Figure bets on Sierra AI agents to unlock stalled home equity loans

Figure Technology Solutions has announced a strategic partnership with Sierra, a conversational AI platform co-founded by Bret Taylor and Clay Bavor, to address a persistent inefficiency in mortgage lending. The collaboration introduces the Figure Agent, built on Sierra’s newly launched Horizon platform, which is designed to manage complex, revenue-generating tasks over extended periods rather than handling simple customer support queries. This marks the first United States use of such a system in the sector.

The initiative targets the gap between application and closure, a challenge highlighted by the Mortgage Bankers Association, which found that only 49 per cent of home equity applications closed in 2024. Despite this low closure rate, home equity line of credit volume reached $271 billion in 2025, representing a significant portion of a $2 trillion industry. The Figure Agent intervenes when an application stalls, following up with borrowers via voice and text to guide them through credit checks, identity verification, and bank account linking before handing the file to a human loan officer.

Pilot results suggest the technology is effective at overcoming these friction points. Stalled applicants who engaged with the agent moved through the verification process at a rate 30 per cent to 52 per cent higher than those who did not. Furthermore, engaged applicants funded 67 per cent more loan volume overall. When the AI agent was paired with a loan officer, the combination produced a 143 per cent lift in funded loan conversion compared with loan officers working alone.

Figure plans to roll out the integration to its network of partners over the coming months. The expansion follows a strong second quarter, during which the company reported Consumer Loan Marketplace volume of $4.3 billion, a 132 per cent increase year over year. Net revenue climbed 113 per cent to $226 million, while net income more than doubled to $87 million. The company also added 102 origination partners in the quarter, bringing its total to 489, and guided to $4.8 billion to $5.2 billion in marketplace volume for the third quarter.

However, the rapid growth has not translated into a richer fee structure for every dollar financed. Figure’s net take rate slipped to 3.6 per cent in the second quarter from 4.0 per cent a year earlier. The business remains heavily dependent on the health of the home equity market and home values, both of which are sensitive to interest rates and broader economic conditions. Additionally, the Sierra partnership is currently in the pilot phase, meaning the network-wide rollout remains a promise rather than a proven track record.

Investors are also weighing structural risks, including Figure’s dual-class share structure and its recent turnaround from a history of losses. Hedge fund ownership of the stock fell to 32 funds in the most recent quarter from 51 the previous quarter, indicating a pullback in institutional conviction. Short interest sits at 6.53 per cent of the float, suggesting a significant bear camp has formed. The market appears to be waiting for proof that the AI-driven conversion gains will persist beyond the initial pilot before fully committing to the growth story.