Fintech lender Figure Technologies is going full force in to the mortgage lending – and now servicing – blockchain revolution. Just one week after its announcement that it would merge with lender Homebridge Financial Services, the company revealed a partnership with loan servicing software developer Sagent.
According to the Tuesday press release, Sagent will power Figure’s mortgage servicing to grow out its blockchain development. The partnership will also allow for borrowers to manage to their loan lifecycle through their mobile devices on Sagent’s performing, non-performing and consumer platforms.
“We’ll also begin bringing scale mortgage assets onto the Provenance Blockchain to reduce mortgage industry costs by up to 100 basis points from origination through securitization,” said Mike Cagney, Figure’s co-founder and CEO.
The fintech lender has been on a technology overhaul in recent months, having snagged a $200 million Series D round just two weeks ago. Investors and affiliates of the round, including Apollo Global Management, Inc., Blockchain.com and Rockaway Blockchain among others helped boost Figure to an approximate $3.2 billion valuation.
For investors, the advantage of blockchain is accuracy; the odds of having defects in the loan are lower simply because fewer inputs along the way are coupled with transparency in the process. Not to mention, the cost of producing that loan has been proven to be cheaper.
At the time of the funding round, Mike Cagney noted, “This investment is going to give us the resources we need to further fuel our mission of leveraging blockchain to reinvent the financial services industry.”
Cagney, who founded and led student loan lender SoFi, has been outspoken about his goal to purchase one or two mortgage lenders for Figure and test the blockchain platform at scale. As a technology vendor, Cagney explained at HousingWire‘s Spring Summit in March that it’s hard to get the attention of mortgage producers because they’re either booming or busting.
“I’d just rather have direct control of it,” Cagney said. “We already have our own mortgage origination business that’s growing pretty rapidly right now. But we’re going to do some acquisitions for scale. We have a SPAC that was just launched that may also be doing some acquisitions within the mortgage vertical. Not necessarily. But, I would expect you to see at least one major transaction from us this year.”
Aside from Figure’s recent acquisition and partnership, the company hinted that these were just the “first in a series of Figure mortgage growth moves.”
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