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Two-stage HELOC screen and assisted fulfillment

Status: accepted Date: 2026-08-24

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Decision

  1. HELOC launches only as an assisted-booking product with the 7 Figures fulfillment team. There is no direct-apply link or Figure API integration.
  2. Eligibility has two stages:
    • a read-only HELOC Prescreen derived automatically from credit and application data
    • an Eligibility Confirmation form whose stored verdict is definitive
  3. The prescreen’s only hard decline is FICO below 640. Missing mortgage, state, and DTI failures are soft because a paid-off home, another property, or verified business income can change the answer.
  4. Definitive FICO floors are 640 for a primary residence and 680 for a non-primary residence.
  5. Definitive DTI is capped at 45% and uses: monthly credit-report debts ÷ (verified personal monthly income + 25% × average monthly business income × (business ownership percentage / 100)).
  6. Equity uses 85% CLTV for primary and 70% for non-primary: CLTV × estimated home value − mortgage and lien balances. It must produce at least 25,000,or25,000, or 35,000 in Texas.
  7. The Figure SMB state matrix dated 2026-05-12 remains authoritative. California stays disabled.
  8. HELOC funding is excluded from MFM’s 15% processing-fee basis and team attribution.
  9. All HELOC launch surfaces are gated by the location-scoped, visible, default-off Labs feature heloc-for-business.

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Context

Credit reports and application answers are useful screening signals but cannot attest every property, paid-off mortgage, lien, or verified source of income. Treating those signals as a final decision would incorrectly reject Applicants. Conversely, waiting for a long manual form before showing any guidance would hide a valuable early signal from Operators. The underwriting sheet dated 2026-08-24 supersedes the Ty guide’s conflicting 50% DTI and Figure’s lower primary-residence FICO floor. The Figure SMB guide’s 2026-05-12 state matrix and the Ty guide’s 2026-07-23 fee treatment remain in force.

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Considered options

  • One automatic decision from credit/application data — rejected because the available inputs cannot establish definitive property and income facts.
  • A manual form with no prescreen — rejected because it removes useful early guidance and increases Operator work on obvious hard declines.
  • Direct Figure application or API fulfillment — deferred; assisted booking is the approved launch scope.

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Consequences

  • Product selection must fail closed unless Labs is enabled and the latest location/contact Eligibility Confirmation is Eligible.
  • Soft prescreen copy must explain the reversible nuance and route to confirmation; it must not imply lender approval.
  • Estimated HELOC values remain Operator-facing.
  • The fulfillment queue is separate from the Processor queue and appears only after plan confirmation and call scheduling.
  • RentCast/home-value automation and Figure API integration remain future decisions.
The canonical implementation spec is docs/plans/heloc-process.md.

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Revision — 2026-09-08

The Operator requested visible preliminary results and reasons on the product card, ownership-adjusted business income, and stale-confirmation checks. The automatic pass is labeled Potentially eligible; only a current eligible confirmation unlocks selection. Existing confirmations using business income without an ownership percentage require that missing answer before reuse.