“Due to closing delays associated with continued momentum in other parts of our lending, payments and market businesses, we have concluded with the Homebridge team that the merger will not proceed. “Cagney said in a Friday night message to Figure’s. crew.
A spokesperson for Figure said the company had no additional comments beyond those posted on its website. Homebridge did not return a request for comment.
The companies will maintain an ongoing strategic partnership, collaborating to advance Figure’s proprietary platform, called Provenance Blockchain, Cagney said in the post.
They will also work together to develop new products, such as a home equity line of credit (HELOC) and piggyback products. “We will work closely with Homebridge to identify and deploy new applications, including a white label version of the HELOC product for the wholesale market,” Cagney said. “Homebridge will pursue integration plans with DART, our blockchain-based mortgage registry and eNote.”
HousingWire reported in March that the delay in approving the deal was changing Figure’s strategy. In early April, the company launched a 30-year fixed-rate cryptocurrency-backed mortgage product for borrowers to use bitcoin and/or ether as collateral.
The plan was to launch such a product only after closing the merger with Homebridge, but circumstances changed due to delays in closing the deal.
Additionally, two other companies have announced the product since December, including Miami-based digital lender Milo and Toronto-based cryptocurrency lending platform ledn.
Cagney said it’s realistic to expect Figure to reach between $500 million and $1 billion in origination volume in 2022. Figure will use its own cash to originate up to $100 million in loans. And while Figure does not intend to raise capital for the product, it may tap into other sources of funding if needed.
By CrunchbaseFigure raised $1.6 billion in venture capital, including a $200 million Series D funding round in May with 10T Holdings and Morgan Creek Digital, as well as a $100 million funding facility from of JPMorgan Chase in January 2021.
By merging with Homebridge, Figure planned to partner with a lender that competes across multiple channels. According Inside Mortgage FinancingHomebridge was the 36th largest mortgage originator in 2021, originating about $23.5 billion in mortgages, down 11% from 2020.