0001628280-26-017747
SEC filingBetter Home & Finance Holding Company reported a net loss of $165.9 million for FY 2025, an improvement from a net loss of $206.3 million in FY 2024, representing a 20% year-over-year decrease. Total net revenues increased 52% to $164.9 million, driven by a 116% increase in gain on sale of loans, net to $128.2 million, and a 32% increase in Funded Loan Volume to $4.7 billion. However, total expenses remained high at $330.7 million, leading to a comprehensive loss of $160.3 million. The company ended the year with total assets of $1.51 billion and stockholders' equity of $37.2 million, while net cash used in operating activities was $166.6 million. Key growth was seen in the Platform channel and U.K. banking operations, but profitability remains challenged by elevated costs relative to revenue.
Better Home & Finance Holding Company reported a net loss of $165.9 million for FY 2025, an improvement from a net loss of $206.3 million in FY 2024, representing a 20% year-over-year decrease. Total net revenues increased 52% to $164.9 million, driven by a 116% increase in gain on sale of loans, net to $128.2 million. Funded Loan Volume grew 32% to $4.7 billion, with Purchase Loan Volume up 8% to $2.9 billion and HELOC Volume up 78% to $854 million. The company's Gain on Sale Margin improved to 2.87% from 2.17% in the prior year. However, total expenses remained elevated at $330.7 million, with compensation and benefits being the largest component at $174.2 million. The comprehensive loss was $160.3 million, including a foreign currency translation adjustment of $5.6 million.
Revenue growth was primarily driven by the Home Finance segment, which contributed $157.3 million, a 50% increase year-over-year. Within this segment, gain on loans, net was $136.1 million, comprising gain on sale of loans, net of $128.2 million, broker revenue of $7.1 million, and a loan repurchase reserve recovery of $0.8 million. The Banking segment, representing U.K. operations, contributed $7.6 million in revenue, a 120% increase, largely from net interest income of $7.4 million. Geographically, the United States generated $138.8 million (84% of total revenue), while international operations contributed $26.0 million (16%). The company's revenue mix shifted, with gain on loans, net increasing to 82% of total revenue from 72% in the prior year.
The company's Gain on Sale Margin improved to 2.87% from 2.17% in FY 2024, driven by improved loan pricing and an increased mix of higher-margin products and channels. However, overall profitability remained negative due to high operating expenses. Total expenses were $330.7 million, slightly up from $313.9 million in the prior year. Compensation and benefits expenses increased 23% to $174.2 million due to higher headcount and incentive compensation. Marketing and advertising expenses rose 13% to $38.4 million to drive origination volume. Technology expenses increased 7% to $27.9 million due to higher software vendor costs. The company reported a loss before income tax expense of $165.8 million and an income tax expense of $53 thousand.
Net cash used in operating activities was $166.6 million, an improvement from $380.0 million used in the prior year, primarily due to loan originations being more aligned with sales proceeds. Net cash used in investing activities was $661.5 million, driven by $603.8 million in originations of loans held for investment in U.K. banking operations. Net cash provided by financing activities was $714.3 million, largely from a $628.9 million net increase in customer deposits and $167.8 million in net borrowings on warehouse lines of credit. The balance sheet shows total assets of $1.51 billion, up from $913.1 million, with significant increases in Loans Held for Investment ($723.3 million) and Mortgage Loans Held for Sale ($466.7 million). Total liabilities were $1.47 billion, including customer deposits of $763.0 million and warehouse lines of credit of $411.9 million. Stockholders' equity was $37.2 million.
The company's growth strategies include diversifying distribution channels beyond direct-to-consumer, improving conversion rates, enhancing technology innovation, and broadening U.S. geographic and product coverage. Management notes that the business is highly sensitive to interest rate levels and volatility, which affect mortgage origination demand and gain-on-sale margins. The company is in the process of exiting non-core international operations, with one sale completed in Q3 2025 and others expected in 2026. Liquidity is supported by warehouse lines of credit with an aggregate available amount of $575.0 million, customer deposits, and an at-the-market equity offering program. Key risks include continued operating losses, dependence on third-party vendors and strategic relationships, and regulatory compliance costs.