Transforming the Mortgage Process
It’s interesting how things can change. For a long time, navigating the mortgage landscape was a daunting task, riddled with lengthy procedures and mountains of paperwork. It often felt more like a labyrinth than a straightforward transaction, taking months to finalize.
Enter Figure, a fintech company based in New York, which went public in September. They’ve shifted the entire mortgage process on-chain, and that’s making things noticeably swifter and more cost-effective.
Now, mortgages can be created in just five days—not the usual 45—and the expense has plummeted from around $12,000 to about $1,000.
CEO Michael Tannenbaum emphasized the benefits of this technology, stating, “This is where blockchain really reduces costs and assists people. This is the future of capital markets.”
There’s a noticeable trend—whether in Washington or Wall Street—to transition outdated financial systems on-chain. Ownership is becoming clearer, more standardized, and easily transferable. While many companies are still finding their footing, Figure stands out. Since its inception in 2018, it has facilitated around $18 billion in mortgages and other real assets.
In fact, Figure represents about 75% of all loans recorded on the blockchain, which is part of an emerging market known as tokenization. Over 200 financial institutions, including major players like JPMorgan and Goldman Sachs, now utilize Figure’s framework for originating, registering, and trading loans, all of which receive top ratings from S&P and Moody’s.
Traditionally, each lender has its own processes, which means starting from scratch with every loan buy or sell. Figure simplifies all this by standardizing practices. Gone are the unique documentation requirements; all loans are generated using uniform data.
Utilizing AI, Figure can navigate complex documents like trusts and LLC agreements, extracting relevant information and recording it securely on-chain. Approved buyers can immediately access and confirm important details, eliminating the typically slow approval process.
With a standardized digital framework, Figure can efficiently direct loans through its own marketplace.
As Tannenbaum noted, “We have established a standardization of stock trading similar to how the New York Stock Exchange and Nasdaq have done.”
The public’s response has been quite positive. When Figure launched on the Nasdaq, its initial stock price was around $25, yet it saw an opening at nearly $36 and maintains a solid position.
In its first earnings report, Figure revealed a net revenue of $156 million for the quarter, alongside nearly $2.5 billion in consumer loan volume. They experienced over 200% growth in net income year-over-year.
Tannenbaum attributed some of this momentum to supportive policies from the current administration, such as the Genius Act proposal for stablecoins, which he believes reflects Washington’s growing confidence in blockchain as a legitimate financial infrastructure.
“Just a year ago, mentioning blockchain in a business meeting would draw laughs,” he remarked. “Now, if it’s not being discussed, that’s a major issue.”
This acceptance at institutional levels is influencing both Wall Street and everyday borrowers.
New tools like Intellidebt allow borrowers to alleviate burdensome high-interest credit card debts by converting them to home equity loans, typically at far lower rates. This transition can also lead to improvements in credit scores—sometimes by as much as 30 points.
When Tannenbaum took over as CEO in April 2024, he brought over ten years of experience from firms like SoFi and Brex, along with a keen curiosity that dated back to his student days during the 2008 financial crisis.
“I was drawn to Figure because I believe blockchain can tackle some of the issues we saw with loan ownership back then,” he reflected. “The dislocation presented a real opportunity.”
Home equity is merely a start. The same technology that optimizes mortgages is already being applied to a range of credit products, from auto loans to small business financing, with student loans in preliminary testing.
“We see the entire capital market, including private credit, as a space we can address with our technology,” Tannenbaum said. “This is an $180 billion market. We’re just beginning.”
