Better Home & Finance Holding Co

Better Home & Finance Holding Company operates as a technology-enabled homeownership company, offering mortgage, home equity, and other homeownership products through its digital platform, Tinman®. The company's services span the homeownership cycle, including purchase, ownership, refinance, and sale, and are provided to both consumers and third-party strategic partners. The homeownership experience is characterized by high transaction costs, regulatory complexity, and an intermediary stack, which Better Home & Finance aims to address through its technology-first approach.

The core business model revolves around generating revenue through the production and sale of loans and other product offerings via its platform. Revenue streams include gain on loans, net, other revenue (from Better Plus offerings and international lending), and net interest income. The company's primary customer segments are consumers seeking mortgage and home equity loans, as well as third-party strategic partners who integrate Tinman into their operations. The Tinman platform is central to the company's operations, enabling digital delivery, automation, and integration across its various activities.

The company's offerings are segmented into Home Finance, Tinman AI Platform, Better Plus, and International Lending & Services. Home Finance provides residential mortgage loan products for purchase and refinance, including cash-out refinance, debt consolidation, and home equity loans, covering GSE-conforming, FHA-insured, VA-guaranteed, and jumbo loans. Revenue is earned upon the sale of these loans to a network of purchasers. The Tinman AI Platform offers access to proprietary technology for mortgage origination activities, including underwriting, loan processing, compliance, and capital markets connectivity, with partners paying fees based on funded loans or Better Home & Finance originating loans directly for partners' customers. Better Plus complements mortgage products with non-mortgage homeownership services, such as real estate agent referrals, title insurance, settlement services, and homeowners insurance, for which the company acts as an agent or referral source and receives fees from third-party providers. International Lending & Services, primarily through its U.K. subsidiary Birmingham Bank, offers residential mortgage and related financial products in the United Kingdom, though the company is in the process of exiting non-core international operations.

For the fiscal year ended December 31, 2025, Better Home & Finance reported total net revenues of $164.872 million ¹, an increase from $108.488 million ² in the prior year. Gain on loans, net, which includes revenue from mortgage production, increased by $69.0 million ³ or 116% to $128.209 million ⁴ in 2025, up from $59.242 million ⁵ in 2024. Other revenue decreased by $1.589 million ⁶ or 12% to $11.299 million ⁷ in 2025, from $12.888 million ⁸ in 2024. Net interest income remained relatively stable at $17.425 million ⁹ in 2025, compared to $17.502 million ¹⁰ in 2024. The company recorded a net loss of $165.872 million ¹¹ for the year ended December 31, 2025, a 20% decrease from the net loss of $206.290 million ¹² in 2024. Basic and diluted EPS were both $(10.80) ¹³ for 2025, compared to $(13.65) ¹⁴ for 2024. Cash and cash equivalents decreased by $111.274 million ¹⁵ to $99.827 million ¹⁶ as of December 31, 2025, from $211.101 million ¹⁷ as of December 31, 2024. Total debt, including warehouse lines of credit and senior notes, was $610.664 million ¹⁸ as of December 31, 2025, compared to $763.819 million ¹⁹ as of December 31, 2024.

Year-over-year, Funded Loan Volume increased by approximately 32% to $4.744 billion ²⁰ in 2025 from $3.594 billion ²¹ in 2024. Refinance Loan Volume saw a significant increase of approximately 119% to $1.015 billion ²² in 2025 from $463 million ²³ in 2024. Purchase Loan Volume grew by approximately 8% to $2.875 billion ²⁴ in 2025 from $2.652 billion ²⁵ in 2024. HELOC Volume increased by approximately 78% to $854 million ²⁶ in 2025 from $479 million ²⁷ in 2024. D2C Loan Volume increased by approximately 14% to $2.928 billion ²⁸ in 2025 from $2.562 billion ²⁹ in 2024, while B2B Loan Volume decreased by approximately 91% to $95 million ³⁰ in 2025 from $1.032 billion ³¹ in 2024 due to the winding down of the Ally Partnership. Platform Loan Volume was $1.721 billion ³² in 2025, with no comparable figure for 2024 as it was consolidated from the previous Retail channel. Gain on Sale Margin increased by approximately 32% year-over-year to 2.87% ³³ in 2025 from 2.17% ³⁴ in 2024, driven by improved loan pricing and a higher mix of higher-margin products and channels.

Significant operational developments during the period include the winding down of non-core international operations, with the sale of Trussle Lab Ltd subsidiary completed in Q3 2025, resulting in a loss on disposal of $0.7 million ³⁵. The company also entered into a Note Exchange Agreement in April 2025, exchanging $532.5 million ³⁶ of Convertible Notes for $155.0 million ³⁷ in Senior Notes and a cash payment of $110.0 million ³⁸. An At-the-Market (ATM) Offering Program was implemented in September 2025, under which 547,260 ³⁹ shares of Class A common stock were sold for total gross proceeds of $29.8 million ⁴⁰. The company also increased its headcount, leading to a 23% increase in compensation and benefits expenses to $174.226 million ⁴¹ in 2025 from $141.089 million ⁴² in 2024.

Better Home & Finance aims to pursue profitable growth over the long term, though it does not expect to replicate the revenue growth rate and profitability experienced in 2020 and the first half of 2021. The company's ability to forecast future results is subject to uncertainties, including navigating regulatory and competitive environments, increasing customer numbers, and growing loan origination volumes.

The company seeks to expand its mortgage origination capabilities by diversifying its distribution channels beyond direct-to-consumer digital marketing. This includes focusing on partner relationships and locally oriented origination channels that emphasize referral- and relationship-based engagement, particularly for purchase transactions. The Tinman platform is leveraged to support these additional distribution channels by providing a centralized technology and fulfillment platform for consistent underwriting, processing, and operational execution. This multi-channel approach is intended to broaden reach, support purchase market growth, and enable scalable origination across a wider range of customer acquisition pathways.

Another key growth area is improving the conversion of prospective customers into funded loans through continued enhancements to operational efficiency, customer experience, and product offerings. The company is focused on supporting customers earlier in the homeownership journey through improved customer engagement and technology-enabled workflows. Further automation of the loan manufacturing process is aimed at reducing friction and processing time, which may support improved customer outcomes and conversion rates.

The company's technology strategy emphasizes fully automating manual aspects of the homeownership process to allow its team to focus on building customer relationships. Continued investment is planned to remove points of customer friction, making technology more efficient and scalable as new products are added, further driving down labor costs through automation. The company also sees growth opportunities in customer acquisition through data-driven marketing, including further penetrating existing and new performance marketing (pay-per-click) and digital media channels, as well as growing organic traffic and re-engaging existing customers.

The operational outlook includes a focus on expanding U.S. geographic and product coverage. The company plans to continue investing in infrastructure and compliance capabilities to broaden geographic coverage and expand its loan product offerings, including government-insured and non-agency products, as well as selected non-mortgage homeownership services, based on market demand. The company is also exploring additional third-party business process outsourcing relationships to provide additional capacity and enhanced disaster recovery capability, with an intention to scale its India-based team to leverage the large mortgage talent pool and favorable labor cost arbitrage.

Planned capital allocation includes using net proceeds from the ATM Program for general corporate purposes, including working capital and to increase warehouse line capacity to finance anticipated growth in loan production and funded loan volume. As of January 9, 2026, approximately $33.3 million ⁴³ remained available for issuance under the ATM Program. The company does not anticipate paying any cash dividends for the foreseeable future, with any future determination to pay dividends at the discretion of its Board, subject to compliance with applicable law and contractual provisions.

Management explicitly flagged several structural headwinds and execution risks to the growth plan. The business and results of operations are highly sensitive to interest rates and volatility, with elevated or volatile interest rates reducing housing affordability and refinancing incentives, suppressing origination volumes and increasing revenue volatility. The company's reliance on proprietary models and market data to manage risk means model limitations or failures could materially adversely affect the business. Dependence on a limited number of investors and GSEs for selling loans and MSRs poses a risk if this ability is impaired. The expansion into platform-based services for third-party originators may not be successful and could adversely affect results. The company also faces intense competition in highly competitive and fragmented markets, which could materially and adversely affect it if it cannot compete effectively or adapt to changes.

Geographic, regulatory, or macro factors identified as constraints include the heavily regulated nature of the industry, exposing the company to risks of noncompliance with complex and often inconsistent laws and regulations at federal, state, and local levels. The company's global operations in the United Kingdom and India subject it to operational challenges, laws, regulations, and political or economic risks. The geographic concentration of loan production, with approximately 34% ⁴⁴ of Funded Loan Volume in 2025 concentrated in California (approximately 17%) ⁴⁵, Texas (approximately 9%) ⁴⁶, and Florida (approximately 7%) ⁴⁷, makes the company vulnerable to adverse factors affecting these states.

The company faces material risks from its high sensitivity to interest rates and volatility, which can reduce mortgage origination demand and gain-on-sale margins. Operational risks include the potential loss of key leadership, a history of operating losses, and dependence on third-party vendors and a limited number of loan purchasers, including government-sponsored enterprises (GSEs). Compliance and risk management policies may not be sufficient to identify all financial, legal, and regulatory risks, potentially leading to substantial losses. The CEO's involvement in litigation could materially affect revenues and operations. Macroeconomic and U.S. residential real estate conditions, including interest rates, unemployment, and home prices, significantly impact loan origination. Disruptions in the secondary home loan market or changes in GSE requirements could impair the ability to sell loans. Technology disruptions, cybersecurity incidents, and issues related to the development and use of AI could harm the business. Debt obligations and reliance on warehouse lines of credit expose the company to interest rate risk and liquidity challenges, with an aggregate available amount of $575.0 million ⁴⁸ across three warehouse lines of credit as of December 31, 2025. The heavily regulated industry, including loan production, real estate brokerage, title, and insurance activities, exposes the company to noncompliance risks with complex and increasing federal, state, and local laws. Failure to obtain New York state regulatory approval for the Business Combination could restrict operations in New York, which comprised approximately 5% ⁴⁹ of Funded Loan Volume in 2023. Litigation and regulatory enforcement matters, including employee labor disputes with an estimated liability of $6.7 million ⁵⁰ as of December 31, 2025, and TRID defects with an estimated liability of $5.1 million ⁵¹ as of December 31, 2025, pose significant financial and reputational risks.

Management's message to shareholders emphasizes the company's mission to make homeownership better, faster, and cheaper through its technology-enabled digital platform, Tinman. They are focused on improving the platform and making investments for future growth, with the belief that success depends on driving customer traffic, converting leads, achieving operational leverage, and diversifying revenue through purchase loans and enhanced offerings. Strategic priorities include continued investment in technology to improve customer experience and reduce labor costs through automation, making the platform more efficient and scalable. They also aim to expand homeownership product offerings and efficiently acquire new customers across demographics, providing a high-touch personalized experience. The company intends to use net proceeds from the ATM Program, which had approximately $33.3 million ⁵² available for issuance as of January 9, 2026, for general corporate purposes, including working capital and increasing warehouse line capacity to finance anticipated growth in loan production and funded loan volume.