What's Happening?
Better.com has introduced a new home equity line of credit (HELOC) specifically designed for self-employed individuals, small business owners, and gig workers. Announced on September 30, 2025, this 'bank statement only' HELOC allows borrowers to qualify without traditional documentation like tax returns or W-2s. Instead, the process relies on an AI-driven system called Tinman, which uses alternative data sources for verification. Borrowers can qualify with 12 to 24 months of bank statements, and no physical home appraisal is required for lines of credit up to $400,000. This initiative aims to expand access to home equity loans for those who typically face challenges in qualifying under traditional underwriting processes.
Why It's Important?
The introduction of this AI-driven HELOC by Better.com is significant as it addresses a gap in the lending market for self-employed and gig economy workers, who often struggle to meet the documentation requirements of traditional lenders. By leveraging AI technology, Better.com is not only streamlining the approval process but also potentially increasing its customer base. This move could lead to a broader acceptance of alternative data in financial services, influencing how other lenders approach credit assessments. The program is expected to capture a substantial market share, potentially funding $600 million in home equity loans that were previously inaccessible to these borrowers.
