Better.com partners with Palantir on new proprietary lending platform
Troubled digital mortgage lender better.com partners with secret big data company Palantize to create a proprietary lending platform that is said to enable Fannie Mae, Freddie Mac and mortgage investors to make “mortgage capital allocation decisions based on richer and deeper data.”
Tinman Marketplace, as it has been dubbed, will be powered by Palantir’s Foundry operating system, which Better says will automate 70% of the mortgage process.
The digital lender said it would make “archaic rate sheets” and mortgage eligibility PDFs a thing of the past. It would be paired with the lender’s existing investor and price matching engine.
“For the first time, simultaneous changes to pricing and eligibility criteria will allow capital to flow into underwriting attributes that go beyond the traditional GSE loan-level pricing grid,” Mr. Better in a statement prepared Wednesday.
“Foundry and Tinman will enable a GSE to identify portfolio rebalancing opportunities and almost instantly identify specific points to target to ensure optimal pricing and credit with ease and at new speeds never before seen in the mortgage market” , said Vishal Garg, CEO of Mieux.com.
Better says the platform will leverage dozens of data points, well beyond the standard underwriting points that include property type, credit score, loan-to-value ratio. Tinman could assess lease payments, student debt, and other variables.
“This type of tool is a key step in achieving a fairer and better housing finance market,” Garg said in a prepared statement.
The partnership with Palantir, co-founded by Peter Thiel, appears to be an attempt to resurrect a company that not too long ago was hailed as being at the forefront of innovation in the digital lending space. , but which has more recently been exposed by a lack of a reliable buying firm and a series of self-inflicted scandals.
Better HoldCowhich includes the digital lender as well as its fledgling brokerage, securities and insurance services, announced plans in May 2021 to go public at a $7.7 billion valuation via a merger with a blank check company Aurora Acquisition Company. But that didn’t happen due to what critics described as a combination of the lender’s poor financial performance and a completely dried up SPAC market.
According to a July Filing with the SECBetter.com still plans to go public through a merger with Aurora.
The non-bank digital lender has been embroiled in numerous scandals since its inception in 2016, including a recent accusation by a former executive who claims Garg misled investors when he tried to go public, as well as Garg’s fallout laying off 900 workers in a dystopian zoom call.
Since laying off 15% of the entire workforce in December, the company’s workforce has fallen from 5,800 in March this year to 2,900 as of May 15.
In the first quarter of 2022, the lender reported a loss of $221 million, compared to a profit of $137.5 million in the same period of 2021. Origination volume was down about 40% from compared to the previous year.