Figure Technology Solutions said mortgage partners using its platform generated substantially more home equity lending volume than their previous production would have predicted, adding an originator-level measure to a quarter marked by rapid marketplace growth and record profitability.
Figure estimates that 185 partners with eligible 2025 Home Mortgage Disclosure Act data originated approximately 2.6 times the HELOC volume predicted by their pre-Figure production baseline. The company calls the increase the “Figure Factor.”
Figure developed the comparison by taking each partner’s HELOC activity before joining its platform and increasing that baseline by the 5.7% growth recorded across the non-Figure subordinate-lien market from 2022 through 2025. The result is Figure’s internal analysis and does not independently establish that its platform caused the additional production.
“What these partners would have produced had they continued at their prior trajectory,” Figure CEO Michael Tannenbaum said during the company’s second-quarter earnings call Thursday. “The result, our partners originated 2.6x more HELOC volume in 2025 than their pre-Figure baseline would predict.”
The analysis gives mortgage companies a more concrete measure of Figure’s pitch: Its value is not limited to automating HELOC production. The company is attempting to connect originators with more capital, improve execution as marketplace volume grows, and make home equity lending economically viable for more institutions.
Figure’s Consumer Loan Marketplace handled $4.26 billion in the second quarter, up 132% from $1.84 billion a year earlier and 47% from $2.9 billion in the first quarter. Volume finished approximately 4% above the top of Figure’s guidance.
The total should not be read as Figure-funded HELOC originations. The company defines Consumer Loan Marketplace volume as HELOC, debt service coverage ratio, and personal-loan originations completed through its loan origination system, together with third-party loans traded through Figure Connect.
More Volume Moves Off Balance Sheet
Figure Connect accounted for $2.77 billion, or 65%, of second-quarter marketplace volume. That was up from 56% in the first quarter and 42% a year earlier.
Launched in June 2024, Figure Connect provides a marketplace through which originators can sell loans to institutional buyers, including asset managers, insurers, and credit funds. Figure said its largest new partners are increasingly moving directly onto Connect rather than first using Figure as an intermediary.
“This is very material growth, especially considering that aggregate volume is growing 130% plus,” Tannenbaum said. “As a result, more of our growing volumes are generated off balance sheet.”
Figure ended the quarter with 489 active partners across independent mortgage banks, servicers, depositories, fintechs, and other lending businesses, an increase of 102 from the first quarter. Tannenbaum said one new partner moved directly onto Connect and has already become Figure’s largest or second-largest partner, depending on the month.
Existing partners are producing more as well. Figure attributed 40% of its Connect volume growth to companies that had been on the platform for more than a year. Tannenbaum cited New American Funding, which moved onto Figure Connect in early April and, according to Figure, increased its volume on the platform by 80% from the first quarter.
Figure also said partner-branded production represented 83% of total marketplace volume during the quarter.
Lower Take Rate, Higher Margin
The migration to Figure Connect is changing the economics underneath Figure’s growth.
Figure reported $225.6 million in GAAP net revenue, up 113% year over year, while net income nearly tripled to $87.4 million from $30 million. Adjusted net revenue increased 95% to $218.4 million, and adjusted EBITDA rose 126% to $119.4 million.
Its adjusted EBITDA margin reached 54.6%, rounded to 55% in the company’s earnings presentation, compared with 47.2% one year earlier. Ecosystem and technology fees rose 159% to $72.9 million and became Figure’s largest adjusted revenue line for the first time.
But Figure’s net take rate declined to 3.6% from 4% a year ago. Management attributed the decline to the growing share of lower-priced Figure Connect volume, rising interest rates that reduced gain-on-sale revenue, and growth in first-lien loans, which generally carry a lower take rate.
Figure Connect produces less revenue for each dollar passing through the marketplace, but it requires less balance-sheet capital and carries a strong contribution margin. Figure said the mix shift is moving it toward a medium-term adjusted EBITDA margin target of 60%.
“Each point of mix shift to Connect reduces balance sheet usage, increases fee-based economics, and builds towards our medium-term 60% EBITDA margin goal,” Tannenbaum said.
He said the lower take rate did not result from renegotiated pricing or pressure from partners. Tannenbaum said Figure had not renegotiated its pricing tiers, although partners pay lower rates when they reach higher-volume thresholds established in their agreements.
“We’re not renegotiating our volume tiers with partners,” Tannenbaum said. “But when we sign up partners, we establish volume-based pricing that comes down to incentivize partners to do volume with us.”
Figure expects its take rate to remain near the bottom of its previously disclosed 3.5% to 4% range during the third quarter.
For mortgage executives, the trade-off is central to Figure’s strategy: The company is accepting a smaller percentage of revenue on marketplace volume while using Connect to move more loans without taking the same balance-sheet exposure. So far, volume growth and operating leverage have more than offset the lower take rate.
Home Equity Demand Broadens
Figure said borrowers are increasingly using home equity to consolidate higher-rate consumer debt. That use has increased by 4 percentage points as a share of Figure’s year-to-date volume, according to Tannenbaum.
The company is also pushing home equity products into small-business finance and home improvement. Those two channels reached a combined $470 million annualized volume run rate in June, while small-business volume grew 57% from the first quarter.
Tannenbaum said the strategy is bringing companies into home equity lending that historically did not operate in the mortgage market, including business-loan originators, brokers, and fintechs.
“They’re able to use Figure because we make it so simple and easy and inexpensive,” he said. “That’s a big part of our broader strategy, to take partners that normally wouldn’t be in this space and give them tooling to join our platform.”
Management said credit quality has remained strong as HELOC activity has increased. Figure’s earnings presentation showed a weighted average FICO score of 748 for second-quarter originations, up from 742 a year earlier, while the weighted average combined loan-to-value ratio declined to 69% from 71%. The company reported a 60-day delinquency rate of 0.6%.
Kiavi Will Add Investor Lending
Figure’s next major expansion is expected to come through its pending acquisition of Kiavi, the residential real estate investor lender specializing in residential transition and DSCR loans.
Figure agreed in June to acquire Kiavi in a $717 million transaction expected to add more than $7 billion in annual first-lien volume to Figure Connect.
Figure said the transaction remains on track to close before the end of 2026, subject to regulatory approvals and customary closing conditions. Figure expects Kiavi to add approximately 40% to its marketplace volume and contribute about $100 million in annual EBITDA.
Tannenbaum said Figure intends to use Kiavi’s post-renovation home valuation technology to develop greater standardization and liquidity in residential transition lending.
“The residential transition loans are not agency eligible,” Tannenbaum said. “We can use their market-leading technology to develop liquidity and standardization for the space.”
Figure projects Consumer Loan Marketplace volume of $4.8 billion to $5.2 billion for the third quarter. Chief Financial Officer Macrina Kgil said July volume reached $1.7 billion, giving the company confidence in the approximately $5 billion midpoint of its forecast.
The second-quarter numbers show that Figure Connect is already changing the company’s own economics. The Kiavi integration will test whether the same marketplace model can change the economics of a second major mortgage asset class.
