Better Home & Finance Holding Company says founder and former CEO Vishal Garg does not have enough shareholder support to remove a majority of its directors, escalating a leadership fight that has moved from dueling press releases into a formal battle for shareholder votes.
The digital mortgage lender called on Garg Monday to end what it described as a “revenge campaign” to replace the board, reverse his removal as CEO, and return to an executive position.
“Despite this improper and unlawful solicitation, Mr. Garg does not have the votes required to implement his boardroom coup — even including the substantial voting power associated with his own super-voting Class B shares,” Better said.
The company did not disclose how many shareholders Garg has solicited, the voting power currently supporting him, or the threshold it used to conclude that his effort had failed. Better’s allegations that Garg violated federal securities laws also have not been adjudicated.
Garg previously claimed he had signed declarations from shareholders representing a majority of Better’s voting power. He offered to show the declarations to the company’s attorneys on an attorneys’-eyes-only basis, but they have not been made public.
That leaves the central question in the fight unresolved: Who actually has the votes?
SEC Filing Shows Garg Has Allies
A recent securities filing provides evidence that Garg is not acting alone, but it does not establish that he controls a voting majority.
An amended Schedule 13D filed with the Securities and Exchange Commission by entities affiliated with Activant Capital founder Steven Sarracino states that Sarracino, Garg, and investor Tony Bobulinski have discussed, and expect to continue discussing, changes to Better’s board and its interim or permanent CEO.
The filing says the investors could be deemed a group beneficially owning approximately 4.54 million shares, or 26.8% of Better’s outstanding common shares. The reporting parties expressly disclaimed that they had formally created a group and disclaimed ownership of shares held by the other parties.
The 26.8% figure also does not answer the voting-control question. Better has a dual-class structure in which each Class A share receives one vote and each Class B share receives three votes. Garg and some of the investors aligned with him hold Class B shares, making their percentage of voting power higher than their percentage of outstanding shares.
At Better’s June annual meeting, 13.08 million Class A shares and 4.35 million Class B shares were eligible to vote, according to the company’s 2026 proxy statement. The current totals could differ because of subsequent issuances, conversions, or other transactions.
Better’s assertion that Garg lacks sufficient support therefore may be based on more recent shareholder communications than the public filings reveal. The company did not provide the underlying tally.
From “Mutual” Departure To Removal
Better’s description of Garg’s exit also has sharpened since it first announced the leadership change.
On Aug. 3, Better said Garg had “mutually agreed” with the board to step down as CEO. Garg remained a director, while Daniel Lewis was appointed interim CEO.
In Monday’s statement, Better said the board unanimously voted to remove Garg as CEO, with Garg not participating in the decision. The company said Garg initially accepted the outcome and “willingly stepped down” before seeking to reverse it.
That distinction is now central to the dispute. Garg has portrayed the board’s actions as destructive to shareholder value and has demanded that five directors resign. His proposed plan included installing a reconstituted board, conducting a new CEO search, repurchasing as much as $30 million of Better stock, continuing the company’s AI-driven cost reductions, and selling its U.K. banking operation. Garg said he would work for a $1 salary until Better achieved profitability.
Better contends the plan is an attempt to restore Garg to power after independent directors concluded he was “unfit” to lead the company.
Better Raises New Confidentiality Allegation
The company also accused Garg of disclosing confidential information that created risk for Better’s “plans, business relationships and key strategic initiatives.”
Better did not identify the information allegedly disclosed, the recipient, or the specific business initiative it says was placed at risk.
The allegation adds another possible legal front to an already contentious dispute. Better previously accused Garg of delaying its second-quarter Form 10-Q by refusing to execute required representation letters unless the company granted concessions. Garg disputed the board’s account and filed suit challenging actions taken around his removal.
Better said Monday that Garg also misrepresented facts while soliciting shareholders and violated federal securities laws. No regulator or court has determined that Garg’s shareholder communications were unlawful.
The company said it plans to file a preliminary consent revocation statement with the SEC and send shareholders a white consent-revocation card opposing Garg’s attempt to remove directors. Garg’s group would generally need to make its own required filings as part of a formal consent solicitation.
Until those materials appear, shareholders have only the two sides’ competing claims about the vote count.
Financial Turnaround Meets Boardroom Fight
The leadership battle arrives while Better is still trying to convert higher production into sustainable profitability.
Better originated $1.67 billion in loans during the second quarter, up 38% from a year earlier, while revenue increased 28% to $54.7 million. The company nevertheless reported a $30.6 million net loss and a $14 million adjusted EBITDA loss.
Its adjusted EBITDA result included a $6.5 million benefit from a change in its reserve for potential Truth in Lending Act and Real Estate Settlement Procedures Act liabilities. Without that benefit, the operating picture would have been weaker.
Lewis also acknowledged that Better would not meet its previous target of reaching adjusted EBITDA break-even in September. The company now projects a third-quarter adjusted EBITDA loss of $15 million to $18 million on funded loan volume of $1.375 billion to $1.525 billion.
Better said Garg’s tenure since 2022 produced more than $1.5 billion in cumulative losses and a decline of more than 90% in its publicly traded shares. Those figures cover a severe mortgage-market contraction as well as company-specific operating and governance problems.
The company also invoked findings from Garg’s previous business disputes, including a jury verdict that found him liable for breach of fiduciary duty and conversion. Better characterized conversion as “a form of theft,” although conversion is a civil claim involving wrongful control over another party’s property and is not, by itself, a criminal theft conviction.
Garg’s attorney did not immediately respond to a request for comment on Better’s latest statement and its assertion that he lacks the votes.
Better told shareholders they do not need to take action yet. That may be the most important word in the statement: yet.
The board says the attempted comeback is already futile. Garg says the shareholder math is already on his side. The next SEC filings should finally force both sides to show more of their work.
