0001835856False00018358562024-11-122024-11-120001835856us-gaap:CommonClassAMember2024-11-122024-11-120001835856us-gaap:WarrantMember2024-11-122024-11-12

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 12, 2024    
Better Home & Finance Holding Company
(Exact name of registrant as specified in its charter)
Delaware001-4014393-3029990
(State or other jurisdiction of
incorporation or organization)
(Commission File Number)
(I.R.S. Employer Identification
Number)
53 Beach Street, 3rd Floor
New York,
NY
10013
(Address of principal executive offices) (Zip Code)
(415) 523-8837
Registrant’s telephone number, including area code
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Class A common stock, par value $0.0001 per shareBETRThe Nasdaq Stock Market LLC
Warrants exercisable for one share of Class A common stock at an exercise price of $575BETRWThe Nasdaq Stock Market LLC
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


Item 2.02 Results of Operations and Financial Condition.
On November 12, 2024, Better Home & Finance Holding Company (the “Company”) issued a press release announcing the Company’s financial results for the quarter ended September 30, 2024. A copy of the Company’s press release is attached as Exhibit 99.1 to this current report on Form 8-K (this “Report”).
The information in this Item 2.02 and Exhibit 99.1 attached hereto is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Item 7.01 Regulation FD Disclosure.
The Company has prepared materials for presentation to investors. The materials are furnished (not filed) as Exhibit 99.2 to this Report pursuant to Regulation FD.
The information in this Item 7.01 and Exhibit 99.2 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Forward-Looking Statements
This Report and the information and documents incorporated by reference herein include “forward-looking statements.” These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements include, without limitation, statements regarding predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Such statements can be identified by the fact that they do not relate strictly to historical or current facts. When used in this Report, the words “could,” “should,” “will,” “may,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project,” the negative of such terms and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Such forward-looking statements are based on management’s current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. Except as otherwise required by applicable law, the Company disclaims any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this Report. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described in the Company’s annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K.
Item 9.01     Financial Statements and Exhibits.
(d)    Exhibits:
The following exhibits relating to Item 9.01 shall be deemed to be furnished, and not filed:
ExhibitDescription
99.1
99.2
104Cover Page Interactive Data File (formatted as Inline XBRL)


SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
BETTER HOME & FINANCE HOLDING COMPANY
Date: November 13, 2024By:
/s/ Kevin Ryan
Name:
Kevin Ryan
Title:
Chief Financial Officer


Better Home & Finance Holding Company Announces Third Quarter 2024 Results
•Q3 Funded Loan Volume of $1.035 billion, up 42% year-over-year and 8% quarter-over-quarter
•Launched Betsy™, the first voice-based AI loan assistant for the US Mortgage Industry, to enhance customer experience, improve loan-team efficiency, and further accelerate our end-to-end technology platform Tinman™
•Plan to further diversify Better’s distribution channels by leveraging Tinman to power local loan officers through ‘NEO Powered by Better’
•Expect Q4 Funded Loan Volume to be approximately in-line with Q3 given softer seasonality partially offset by continued growth initiatives
•Remain focused on managing towards profitability in the midterm. Expect to drive growth through technology efficiency, diversified distribution channels, and optimized marketing, while balancing growth expenses with corporate cost reductions
New York, NY – November 12, 2024 – Better Home & Finance Holding Company (NASDAQ: BETR; BETRW) (“Better” or the “Company”), a New York-based digitally native homeownership company, today reported financial results for its third quarter ended September 30, 2024.
“We are pleased with the year-over-year growth we achieved in Q3 and the opportunity to help thousands of Americans achieve their homeownership goals this quarter. Our team delivered these results despite limited interest rate relief and continued macro headwinds,” said Vishal Garg, CEO and Founder of Better. “Our technology advances continue to propel the industry forward with the launch of Betsy, the first voice-based AI loan assistant for the US Mortgage Industry. Betsy is our latest innovation built through Tinman, the company’s proprietary loan origination platform, and enhances the operational efficiency of our licensed Loan Officers, Processors and Closers. We anticipate that Betsy will also help ensure our customers can instantly receive intelligent, instant and accurate answers throughout their loan journey with Better.”
Third Quarter 2024 Financial Highlights:
Given a number of significant one-time financial items relating to the closing of Better’s de-SPAC business combination that impacted Q3’23, we are also highlighting the quarter-over-quarter changes from Q2’24.
GAAP Results:
•Revenue of $29.0 million, compared to $32.3 million in Q2’24 and $4.9 million in Q3’23. As a reminder, Q2’24 revenue included certain nonrecurring benefits to Gain on Sale Revenue related to a positive mark-to-market impact on our lock pipeline that totaled approximately $5.5 million, which should be excluded when comparing quarters sequentially
•Net loss of $54.1 million, compared to $41.4 million in Q2’24 and $353.9 million in Q3’23
•Ended Q3 with $480.1 million of cash, restricted cash, short-term investments, and Self-Funded Loans
Key Operating Metrics and Non-GAAP Financial Measures:
•Adjusted EBITDA loss of $38.7 million, compared to $23.3 million in Q2’24 and $53.9 million in Q3’23
•Funded loan volume of $1.035 billion, compared to $962 million in Q2’24 and $731 million in Q3’23, across 3,443 Total Loans in Q3’24
•Purchase loan volume of $739 million comprised 71% of Funded loan volume; HELOC loan volume (which includes home equity lines of credit and closed-end second lien loans) of $166


million comprised 16% of Funded loan volume; and refinance loan volume of $130 million comprised the remainder of Funded loan volume
•D2C loan volume of $776 million, an increase of 102% year-over-year and 16% quarter-over-quarter, comprised 75% of Funded loan volume, with B2B comprising the remainder
“In Q3 we continued leaning into growth, driving a quarter-over-quarter increase in Funded loan volume in-line with the guidance we provided last quarter, alongside increases in our growth expenses including loan team compensation and marketing. Even with some temporary rate relief, this quarter closed with 30-year fixed mortgage rates well above 7%. As such, we remain focused on driving operating leverage through continued investments in efficiency, corporate cost management, and diversifying our distribution channels,” said Kevin Ryan, CFO of Better.
Third Quarter 2024 Highlights:
•Funded loan volume growth was driven by refinance and home equity product growth, including HELOCs and closed-end second lien loans
•Total Expenses increased by approximately $9.5 million quarter-over-quarter, resulting from increases in marketing spend, loan production team compensation, and loan origination expenses, as well as the absence of certain nonrecurring expense benefits taken in Q2’24
•Favorable early results from AI program investments, including the launch of Betsy, which leverages AI and large language models to accelerate a customer’s entire mortgage journey from pre-approval start to closed loan. Betsy is programmed to verbally communicate with customers to answer mortgage application inquiries and to collect and verify outstanding application data. We expect that Betsy will be able to accurately answer detailed questions and efficiently assist with outstanding tasks, enabling faster service times, enhanced self-service capabilities, improved customer engagement, and greater sales efficiency
•Hired the executive team from NEO Home Loans to build out a distributed retail channel, diversifying Better’s offering, and leveraging Tinman™ to power local loan officers through ‘NEO Powered by Better’
•Looking to prove out Tinman’s efficiency in the distributed retail channel by providing leading technology to local loan officers to remove friction from their fulfillment process and expand their capacity to serve more customers
•Expect to leverage Better’s AI technology and digital lead funnel to empower NEO’s Loan Officer teams, who have demonstrated track records in customer service excellence and strong reputations within the communities they serve
•See a unique opportunity to expand our distribution capabilities and unlock key parts of the market that have historically been challenging for direct-to-consumer digital originators without established local footprints to serve, specifically in the purchase mortgage segment
•Launched a streamlined refinancing product for FHA borrowers, and earlier this week introduced a similar streamlined refinancing product for VA borrowers

For more information, please see the detailed financial data and other information available in the Company’s interim report on Form 10-Q, to be filed with the Securities and Exchange Commission (the “SEC”), and the investor presentation on the investor relations section of the Company’s website.



Webcast
Better will host a live webcast of its earnings conference call beginning at 8:30am ET on November 13, 2024. To access the webcast and the related presentation, or to register to listen to the call by phone, go to the investor relations section of the Company’s website at investors.better.com or click the “Attendee Registration Link” below. Please join the webcast at least 10 minutes prior to start time. A replay will be available on the investor relations website shortly after the call ends.
* Webcast Details *
Event Title: Better Home & Finance Holding Company Third Quarter 2024 Results
Event Date: November 13, 2024 08:30 AM (GMT-04:00) Eastern Time (US and Canada)
Attendee Registration Link:
https://events.q4inc.com/attendee/158563083

About Better
Since 2017, Better Home & Finance Holding Company (NASDAQ: BETR; BETRW) has leveraged its industry-leading technology platform, Tinman™, to fund more than $100 billion in mortgage volume. Tinman™ allows customers to see their rate options in seconds, get pre-approved in minutes, lock in rates and close their loan in as little as three weeks. Better’s mortgage offerings include GSE-conforming mortgage loans, FHA and VA loans, and jumbo mortgage loans. Better launched its “One Day Mortgage” program in January 2023, which allows eligible customers to go from click to Commitment Letter within 24 hours. Better was named Best Online Mortgage Lender by Forbes and Best Mortgage Lender for Affordability by WSJ in 2023, ranked #1 on LinkedIn’s Top Startups List for 2021 and 2020, #1 on Fortune’s Best Small and Medium Workplaces in New York, #15 on CNBC’s Disruptor 50 2020 list, and was listed on Forbes FinTech 50 for 2020. Better serves customers in all 50 US states and the United Kingdom.


Forward-looking Statements
This press release contains certain forward-looking statements within the meaning of federal securities laws. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this communication. Such factors can be found in the Company’s annual report on Form 10-K and the Company’s quarterly reports on Form 10-Q, which are available, free of charge, at the SEC’s website at www.sec.gov . New risks and uncertainties arise from time to time, and it is impossible for Better to predict these events or how they may affect us. You are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made, and Better undertakes no obligation, except as required by law, to update or revise the forward-looking statements, whether as a result of new information, changes in expectations, future events or otherwise.
Amounts described as of and for the quarter ended September 30, 2024 represent a preliminary estimate as of the date of this earnings release and may be revised upon filing our Quarterly Report on Form 10-Q with the SEC. More information as of and for the quarter ended September 30, 2024 will be provided upon filing our Quarterly Report on Form 10-Q with SEC.




SELECTED FINANCIAL DATA, NON-GAAP MEASURES AND DEFINITIONS
Following are tables that present selected financial data of the Company. Also included are reconciliations of non-GAAP measures to their most comparable GAAP measures and definitions of certain key metrics used herein.


Results of Operations
Three Months Ended September 30,Three Months Ended June 30,
(Amounts in thousands, except per share amounts)
202420232024
Revenues:
   
Gain on loans, net
$21,503 $11,553 $24,229
Other revenue
3,070 4,009 2,881
Net interest income
   
Interest income
9,867 4,043 9,397
Interest expense
(5,446)(14,698)(4,245)
Net interest income/(loss)
4,421 (10,655)5,152
Total net revenues
28,994 4,907 32,262
Expenses:
   
Compensation and benefits
37,752 84,329 35,254
General and administrative
12,481 14,234 15,155
Technology
7,249 6,349 6,582
Marketing and advertising
12,101 5,064 8,531
Loan origination expense
3,774 627 791
Depreciation and amortization
8,259 10,491 7,990
Other expenses/(Income)
1,332 237,043 (879)
Total expenses
82,948 358,137 73,424
Loss before income tax expense
(53,954)(353,230)(41,162)
Income tax expense/(benefit)
126 659 203
Net loss
($54,080)($353,889)($41,365)


Use of Non-GAAP Measures and Other Financial Metrics
We include certain financial measures not presented in accordance with generally accepted accounting principles (“GAAP”) including Adjusted EBITDA, Adjusted Net Income (Loss) and other key metrics.


We calculate Adjusted Net Income (Loss) as net income (loss) adjusted for the impact of stock-based compensation expense, change in the fair value of warrants, change in the fair value of bifurcated derivative, and other non-core operational expenses. We calculate Adjusted EBITDA as net income (loss) adjusted for the impact of stock-based compensation expense, change in the fair value of warrants, change in the fair value of bifurcated derivative, and other non-recurring or non-core operational expenses, as well as interest and amortization on non-funding debt (which includes interest on the Convertible Note (as defined in our Form 10-Q)), depreciation and amortization expense, and income tax expense. These non-GAAP financial measures should not be considered in isolation and are not intended to be a substitute for any GAAP financial measures. These non-GAAP measures provide supplemental information that we believe helps investors better understand our business, our business model and how we analyze our performance. We also believe these non-GAAP financial measures improve investors’ and analysts’ ability to compare our results with those of our competitors and other similarly situated companies, which commonly disclose similar performance measures.
However, our calculation of Adjusted EBITDA and Adjusted Net Income (Loss) may not be comparable to similarly titled performance measures presented by other companies. Further, although we use these non-GAAP measures to assess the financial performance of our business, these measures exclude certain substantial costs related to our business, and investors are cautioned not to use such measures as a substitute for financial results prepared according to GAAP. Non-GAAP financial measures have limitations in their usefulness to investors because they have no standardized meaning prescribed by GAAP and are not prepared under any comprehensive set of accounting rules or principles. As a result, non- GAAP financial measures should be viewed as supplementing, and not as an alternative or substitute for, our financial results prepared and presented in accordance with GAAP.
Reconciliation of Non-GAAP Metrics
Three Months Ended September 30,Three Months Ended June 30,
(Amounts in thousands)202420232024
Adjusted Net Loss   
Net income (loss) ($54,080)($353,889)($41,365)
Stock-based compensation expense
5,487 39,417 7,959
Change in fair value of warrants and equity related
liabilities
(206)(861)102
Change in fair value of bifurcated derivative
— 237,667 —
    Restructuring, impairment, and other expenses43 679 184
Adjusted Net Loss ($48,756)($76,987)($33,120)
    
Adjusted EBITDA   
Net income (loss) ($54,080)($353,889)($41,365)
Income tax expense / (benefit)
126 659 203
Depreciation and amortization expense
8,259 10,492 7,990
Stock-based compensation expense
5,487 39,417 7,959
    Interest and amortization on non-funding debt1,631 11,939 1,668
    Restructuring, impairment, and other expenses43 679 184
Change in fair value of warrants and equity related
liabilities
(206)(861)102


Change in fair value of bifurcated derivative
— 237,667 —
Adjusted EBITDA ($38,740)($53,897)($23,259)

Consolidated Balance Sheets
September 30,
(Amounts in thousands, except share and per share amounts)2024
Assets
 
Cash and cash equivalents
$207,673
Restricted cash
29,406
Short-term investments
54,414
Mortgage loans held for sale, at fair value
339,485
Loans held for investment
81,401
Other receivables, net
17,337
Property and equipment, net
12,846
Right-of-use assets
3,471
Internal use software and other intangible assets, net
24,684
Goodwill
33,403
Derivative assets, at fair value
4,425
Prepaid expenses and other assets
36,618
Total Assets
$845,163
Liabilities and Stockholders’ (Deficit)/Equity
 
Liabilities
 
Warehouse lines of credit
$134,481
Convertible Note
518,012
Customer deposits
97,782
Accounts payable and accrued expenses
68,427
Escrow payable and other customer accounts
4,736
Derivative liabilities, at fair value
6
Warrant and equity related liabilities, at fair value
1,404
Lease liabilities
4,824
Other liabilities
14,973
Total Liabilities
844,645
Commitments and contingencies
 
Stockholders’ (Deficit)/Equity
 
Common stock $0.0001 par value
2


    Notes receivable from stockholders (9,149)
    Additional paid-in capital1,858,070
    Accumulated deficit (1,851,013)
    Accumulated other comprehensive loss 2,608
Total Stockholders’ (Deficit)/Equity
518
Total Liabilities and Stockholders’ (Deficit)/Equity
$845,163

Key Metrics
This press release refers to the following key metrics:
Funded Loan Volume represents the aggregate dollar amount of all loans funded in a given period based on the principal amount of the loan at funding. Purchase Loan Volume represents the aggregate dollar amount of purchase loans funded in a given period based on the principal amount of the loan. Refinance Loan Volume represents the aggregate dollar amount of refinance loans funded in a given period based on the principal amount of the loan. D2C Loan Volume represents the aggregate dollar amount of loans funded in a given period based on the principal amount of the loan at funding that have been generated from direct interactions with customers using all marketing channels other than our B2B partner relationships. HELOC loan volume represents the aggregate dollar amount of HELOC loans funded in a given period based on the principal amount of the loan at funding. B2B Loan Volume represents the aggregate dollar amount of loans funded in a given period based on the principal amount of the loan at funding that have been generated through one of our B2B partner relationships. Total Loans represents the total number of loans funded in a given period, including purchase loans, refinance loans and HELOC loans. Self-Funded Loans is defined as our Loans Held for Sale and Loans held for Investment as presented on our Balance Sheet less our Warehouse Lines of Credit and Customer Deposits as presented on our Balance Sheet.


For Investor Relations Inquiries please email ir@better.com

Q3 2024 Investor Update November 2024

 
Disclaimer This presentation and any related oral presentation do not constitute an offer or invitation to subscribe for, purchase or otherwise acquire any securities or other instruments of Better Home & Finance Holding Company ("Better" or the "Company") and nothing contained herein or its presentation shall form the basis of any offer, contract or commitment whatsoever. The distribution of this presentation and any related oral presentation in certain jurisdictions may be restricted by law and persons into whose possession this presentation or any related oral presentation comes should inform themselves about, and observe, any such restriction. Any failure to comply with these restrictions may constitute a violation of the laws of any such other jurisdiction Forward Looking Statements This presentation contains certain forward-looking statements within the meaning of federal securities laws. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this communication. Such factors can be found in the most recent annual report on Form 10-K, quarterly report on Form 10-Q and current reports on Form 8-K of Better Home & Finance Holding Company (“Better” or the “Company"), which are available, free of charge, at the SEC’s website at www.sec.gov. New risks and uncertainties arise from time to time, and it is impossible for Better to predict these events or how they may affect us. You are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made, and Better undertakes no obligation, except as required by law, to update or revise the forward-looking statements, whether as a result of new information, changes in expectations, future events or otherwise. Amounts described as of and for the quarter ended September 30, 2024 represent a preliminary estimate as of the date of this presentation and may be revised upon filing our Quarterly Report on Form 10-Q with the SEC. More information as of and for the quarter ended September 30, 2024 will be provided upon filing our Quarterly Report on Form 10-Q with SEC. Use of Non-GAAP Measures and Other Financial Metrics This presentation includes certain financial measures not presented in accordance with generally accepted accounting principles (“GAAP”), including Adjusted Net Income (Loss), Adjusted EBITDA and other key metrics. We calculate Adjusted Net Income (Loss) as net income (loss) adjusted for the impact of stock-based compensation expense, change in the fair value of warrants, change in the fair value of bifurcated derivative, and other non-core operational expenses. We calculate Adjusted EBITDA as net income (loss) adjusted for the impact of stock-based compensation expense, change in the fair value of warrants, change in the fair value of bifurcated derivative, and other non-recurring or non-core operational expenses, as well as interest and amortization on non-funding debt (which includes interest on the Convertible Note (as defined in our Form 10-Q)), depreciation and amortization expense, and income tax expense. These non-GAAP financial measures should not be considered in isolation and are not intended to be a substitute for any GAAP financial measures. These non- GAAP measures provide supplemental information that we believe helps investors better understand our business, our business model and how we analyze our performance. We also believe these non-GAAP financial measures improve investors’ and analysts’ ability to compare our results with those of our competitors and other similarly situated companies, which commonly disclose similar performance measures. However, our calculation of Adjusted EBITDA and Adjusted Net Income (Loss) may not be comparable to similarly titled performance measures presented by other companies. Further, although we use these non-GAAP measures to assess the financial performance of our business, these measures exclude certain substantial costs related to our business, and investors are cautioned not to use such measures as a substitute for financial results prepared according to GAAP. Non-GAAP financial measures have limitations in their usefulness to investors because they have no standardized meaning prescribed by GAAP and are not prepared under any comprehensive set of accounting rules or principles. As a result, non- GAAP financial measures should be viewed as supplementing, and not as an alternative or substitute for, our financial results prepared and presented in accordance with GAAP. For a reconciliation of non-GAAP measures used in this presentation to the closest comparable GAAP measures, see the “Reconciliation of Non-GAAP Measures” section of this presentation. Key Metrics In this presentation, we refer to the following key metrics: Funded Loan Volume represents the aggregate dollar amount of all loans funded in a given period based on the principal amount of the loan at funding. Refinance Loan Volume represents the aggregate dollar amount of refinance loans funded in a given period based on the principal amount of the loan at refinancing date. Purchase Loan Volume represents the aggregate dollar amount of purchase loans funded in a given period based on the principal amount of the loan at purchase date. HELOC Loan Volume represents the aggregate dollar amount of HELOC and closed-end second lien loans funded in a given period based on the principal amount of the loan at funding. D2C Loan Volume represents the aggregate dollar amount of loans funded in a given period based on the principal amount of the loan at funding that have been generated from direct interactions with customers using all marketing channels other than our B2B partner relationships. B2B Loan Volume represents the aggregate dollar amount of loans funded in a given period based on the principal amount of the loan at funding that have been generated through one of our B2B partner relationships. Total Loans represents the total number of loans funded in a given period, including purchase loans, refinance loans, HELOC loans and closed-end second lien loans. Self-Funded Loans represents Mortgage loans held for sale, at fair value and Loans held for investment as presented on the Consolidated Balance Sheets less Warehouse lines of credit and Customer deposits as presented on the Consolidated Balance Sheets. Use of Data The data contained herein is derived from various internal and external sources we believe to be reliable. No representation is made as to the reasonableness of the assumptions within or the accuracy or completeness of any projections or modeling or any other information contained herein. Accordingly, any liability in respect of the information contained herein or in respect of this presentation (including in respect of direct, indirect or consequential loss or damage) is expressly disclaimed. Any data on past performance or modeling contained herein is not an indication as to future performance, and the Company disclaims any obligation, except as required by law, to update or revise the information in this presentation, whether as a result of new information, future events or otherwise. 2

 
Executive Summary Large and Attractive Market Opportunity • Through cycles, U.S. home finance market is ~$3 trillion per year • Existing process is manual, costly and slow • Digital disruption is underway and accelerating Technology & Business Model Competitive Advantage Demonstrated Growth & Expense Discipline Well-Capitalized and Positioned for the Future • End-to-end proprietary origination technology powers faster, better customer experience, lower manufacturing costs, and industry-leading products • Multiple distribution channels – D2C and B2B Partners (“Mortgage-as- a-Service”); further expansion into distributed retail with ‘NEO Home Loans Powered by Better’ • Reduced balance sheet and credit risk with large majority of Total Loans eligible for purchase by GSEs • In Q3’24, grew Funded Loan Volume 42% from Q3’23 and 8% from Q2’24 • In Q3’24, Total Expenses increased ~$10 million vs. Q2'24; still up only 20% from Q4'23 vs. a 96% increase in Funded Loan Volume • Demonstrated growth through continued challenging market environment and concurrent expense discipline, while also making select investments in growth • Ended Q3’24 with $480 million of cash, restricted cash, short-term investments, and self-funded loans1 • Clear product roadmap and defined growth initiatives supported by differentiated technology and existing competitive advantage • Expect to continue leaning into growth while managing towards profitability in the medium term 1. Includes $208 million of Cash and Cash Equivalents, $29 million of Restricted Cash, $54 million of Short-term investments, and $189 million self-funded loans, defined as Mortgage Loans Held for Sale and Loans held for Investment less Warehouse Lines of Credit and Customer Deposits as of September 30, 2024 3

 
Our Vision Relentlessly making homeownership Better for our customers Faster Easier+ Better= Description Home Finance Full range of mortgage and home equity loan products LAUNCHED Jan 2016 One Day Mortgage Enhanced traditional mortgage product offering faster certainty LAUNCHED 1H 2023 Buy & Sell Homes Real estate agent matching engine LAUNCHED Nov 2018 Title One-click title policy matching service LAUNCHED Feb 2019 Homeowners Insurance One-click Homeowners Insurance policy matching service LAUNCHED Jan 2019 Our Progress Under one roof, with one-click Powered by our proprietary technology, Tinman, and customer and property data HELOC Monetize home equity without resetting your rate LAUNCHED 1H 2023 Large and Attractive Market Opportunity 4 Consumer Banking Banking services offered in the U.K. through Bank of Birmingham ACQUIRED 1H 2023

 
Homeownership market is enormous $11 Trillion $13 Trillion $17+ Trillion ~4T2 Financial Network ~2T Insurance (Title & Home) ~33tn U.S. Housing Market ~11tn1 U.S. Mortgage Core Expansion $4T7 Consumer Financial Network $2.5T4 U.S. Home Finance $8T5 International Home Finance $2T6 Home Services Ecosystem Cumulative market size 1. National Association of Home Builders – Housing’s Contribution to Gross Domestic Product 2. Statista Research, ‘Number of new house sales in the United States from 2000 to 2022, by financing type’ 3. Census.gov – The Wealth of Households 2021 (including equity in own home, rental properties, and other real estate) 4. MBA average annual mortgage origination volume, 2017-2026E 5. Allied Market Research – Mortgage Lending Market Research, 2031 6. $1.3T of home rental (IBIS), $600B of home improvement (Farnsworth Group) $13bn of US appraisal and inspection (IBIS), $21bn of moving and storage (IBIS) 7. $1.4 trillion US insurance industry net premiums (Insurance Information Institute), $1.6 trillion student loan debt (Forbes), $1 trillion credit card debt (LendingTree) • Annual spend within the housing market accounted for on average $3 trillion per year, 15-18% of US GDP since 20011 • Since 2013, over 90% of new homes were purchased with a mortgage2 • For average households, home equity totals over 35% of net worth3 • In general, all mortgage transactions require at least one insurance product Large and Attractive Market Opportunity 5

 
Mortgage process remains challenging for consumers 1. Homelight – “Fees and Costs Associated with Selling a House in 2023” 2. Realtor.com - “How Long Does It Take to Get a Mortgage?” 3. CNN Money - “500-page Mortgage Applications are the New Normal” Trulia - “Sale Fail.” Large and Attractive Market Opportunity The homeownership status quo is broken: Our vision is to deliver an experience that is: Expensive Buyers pay fees to up to 10 intermediaries, accounting for ~10% of home price1 Slow The underwriting process can take up to 45 days2 Outdated Innovation is going backwards with incumbents using legacy systems Complicated Mortgage documents can reach 500 pages long3 Better Experience Faster Processing Driving the Best Value 6

 
Our end-to-end proprietary technology, Tinman, powers our digital competitive advantage Home finance lifecycle Better Real Estate Better Title and Settlement Services Better Insurance Manual tasks to non- licensed team members Customer-facing tasks to licensed team members D2C B2B Better Team Members Loan Purchasers Buy Refi Cash- out HELOC Tinman is the backbone that drives our better and faster customer experience Technology & Business Model 7

 
Our proprietary technology delivers tangible results Decreased Fulfillment Cost Increased labor productivity Superior loan quality Technology & Business Model 8 35% Below industry average of $9,000 per loan1 17.7 Funds per Month by the Average Better Mortgage Loan Consultant1 4x Above the Industry Average1 0% Better Post Closing Defect Rate2 1. Based on 2023 data reviewed as part of an internal benchmarking exercise in conjunction with the Mortgage Bankers Association/STRATMOR data 2. Based on a 2H 2024 Post closing Quality Control Sample 1.53% Industry Average Post Closing Defect Rate2 Better Customer Experience Represented 80% of Q3’24 D2C loans

 
Tinman powers Better and our partners D2C Own entire customer experience end-to-end ✓ Direct customer acquisition ✓ Low-cost value proposition ✓ Better-branded, high quality customer experience Partnerships Zero-CAC, co-branding or white-label solutions ✓ Same digital-first experience as D2C ✓ Strong brand affinity ✓ Powered 100% by Better technology ✓ Provide bespoke experience by combining existing solutions and customizing functionality ✓ Plan to further diversify Better’s distribution channels by leveraging Tinman to power local loan officers through ‘NEO Powered by Better’ Reduce costs, improve experience, improve quality Technology & Business Model 9

 
Key Technology Initiatives 10 AI Innovation Core Automation • Testing variety of applications of AI within Tinman, both for internal efficiency and consumer facing • Seek to drive sales and underwriting productivity • Improve customer routing • Expedite structured data capture • Drive end-to-end fulfillment productivity • Automated Initial Review (“AIR”), where Tinman completes initial underwriting and issues commitment letter • Fully autonomous initial data validation and calculations Goal: Reduce sales & fulfillment cost per fund, improve customer conversion Technology & Business Model

 
11 Introducing BetsyTM: Revolutionizing Sales Calling through Artificial Intelligence What is Betsy? Betsy is an AI voice platform programmed to make or take calls from borrowers as a virtual company representative and increase Better’s sales team efficiency. Betsy can make calls on behalf of sales representatives and is more scalable than hiring additional headcount. What can Betsy do on calls with customers? Betsy is programmed to verbally communicate with customers to: ✓ Answer mortgage application inquiries ✓ Collect and verify outstanding application data ✓ Connect customers with complex questions to experienced loan team members ✓ Resolve issues in real-time instead of keeping the customer on hold The Impact of Betsy • Increased Capacity for Sales Reps: Betsy creates immediate bandwidth for Loan Consultants, Home Lending Advisors, and Sales Development Associates by taking on a portion of their call workload and enabling them to manage higher loan volumes. • Scalability: Betsy provides a more scalable and cost-effective solution than hiring additional headcount and requires no training, while improving our speed to lead. • 24/7 Service: Betsy provides close-to-real-time customer outreach and inquiry support and can be be available whenever customers needs us Technology & Business Model

 
Q4’23 $69 Q1’24 $74 Total Expenses ($ millions) $73 Managing towards profitability while growing through improved technology efficiency and corporate cost reductions to offset increased growth expenses …and managing expenses while growing We are leaning into growth… Funded Loan Volume ($ millions) Q4’23 $527 Q1’24 $661 Q2’24 $962 Q3’24 $1,035 96% Funded Loan Volume growth since Q4’23, with Total Expenses up only 20% Demonstrated Growth & Discipline 12 Q2’24 Q3’24 $83

 
Third Quarter 2024 Financial Review • Continued leaning into growth while managing expenses through a challenging mortgage macro environment, with average 30-year fixed mortgage rates seeing little relief and ending the quarter above 7% • Funded loan volume and revenue growth driven by home equity (which includes HELOCs and closed-end second lien loans), and refinance growth • Revenue was approximately $29 million, compared to $32 million in Q2’24 and $5 million in Q3’23 • Q2’24 revenue included approximately $5.5 million of positive mark- to-market impact on our lock pipeline; excluding this impact revenue grew 8% QoQ • Total Expenses increased by approximately $9.5 million quarter-over- quarter, resulting from increases in marketing spend, loan production team compensation, and loan origination expenses, as well as the absence of certain nonrecurring expense benefits taken in Q2’24 • GAAP Net Loss was approximately $54 million in Q3’24, compared to $41 million in Q2'24 and $354 million in Q3'23 • Adjusted EBITDA loss was approximately $39 million in Q3’24, compared to $23 million in Q2'24 and $54 million in Q3’23 $1.035bn Funded Loan Volume Key Financial Highlights Q3’24 Statistics 71% Purchase Volume 75% D2C Volume 3,443 Total Loans 16% HELOC Volume 2.08% Gain on Sale Margin Demonstrated Growth & Discipline 13

 
1. Includes $208 million of Cash and Cash Equivalents, $29 million of Restricted Cash, $54 million of Short-term investments, and $189 million self-funded loans, defined as Mortgage Loans Held for Sale and Loans held for Investment less Warehouse Lines of Credit and Customer Deposits as of September 30, 2024 2. Warehouse mortgage funding capacity available at September 30, 2024 Third Quarter 2024 Balance Sheet • Strong liquidity position providing ample flexibility during a difficult macro environment • We maintain strong relationships with our warehouse financing counterparties to manage mortgage working capital even in a low-volume environment • Effected reverse stock split of Better’s common stock at a ratio of one post-split share for every 50 pre-split shares that enable BETR Class A common stock to regain compliance with the minimum bid price requirement for continued listing on the Nasdaq Global Market Key Highlights Statistics as of September 30, 2024 $480 million Cash, restricted cash, short-term investments and self-funded loans1 $4 million Interest Income from Investments generated in Q3’24 Three Warehouse Facilities $425 million Total Warehouse Capacity2 Well Capitalized and Positioned for the Future 14

 
Focus on Target Opportunities Funnel Conversion • Increase pull-through on approximately 60,000 monthly mortgage application starts through product & service enhancements • Strengthen relationships with real estate agents to improve purchase distribution • Continue hiring experienced Loan Officers with demonstrated customer service track records on highly variable, low fixed compensation plans to align incentives with business outcomes Acquisition Channel Diversification Continued Investment in Automation and AI Fixed Cost Reduction for Improved Profitability • Increase acquisition spend in performing channels, while cautiously investing in new channels and brand marketing • Onboard additional B2B partners, leaning into home equity demand • Persist through extended B2B sales cycles given our platform advantage and favorable medium-term trends of banks and others exiting mortgage • Investments made over the past three years enable operating leverage as we grow, where we expect to grow revenue faster than expenses • Continued investments in One Day Mortgage to make customer experience highly automated and best in class • Continued investments in AI to reduce labor cost and customer time spent • Continued re-evaluation of vendor costs and criticality • Continued targeted reductions in corporate overheads • Sustain well capitalized positioning by cautiously managing liquidity Well Capitalized and Positioned for the Future 15

 
Reconciliation of Non-GAAP Measures 16 Use of Non-GAAP Measures and Other Financial Metrics We include certain financial measures not presented in accordance with generally accepted accounting principles (“GAAP”) including Adjusted EBITDA, Adjusted Net Income (Loss) and other key metrics. We calculate Adjusted Net Income (Loss) as net income (loss) adjusted for the impact of stock-based compensation expense, change in the fair value of warrants and equity related liabilities, and other non-core operational expenses. We calculate Adjusted EBITDA as net income (loss) adjusted for the impact of stock-based compensation expense, change in the fair value of warrants and equity related liabilities, and other non-recurring or non-core operational expenses, as well as interest and amortization on non-funding debt (which includes interest on the Convertible Note (as defined in our Form 10-Q)), depreciation and amortization expense, and income tax expense. These non-GAAP financial measures should not be considered in isolation and are not intended to be a substitute for any GAAP financial measures. These non-GAAP measures provide supplemental information that we believe helps investors better understand our business, our business model and how we analyze our performance. We also believe these non-GAAP financial measures improve investors’ and analysts’ ability to compare our results with those of our competitors and other similarly situated companies, which commonly disclose similar performance measures. However, our calculation of Adjusted EBITDA and Adjusted Net Income (Loss) may not be comparable to similarly titled performance measures presented by other companies. Further, although we use these non-GAAP measures to assess the financial performance of our business, these measures exclude certain substantial costs related to our business, and investors are cautioned not to use such measures as a substitute for financial results prepared according to GAAP. Non-GAAP financial measures have limitations in their usefulness to investors because they have no standardized meaning prescribed by GAAP and are not prepared under any comprehensive set of accounting rules or principles. As a result, non- GAAP financial measures should be viewed as supplementing, and not as an alternative or substitute for, our financial results prepared and presented in accordance with GAAP. Reconciliation of Non-GAAP Metrics

 
Thank You

 
v3.24.3
Cover
Nov. 12, 2024
Document Information [Line Items]  
Document Type 8-K
Document Period End Date Nov. 12, 2024
Entity Registrant Name Better Home & Finance Holding Company
Entity Incorporation, State or Country Code DE
Entity File Number 001-40143
Entity Tax Identification Number 93-3029990
Entity Address, Address Line One 53 Beach Street, 3rd Floor
Entity Address, City or Town New York,
Entity Address, State or Province NY
Entity Address, Postal Zip Code 10013
City Area Code 415
Local Phone Number 523-8837
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company true
Entity Ex Transition Period false
Entity Central Index Key 0001835856
Amendment Flag false
Class A common stock, par value $0.0001 per share  
Document Information [Line Items]  
Title of 12(b) Security Class A common stock, par value $0.0001 per share
Trading Symbol BETR
Security Exchange Name NASDAQ
Warrants exercisable for one share of Class A common stock at an exercise price of $575  
Document Information [Line Items]  
Title of 12(b) Security Warrants exercisable for one share of Class A common stock at an exercise price of $575
Trading Symbol BETRW
Security Exchange Name NASDAQ
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