Digital lender Better.com launched its One Day Home Equity Line of Credit (HELOC) product that will provide approval decisions to consumers within 24 hours of locking their interest rate.
Better launched its first HELOC product about a year ago. The One Day HELOC product is the latest upgraded version as the New York-headquartered lender looks to ramp up speed for customers seeking to access home equity funds.
“When we talk about the alternatives to a HELOC, consumers are frequently taking out credit cards or personal installment loans, and both of those products are expensive for anyone who has home equity … yet people still take those out, even though they have home equity, because they’re fast,” Better CEO Vishal Garg said in an interview with HousingWire.
“So, we said, what if we could do a HELOC at the same time that it takes you to get a personal installment loan or a credit card?”
Getting an approval decision for a HELOC generally takes about three to five days through a digital lender but multiple weeks from banks, Garg noted.
Qualified homeowners must provide required documents — including pay stubs, W-2 forms, mortgage statements and bank statements — within four hours of locking the rate for their first- or second-lien HELOC with Better Mortgage, the company stated.
Available in 49 states and Washington, D.C., the One Day HELOC is limited to a borrower’s primary residence or second home, as well as single-family homes, condominiums and townhouses that are classified as investment properties.
Better rolled out a One Day Mortgage product in January 2023 that allows customers to apply for a mortgage, get preapproved, lock their rate and receive a commitment letter within 24 hours.
“The demand has been crazy — over 80% of our mortgages today are One Day Mortgages,” said Garg, without mentioning origination volume.
Founded in 2014 by Garg, Better went public in August 2023 through a merger with special purpose acquisition company (SPAC) Aurora Acquisition Corp., nearly two years after Better’s initial timeline for an IPO.
In its first earnings report since going public, Better Home & Finance Holding, the parent of digital lender Better.com, reported a GAAP net loss of $340 million in Q3 2023.
Executives shared plans to trim expenses and expected a funded loan volume of $500 million in the fourth quarter of 2023.
The New York-headquartered lender is expected to report its earnings for Q4 2023 on March 28.
Better ranked as the 64th-largest lender in the country, originating $2.5 billion in the first nine months of 2023, according to Inside Mortgage Finance.
