and 13.74%.

Whether this is a good value or not, it will depend on the rate you actually get. As a pointer, it is worth considering that at the time of writing, the average The home equity loan costs 7.40% in the United States. As such, if you can get less than this, you are likely to get a good deal.

The only way to evaluate what you will end up paying is by requesting prequalification. That way, you can assess how much the home equity loan will cost without affecting your FICO credit score.

How does the loan process work in the figure?

Since Figure is a lender only online, you can complete the entire loan application process from the comfort of your home or through your mobile device.

This is what you should do.

  1. Once you are on the Figure home page, look for the "Search my rate" button.
  2. Next, you must enter certain personal information. This will include your full name, address, date of birth, social security number and telephone number, followed by some questions about your current financial circumstances.
  3. Expect to tell the platform about your current assets, income and debt relationship.
  4. You must also upload some identification to prove who you are, so have a copy of your passport or driver's license handy.

Since the entire application process is automated, you must receive an instant prior approval decision. Again, this highlights the benefits of using innovative technologies such as blockchain and artificial intelligence.

Apply

This will describe how much you can borrow, along with the APR rate and the home rate. In fact, they are likely to offer you an amount of APR fees, depending on the duration of the term you want.

Once you have evaluated the rates offered and decide that you want to continue with the home equity loan, you will be connected to an "eNotary". The purpose of this is to further verify your documents and, therefore, obtain them officially notarized. In addition to your government-issued identification, you must also validate your mortgage documents, deeds and proof of insurance.

On the one hand, it is excellent that you can facilitate the entire process of home equity loans in a matter of minutes. This is really the future of financing at its best.

However, it is absolutely essential that you do not rush into the application without taking time to consider all the basics. It is effectively entering into a legal loan agreement, which, if it is not right for you, could cause financial complications later.

However, Figure states that, on average, you should receive your funds within 5 days after the approval of your application.

Figure Customer service and comments

Since Figure is an online only platform, you should remember that you will not have the opportunity to meet with an advisor in person.

If you need help, you have several options to choose from.

The support team works from Monday to Saturday, between 6 a.m. and 6 p.m. Pacific time. The easiest way to make contact is through the live chat of the platform.

Alternatively, you may consider calling the customer service team directly, which you can do at 888-819-6388.

If your inquiry line is out of business hours, you can send an email to the support team at help@figure.com.

As is a common practice in MoneyCheck, we evaluate the TrustPilot score currently held by the Figure. At the time of writing, the platform has an "Excellent" TrustPilot score of 9.5 / 10. However, this is only in 273 individual reviewers so far, so the score should be taken with caution.

Figure revisions

Figure Review of the household equity line: the verdict?

In summary, the Figura platform again shows us how far modern financing has come. In a matter of minutes, you can request a HELOC without talking to a real-world human. Instead, the platform is based on innovative technologies such as blockchain and artificial intelligence.

With a minimum FICO credit score of 600, and a maximum LTV rate of 95%, home equity loans in the Figure are extremely inclusive. In addition, with APR rates that start at just 4.99%, the loans are of very good value if you can get financing in and around this figure.

Despite its convenient, fast and super easy to use offer, the only complaint we have with Figure is its original rate. With a maximum home rate of 4.99%, this could be very expensive in the long term, especially if the amount of your home equity loan is a sum of six figures.

However, the best thing about the application process in Figure is that you can evaluate your financing rates without this having an impact on your credit score. As such, you have nothing to lose by spending the few minutes necessary to complete the prior approval request.

Visit figure

Figure

Figure

Pros

  • Good interest rates
  • Quick approvals and financing
  • Low rates

Cons

  • HELOC only
  • Not all properties are eligible
  • Condos and mobile homes not covered

one

Disclaimer: The opinions expressed herein are only those of the author, not those of any bank or credit card issuer and have not been reviewed, approved or endorsed by any of these entities.

Disclaimer: The answers below are not provided or commissioned by the bank advertiser. The responses have not been reviewed, approved or supported by the bank advertiser. It is not the responsibility of the bank advertiser to ensure that all publications and / or questions are answered.

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