Better Home & Finance Holding Co
For the period ended Jun 30, 2024. Filed Aug 14, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 14, 2024
BETR$19.24+1.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-15.
0001628280-24-023537
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-14.
0001628280-24-037000
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 177 previous paragraphs and 197 current paragraphs.
121 unchanged; 46 reworded; 21 added; 7 removed; 3 previous and 9 current paragraphs rearranged.
Tables are not compared: 11 previous and 12 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (21)
Current report
0.2% for the six months ended June 30, 2024 remained substantially the same year-over-year from 0.2% for the six months ended June 30, 2023. While we are leaning into growth and have seen an increase in our Total Loans and Funded Loan Volume for the three months ended June 30, 2024 compared to the three months ended June 30, 2023, the total value of loans funded in the industry has also increased and the mortgage market remains competitive among lenders, given the interest rate environment, resulting in relatively flat market share on a percentage basis. We continue to focus on originating the most profitable business available to us and seek to avoid growing through highly unprofitable channels.
Current report
Compensation and Benefits Expenses
Current report
Three and Six Months Ended June 30, 2024 as Compared to Three and Six Months Ended June 30, 2023
Current report
Gain on sale of loans, net decreased $2.3 million or 11% to $18.4 million for the three months ended June 30, 2024 compared to $20.7 million for the three months ended June 30, 2023. The decrease was largely driven by a positive mark-to-market impact on loans that we have repurchased, as part of our loan repurchase obligations, and held during the three months ended June 30, 2023, which were not present during the three months ended June 30, 2024. Offsetting this was a benefit during the three months ended June 30, 2024 resulting from a positive mark-to-market impact on our IRLCs.
Current report
Gain on sale of loans, net decreased $5.0 million or 15% to $28.2 million for the six months ended June 30, 2024 compared to $33.2 million for the six months ended June 30, 2023. The decrease was largely driven by a positive mark-to-market impact on loans that we have repurchased, as part of our loan repurchase obligations, and held during the six months ended June 30, 2023, which were not present during the six months ended June 30, 2024. Offsetting this was a benefit due to the increase in HELOC volume and a positive mark-to-market impact on our IRLCs during the six months ended June 30, 2024.
Current report
Integrated partnership fees decreased $0.5 million, or 10% to a gain of $4.7 million for the six months ended June 30, 2024, compared to gain of $5.3 million for the six months ended June 30, 2023. The decrease in integrated partnership fees was primarily driven by the reduction in B2B Loan Volume.
Current report
International lending revenue increased $0.7 million, or 40% to $2.3 million for the six months ended June 30, 2024 compared to $1.7 million for the six months ended June 30, 2023. The increase in international lending revenue was primarily driven by increased operations in the U.K. brokerage businesses.
Current report
Insurance services revenue decreased $0.7 million, or 55% to $0.5 million for the three months ended June 30, 2024 compared to $1.2 million for the three months ended June 30, 2023. The decrease in insurance services revenue was primarily driven by a decrease in Insurance Coverage Written due to fewer insurance transactions.
Current report
Insurance services decreased $0.6 million, or 36% to $1.2 million for the six months ended June 30, 2024 compared to $1.8 million for the six months ended June 30, 2023. The decrease in insurance services revenue was primarily driven by a decrease in Insurance Coverage Written due to fewer insurance transactions.
Current report
Mortgage interest income decreased $0.3 million, or 7% to $4.5 million for the three months ended June 30, 2024 compared from $4.8 million of the three months ended June 30, 2023. Although the number of loans funded increased for the three months ended June 30, 2024 compared to the three months ended June 30, 2023, the increase was primarily at the end of the quarter generating less interest income due to timing.
Current report
Mortgage interest income decreased $1.3 million, or 15% to $7.4 million for the six months ended June 30, 2024 compared from $8.7 million of the six months ended June 30, 2023. Although the number of loans funded increased for the three months ended June 30, 2024 compared to the six months ended June 30, 2023, the increase was primarily at the end of the quarter generating less interest income due to timing.
Current report
Warehouse interest expense decreased $1.4 million, or 36% to $2.6 million for the three months ended June 30, 2024 compared to $4.0 million for the three months ended June 30, 2023. The decrease in warehouse interest expense was primarily driven by carrying a lower average warehouse balance over the three months ended June 30, 2024 compared to three months ended June 30, 2023. We ramped up significantly our HELOC loan product in the second quarter of 2024, which are funded from the Company’s cash balance and not our warehouse lines of credit.
Current report
Warehouse interest expense decreased $2.0 million, or 30% to $4.8 million for the six months ended June 30, 2024 compared to $6.8 million for the six months ended June 30, 2023. The decrease in warehouse interest expense was primarily driven by carrying a lower average warehouse balance over the six months ended June 30, 2024 compared to six months ended June 30, 2023. We ramped up significantly our HELOC loan product in the second quarter of 2024, which are funded from the Company’s cash balance and not our warehouse lines of credit.
Current report
Marketing and advertising expenses were $8.5 million for the three months ended June 30, 2024, an increase of $5.4 million or 175% as compared with $3.1 million in the three months ended June 30, 2023. The increase is due to a focus on growth to drive volume which started at the end of the first quarter in 2024. Marketing and advertising is composed of performance advertising and pilot marketing, which performance advertising scales with volume through existing channels while pilot marketing is market spend to test new channels along with testing brand marketing, which generally costs more upfront.
Current report
Marketing and advertising expenses were $13.1 million for the six months ended June 30, 2024, an increase of $2.2 million or 20% as compared with $10.9 million in the six months ended June 30, 2023. The increase is due to a focus on growth to drive volume which started at the end of the first quarter in 2024. Marketing and advertising is composed of performance advertising and pilot marketing, which performance advertising scales with volume through existing channels while pilot marketing is market spend to test new channels along with testing brand marketing, which generally costs more upfront.
Current report
Loan origination expenses were $0.8 million for the three months ended June 30, 2024, and decrease of $2.6 million or 77%, as compared with $3.4 million in the three months ended June 30, 2023. The decrease in loan origination expenses driven by a reduction in costs associated with loan origination vendors, as well as a decrease in non-HELOC origination volume, and a reduction in our reserve for potential TRID defects.
Current report
Loan origination expenses were $3.4 million for the six months ended June 30, 2024, and decrease of $5.2 million or 61%, as compared with $8.6 million in the six months ended June 30, 2023. The decrease in loan origination expenses was driven by a reduction in costs associated with loan origination vendors.
Current report
If the Class A common stock is no longer listed on Nasdaq, or another national securities exchange, such delisting would constitute a fundamental change under the indenture for the Convertible Note that would require us to redeem the Convertible Note prior to maturity for an amount in cash equal to the principal amount of the Convertible Note plus accrued and unpaid interest to the redemption date. As of June 30, 2024, we had cash and cash equivalents, together with short-term investments of $378.8 million, compared to $528.6 million principal amount outstanding under the Convertible Note. If we are required to redeem the Convertible Note prior to maturity, we may not have sufficient available cash and cash equivalents or be able to obtain additional liquidity, on acceptable terms or at all, to enable us to redeem or refinance the Convertible Note and continue operating the business.
Current report
On June 4, 2024, at the 2024 annual meeting of the Company’s stockholders, the Company’s stockholders approved amendments to the Company’s Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”) to effect one or more reverse stock splits of our Common Stock (as defined below) at a ratio ranging from any whole number between 1-for-2 and 1-for-100 and in the aggregate not more than 1-for-100, inclusive, as determined by the Company’s board of directors (the “Reverse Stock Split Authorization”).
Current report
On August 1, 2024, pursuant to the Reverse Stock Split Authorization, the Company’s board of directors approved a reverse stock split (the “Reverse Stock Split”) and set a split ratio of 1-for-50 of our Class A common stock, Class B common stock, par value $0.0001 per share (“Class B common stock”), and Class C common stock (together “Common Stock”), provided that the Company’s board of directors reserved the right to modify or abandon the amendment prior to filing with the Secretary of State of the State of Delaware. As of the effective time of the Reverse Stock Split, one post-split share of our Common Stock will be issued in exchange for every 50 pre-split shares of our Common Stock. The Reverse Stock Split is currently scheduled to become effective at 6:00 p.m. New York time on August 16, 2024.
Current report
Six Months Ended June 30, 2024 as Compared to Six Months Ended June 30, 2023
Removed paragraphs (7)
Previous report
Compensation and Benefits
Previous report
Gain on sale of loans, net decreased $2.7 million or 22% to $9.8 million for the three months ended March 31, 2024 compared to $12.5 million for the three months ended March 31, 2023. The decrease in gain on sale of loans, net was largely driven by the reduction of Funded Loan Volume.
Previous report
Insurance services remained relatively flat for both the three months ended March 31, 2024 and three months ended March 31, 2023. While Insurance Coverage Written decreased due to fewer insurance transactions, increasing insurance premium costs and more competitive referral revenue sharing agreements with insurance carries resulted in increased revenue per transaction.
Previous report
Mortgage interest income decreased $0.9 million, or 24% to $3.0 million for the three months ended March 31, 2024 compared from $3.9 million of the three months ended March 31, 2023. The decrease in mortgage interest income was primarily driven by the decrease in origination volume and the mortgage interest income earned on the unpaid principal balance for loans held and serviced during the interim between the origination of the loan and its sale on the secondary market.
Previous report
Warehouse interest expense decreased $0.6 million, or 21% to $2.2 million for the three months ended March 31, 2024 compared to $2.8 million for the three months ended March 31, 2023. The decrease in warehouse interest expense was primarily driven by decreased borrowings on funding facilities used in the mortgage production process to meet the decreased origination volume.
Previous report
Marketing and advertising expenses were $4.6 million for the three months ended March 31, 2024, a decrease of $3.2 million or 41% as compared with $7.8 million in the three months ended March 31, 2023. Substantially all of the decrease in marketing and advertising expenses was driven by decreases in customer acquisition-related expenses, as our lower origination volume resulted in less required customer acquisition spend in the aggregate.
Previous report
The Extension Notice has no effect at this time on the listing of our Class A common stock, which will continue to trade on The Nasdaq Capital Market under the symbol “BETR.” We intend to continue to actively monitor the listing of our Class A common stock and, as appropriate, will consider available options to resolve any deficiencies and regain compliance, including seeking stockholder approval at our annual meeting of stockholders to declare and effect one or more reverse stock splits. There can be no assurance that we will be able to maintain compliance with other Nasdaq listing obligations. Failure to maintain other Nasdaq listing requirements could result in the delisting of the Class A common stock from Nasdaq.
Reworded paragraphs (46)
Previous wording
We generate revenue through the production and sale of loans and other product offerings through our platform. The revenue and mix of revenue as a percentage of total revenue attributable to our sale of loan production (Gain on loans, net)
Current wording
We generate revenue through the production and sale of loans and other product offerings through our platform. The revenue and mix of revenue as a percentage of total revenue attributable to our sale of loan production (Gain on loans, net) and Better Plus (Other revenue) and net interest income for the three and six months ended June 30, 2024 and 2023 is as follows:
Previous wording
International lending revenue consists of revenue from our international lending activities, namely in the U.K., which has expanded via acquisitions in prior years. International lending activities primarily include broker fees earned via our digital mortgage broker in the U.K.
Current wording
International lending revenue consists of revenue from our international lending activities, primarily in the U.K., which has expanded via acquisitions in prior years. International lending activities primarily include broker fees earned via our digital mortgage broker in the U.K.
Previous wording
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. Our Funded Loan Volume of $661 million in the three months ended March 31, 2024 decreased by approximately 22% from $847 million in the three months ended March 31, 2023. Beginning in the third quarter of 2023, we also include HELOC loans in our Funded Loan Volume. For the three months ended March 31, 2024, purchase and refinance loans comprised $610 million and HELOC loans comprised $51 million of Funded Loan Volume.
Current wording
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. Our Funded Loan Volume of $962 million in the three months ended June 30, 2024 increased by approximately 5% from $912 million in the three months ended June 30, 2023. Our Funded Loan Volume decreased by approximately 8% period-over-period to $1,623 million in the six months ended June 30, 2024 from $1,758 in the six months ended June 30, 2023. Beginning in the third quarter of 2023, we also include HELOC and closed-end second lien loans in our Funded Loan Volume. For the three months ended June 30, 2024, purchase and refinance loans comprised $872 million and HELOC and closed-end second lien loans comprised $90 million of Funded Loan Volume. For the six months ended June 30, 2024 purchase and refinance loans comprised $1,482 million while HELOC and closed-end second lien loans comprised $142 million of Funded Loan Volume.
Previous wording
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. Our Refinance Loan Volume of $81 million in the three months ended March 31, 2024 increased by approximately 16% from $70 million in the three months ended March 31, 2023.
Current wording
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. Our Refinance Loan Volume of $77 million in the three months ended June 30, 2024 increased by approximately 26% from $61 million in the three months ended June 30, 2023. Our Refinance Loan Volume increased by approximately 21% year-over-year to $159 million in the six months ended June 30, 2024 from $131 million in the six months ended June 30, 2023.
Previous wording
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. Our Purchase Loan Volume decreased by approximately 32% year-over-yearto $529 million in the three months ended March 31, 2024 from $775 million in the three months ended March 31, 2023.
Current wording
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. Our Purchase Loan Volume decreased by approximately 6% year-over-year to $794 million in the three months ended June 30, 2024 from $842 million in the three months ended June 30, 2023. Our Purchase Loan Volume decreased by approximately 18% year-over-year to $1,323 million in the six months ended June 30, 2024 from $1,617 million in the six months ended June 30, 2023.
Previous wording
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. The HELOC product was launched during the first half of 2023. Our HELOC Loan volume increased to $51 million in the three months ended March 31, 2024 from $2 million in the three months ended March 31, 2023.
Current wording
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. The HELOC product was launched during the first half of 2023, and the closed-end second lien product was launched towards the end of 2023, with volume becoming material in the first half of 2024. Our HELOC Loan Volume increased to $90 million in the three months ended June 30, 2024 from $9 million in the three months ended June 30, 2023. Our HELOC Loan Volume increased to $142 million in the six months ended June 30, 2024 from $11 million in the six months ended June 30, 2023.
Previous wording
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. Our D2C Loan Volume of $360 million in the three months ended March 31, 2024 decreased by approximately 26% from $488 million in the three months ended March 31, 2023.
Current wording
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. Our D2C Loan Volume of $670 million in the three months ended June 30, 2024 increased by approximately 28% from $522 million in the three months ended June 30, 2023. Our D2C Loan Volume of $1,030 million in the six months ended June 30, 2024 increased by approximately 2% year-over-year from $1,009 million in the six months ended June 30, 2023.
Previous wording
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. Our B2B Loan Volume of $301 million in the three months ended March 31, 2024 decreased by approximately 16% from $359 million in the three months ended March 31, 2023.
Current wording
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. Our B2B Loan Volume of $292 million in the three months ended June 30, 2024 decreased by approximately 25% from $390 million in the three months ended June 30, 2023. Our B2B Loan Volume of $594 million in the six months ended June 30, 2024 decreased by approximately 21% year-over-year from $749 million in the six months ended June 30, 2023.
Previous wording
Total Loans represents the total number of loans funded in a given period, including purchase loans, refinance loans and HELOC loans. Our Total Loans of 1,991 in the three months ended March 31, 2024 decreased by approximately 16% from 2,366 in the three months ended March 31, 2023.
Current wording
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. Our Total Loans of 2,995 in the three months ended June 30, 2024 increased by approximately 19% from 2,516 in the three months ended June 30, 2023. Our Total Loans of 4,986 in the six months ended June 30, 2024 increased by approximately 2% year-over-year from 4,882 in the six months ended June 30, 2023.
Previous wording
Purchase and refinance loans comprised 1,557 of the Total Loans in the three months ended March 31, 2024 and HELOC loans comprised 434.
Current wording
Purchase and refinance loans comprised 2,134 of the Total Loans in the three months ended June 30, 2024, while HELOC and closed-end second lien loans comprised 861. Purchase and refinance loans comprised 3,691 of the Total Loans in the six months ended June 30, 2024, while HELOC and closed-end second lien loans comprised 1,295.
Previous wording
Average days loans held for sale for the three months ended March 31, 2024 and 2023, were approximately 20 and 20, respectively. This is defined as the average days between funding and sale for loans funded during each period. As of each such reporting date, we had an immaterial amount of loans either 90 days past due or non-performing, as we generally aim to sell loans shortly after production.
Current wording
Average days loans held for sale, excluding Company-funded LHFS and Company-funded HELOC, for the three months ended June 30, 2024 and 2023, were approximately 20 and 23, respectively. Average days loans held for sale, excluding Company-funded LHFS and Company-funded HELOC, for the six months ended June 30, 2024 and 2023, were approximately 22 and 23, respectively. This is defined as the average days between funding and sale for loans funded during each period. As of each such reporting date, we had an immaterial amount of loans either 90 days past due or non-performing, as we generally aim to sell loans shortly after production.
Previous wording
Average Loan Amount represents Total Funded Loan Volume divided by number of loans funded in a period. Our Average Loan Amount decreased by approximately 7% to $332,111 in the three months ended March 31, 2024 from $357,792 in the three months ended March 31, 2023. In general, HELOC loans have lower average loan amounts than purchase or refinance loans, and therefore Average Loan Amount has decreased as a result of HELOC growth in 2023 and the three months ended March 31, 2024 .
Current wording
Average Loan Amount represents Funded Loan Volume divided by Total Loans in a period. Our Average Loan Amount decreased by approximately 11% to $321,178 in the three months ended June 30, 2024 from $362,424 in the three months ended June 30, 2023 and decreased approximately 10% year-over-year to $325,544 during the six months ended June 30, 2024 from $360,179 in the six months ended June 30, 2023. In general, HELOC and closed-end second lien loans have lower average loan amounts than purchase or refinance loans, and therefore Average Loan Amount has decreased as a result of HELOC and closed-end second lien growth.
Previous wording
Gain on Sale Margin represents gain on loans, net, as presented on our condensed consolidated statements of operations and comprehensive income (loss), divided by Funded Loan Volume. Gain on Sale Margin increased by approximately 57%to 2.37% during the three months ended March 31, 2024 from 1.51% year-over-year from the three months ended March 31, 2023. We saw an increase in our Gain on Sale Margin for three months ended March 31, 2024 compared to three months ended March 31, 2023, as a result of a recovery on our Loan Repurchase Reserve which positively impacted our Gain on Loans, net, as well as improved pricing on our Funded Loans.
Current wording
Gain on Sale Margin represents gain on loans, net, as presented on our condensed consolidated statements of operations and comprehensive income (loss), divided by Funded Loan Volume. Gain on Sale Margin decreased by approximately 38 basis points to 2.52% during the three months ended June 30, 2024 from 2.90% for the three months ended June 30, 2023. We saw a decrease in our Gain on Sale Margin for the three months ended June 30, 2024 compared to the three months ended June 30, 2023, as a result of a positive mark-to-market impact on the loans that we have repurchased, as part of our loan repurchase obligations, and held during the second quarter of 2023 that was not present in the second quarter of 2024. Offsetting this was a benefit in the second quarter of 2024 resulting from a positive mark-to-market impact on our IRLCs. Gain on Sale Margin increased by approximately 23 basis points to 2.46% for the six months ended June 30, 2024 from 2.23% for the six months ended June 30, 2023 as a result of increased recovery on our loan repurchase reserve which positively impacted our gain on loans, net, as well as improved pricing on our loans.
Previous wording
Total Market Share represents Funded Loan Volume in a period divided by total value of loans funded in the industry for the same period, as presented by FNMA. Our Total Market Share of 0.2% during the three months ended March 31, 2024 remained substantially the same as 0.3% in the three months ended March 31, 2023. The mortgage market remains competitive among lenders, given the interest rate environment and we continue to focus on originating the most profitable business available to us. As a result, we have pulled back on our most unprofitable channels, resulting in further declines to market share.
Current wording
Total Market Share represents Funded Loan Volume in a period divided by total value of loans funded in the industry for the same period, as presented by FNMA. Our Total Market Share of 0.2% during the three months ended June 30, 2024 remained substantially the same as 0.2% in the three months ended June 30, 2023. Our Total Market Share of
Previous wording
Insurance Coverage Written represents the aggregate dollar amount of insurance liability coverage provided to customers on behalf of insurance carrier partners across all insurance products on the Company’s marketplace, specifically title and homeowners insurance offered through Better Settlement Services and Better Cover. This includes the value of the loan for lender’s title insurance and dwelling coverage for homeowners insurance. Coverage Written amounts for Better Cover have been updated for all periods presented to includes both new policies and policy renewals, which in prior periods included only new policies.
Current wording
Insurance Coverage Written represents the aggregate dollar amount of insurance liability coverage provided to customers on behalf of insurance carrier partners across all insurance products on the Company’s marketplace, specifically title and homeowners insurance offered through Better Settlement Services and Better Cover. This includes the value of the loan for lender’s title insurance and dwelling coverage for homeowners insurance. Insurance Coverage Written amounts for Better Cover have been updated for all periods presented to include both new policies and policy renewals, which in prior periods included only new policies.
Previous wording
Our sources of revenue include gain on loans, net, net interest income, and other revenue.
Current wording
Our sources of revenue include gain on loans, net,, other revenue, and net interest income.
Previous wording
Gain on sale of loans, net also includes the changes in fair value of interest rate lock commitments (“IRLCs”) and forward sale commitments. IRLCs include the fair value upon issuance with subsequent changes in the fair value recorded in each reporting period until the loan is sold on the secondary market. Fair value of forward commitments hedging IRLCs and LHFS are measured based on quoted prices for similar assets.
Current wording
Gain on sale of loans, net also includes the changes in fair value of IRLCs and forward sale commitments. IRLCs include the fair value upon issuance with subsequent changes in the fair value recorded in each reporting period until the loan is sold on the secondary market. Fair value of forward commitments hedging IRLCs and LHFS are measured based on quoted prices for similar assets.
Previous wording
Net interest income includes interest income from LHFS calculated based on the note rate of the respective loan, interest income from short-term investments, and interest income on loans held for investment. Interest expense includes interest expense on warehouse lines of credit, interest expense on customer deposits, as well as interest expense on the Convertible Note.
Current wording
Net interest income includes interest income from LHFS, including HELOCs, calculated based on the note rate of the respective loan, interest income from short-term investments, and interest income on loans held for investment. Interest expense includes interest expense on warehouse lines of credit, interest expense on customer deposits, as well as interest expense on convertible note, a senior subordinated convertible note in the aggregate principal amount of $528.6 million issued to SB Northstar LP (the “Convertible Note”).
Previous wording
Compensation and benefits includes salaries, wages, and incentive pay as well as stock compensation, employee health benefits, 401(k) plan benefits, and social security and unemployment taxes. Stock-based compensation includes expenses associated with restricted stock unit grants, performance stock unit grants, and stock option grants, under our stock plans. We recognize compensation expense for the stock-based payments based on the fair value of the awards on the grant date. The expense is recorded on a straight-line basis over the requisite service period.
Current wording
Compensation and benefits expenses includes salaries, wages, and incentive pay as well as stock compensation, employee health benefits, 401(k) plan benefits, and social security and unemployment taxes. Stock-based compensation includes expenses associated with restricted stock unit grants, performance stock unit grants, and stock option grants under our stock plans. We recognize compensation expense for the stock-based payments based on the fair value of the awards on the grant date. The expense is recorded on a straight-line basis over the requisite service period.
Previous wording
Integrated partnership fees decreased $0.1 million, or 4% to a gain of $2.3 million for the three months ended March 31, 2024, compared to gain of $2.4 million for the three months ended March 31, 2023. The decrease in integrated partnership fees was primarily driven by the reduction in B2B Loan Volume.
Current wording
Integrated partnership fees decreased $0.4 million, or 15% to a gain of $2.5 million for the three months ended June 30, 2024, compared to gain of $2.9 million for the three months ended June 30, 2023. The decrease in integrated partnership fees was primarily driven by the reduction in B2B Loan Volume.
Previous wording
Loan repurchase reserve decreased $5.7 million or 268%, to a recovery of $3.6 million for the three months ended March 31, 2024, compared to a provision of $2.1 million for the three months ended March 31, 2023. The loan repurchase reserve changed from a provision to a recovery as our estimate for potential loss exposure has decreased as we no longer have exposure to the historical periods when we had a significantly higher funded loan volume. The reduction in potential loss exposure results in a reduction in the loan repurchase reserve liability which is recognized as a recovery within gain on loans, net.
Current wording
Loan repurchase reserve decreased $0.6 million or 20%, to a recovery of $3.4 million for the three months ended June 30, 2024, compared to a recovery of $2.8 million for the three months ended June 30, 2023. The loan repurchase reserve has decreased as our estimate for potential loss exposure has declined as we no longer have exposure to the historical periods when we had a significantly higher funded loan volume. The reduction in potential loss exposure results in a reduction in the loan repurchase reserve liability, which is recognized as a recovery within gain on loans, net.
Previous wording
International lending revenue increased $0.1 million, or 12% to $1.1 million for the three months ended March 31, 2024 compared to $1.0 million for the three months ended March 31, 2023. The increase in international lending revenue was primarily driven by increased operations in U.K. brokerage businesses.
Current wording
International lending revenue increased $0.5 million, or 79% to $1.2 million for the three months ended June 30, 2024 compared to $0.7 million for the three months ended June 30, 2023. The increase in international lending revenue was primarily driven by increased operations in the U.K. brokerage businesses.
Previous wording
Real estate services decreased $2.5 million, or 88% to $0.3 million for the three months ended March 31, 2024 compared to $2.9 million for the three months ended March 31, 2023. The decrease in real estate services was primarily driven by a reduction in volume of real estate transactions as well earning lower revenue per transaction for the three months ended March 31, 2024 as we no longer employed any in-house real estate agents and all activity was through our network of third party real estate agents which results in lower revenue per transaction.
Current wording
Real estate services decreased $2.3 million, or 78% to $0.7 million for the three months ended June 30, 2024 compared to $3.0 million for the three months ended June 30, 2023. The decrease in real estate services revenue was primarily driven by a reduction in volume of real estate transactions as well earning lower revenue per transaction for the three months ended June 30, 2024 as we no longer employed any in-house real estate agents and all activity was through our network of third party real estate agents, which results in lower revenue per transaction.
Previous wording
Other revenue increased by $0.3 million, or 58% to $0.7 million for the three months ended March 31, 2024 compared to $0.5 million for the three months ended March 31, 2023. The increase in other revenue was primarily driven by mortgage and non-mortgage loan servicing activities in the U.S. and U.K.
Current wording
Other revenue increased by $0.6 million, or 391% to $0.5 million for the three months ended June 30, 2024 compared to a loss of $0.2 million for the three months ended June 30, 2023. The increase in other revenue was primarily driven by mortgage and non-mortgage loan servicing activities in the U.S. and U.K.
Previous wording
Interest income from investment increased $3.2 million, or 130% to $5.7 million for the three months ended March 31, 2024 compared to $2.5 million for the three months ended March 31, 2023. The increase in interest income from investment was primarily driven by increased investments in securities with maturities ranging from 90 days to 1 year, driven by our cash management strategies and increased available liquidity.
Current wording
Interest income from investments increased $2.2 million, or 78% to $4.9 million for the three months ended June 30, 2024 compared to $2.8 million for the three months ended June 30, 2023. The increase in interest income from investments was primarily driven by increased investments in securities with maturities ranging from 90 days to 1 year, driven by our cash management strategies and increased available liquidity resulting from the capital raised in August 2023 through the closing of the Business Combination.
Previous wording
Other interest expense remained flat at $2.7 million for the three months ended March 31, 2024 compared to $2.7 million for the three months ended March 31, 2023. Other interest expense for the three months ended March 31, 2024 is related to interest expense on our convertible notes while interest expense for the three months ended March 31, 2023 is related to interest expense on our corporate line of credit which was subsequently paid off in full in August 2023.
Current wording
Other interest expense decreased $1.9 million, or 54% to $1.7 million for the three months ended June 30, 2024 compared to $3.6 million for the three months ended June 30, 2023. Other interest expense for the three months ended June 30, 2024 is related to interest expense on the Convertible Note, which is at a lower interest rate, while interest expense for the three months ended June 30, 2023 is related to interest expense on our corporate line of credit, which was at a higher interest rate and was subsequently paid off in full in August 2023.
Previous wording
Compensation and benefits expenses were $38.1 million for the three months ended March 31, 2024, remaining relatively flat in total compared with $38.1 million for the three months ended March 31, 2023. We reduced our headcount between the two periods which lead to a decrease in compensation and benefits that was offset by an increase in stock based compensation. The increase in stock based compensation during the three months ended March 31, 2024 was due to awards that have met the liquidity event criteria with the Closing of the Business Combination in August 2023 as well as service based conditions during the three months ended March 31, 2024.
Current wording
Compensation and benefits expenses were $35.3 million for the three months ended June 30, 2024, an increase of $1.3 million or 4% as compared with $34.0 million for the three months ended June 30, 2023. We reduced our headcount between the two periods, which lead to a decrease in compensation and benefits that was offset by an increase in stock based compensation. The increase in stock based compensation during the three months ended June 30, 2024 was due to awards that have met the liquidity event criteria with the Closing of the Business Combination in August 2023 as well as service based conditions during the three months ended June 30, 2024.
Previous wording
General and administrative expenses were $14.0 million for the three months ended March 31, 2024, a decrease of $2.7 million or 16% as compared with $16.8 million in the three months ended March 31, 2023. The decrease in general and administrative expenses was driven primarily by decreases in rent and occupancy expenses, as we have taken measures to reduce our real estate footprint, as well as reductions in professional services. The reductions in professional services are driven by a reduction in legal expenses as we were incurring higher legal expenses leading up to the Closing of the Business Combination for the three months ended March 31, 2023 in comparison to the three months ended March 31, 2024. The decreases in general and administrative expenses were offset by increases in insurance expenses due to the Closing of the Business Combination as insurance premiums for public companies are significantly higher than those of private companies.
Current wording
General and administrative expenses were $29.2 million for the six months ended June 30, 2024, a decrease of $0.3 million or 1% as compared with $29.5 million in the six months ended June 30, 2023. The decrease in general and administrative expenses was driven primarily by decreases in rent and occupancy expenses, as we have taken measures to reduce our real estate footprint, as well as some reductions in professional services. The reductions in professional services are driven by a reduction in legal expenses as we were incurring higher legal expenses leading up to the Closing of the Business Combination for the six months ended June 30, 2023 in comparison to the six months ended June 30, 2024. The decreases in general and administrative expenses were offset by increases in insurance expenses due to the Closing of the Business Combination as insurance premiums for public companies are significantly higher than those of private companies.
Previous wording
Technology expenses were $5.5 million for the three months ended March 31, 2024, a decrease of $9.0 million or 62% as compared with $14.4 million in the three months ended March 31, 2023. The decrease in technology expenses were driven primarily by a reduction in costs associated with software vendors. This was driven by the reduced headcount, due to which we required fewer software licenses, replacement of certain vendors with more cost efficient alternatives, as well as the termination of non-critical vendors.
Current wording
Technology expenses were $6.6 million for the three months ended June 30, 2024, a decrease of $4.6 million or 41% as compared with $11.2 million in the three months ended June 30, 2023. The decrease in technology expenses were driven primarily by a reduction in costs associated with software vendors. This was driven by the reduced headcount, due to which we required fewer software licenses, replacement of certain vendors with more cost efficient alternatives, as well as the termination of non-critical vendors.
Previous wording
Other expenses were $0.2 million for the three months ended March 31, 2024, a decrease of $11.2 million or 102%, as compared with $11.1 million in the three months ended March 31, 2023. The reduction in other expenses was primarily driven by a reduction in restructuring expenses, as for the three months ended March 31, 2023 we incurred real estate restructuring losses, gain on lease settlement, and impairments of property and equipment related to restructuring initiatives which we did not have during the three months ended March 31, 2024. The reduction in other expenses was also driven by reductions on liability classified warrants and equity related liabilities as a result of the reduced trading price of our common stock, which are recorded as gains during the three months ended March 31, 2024. During the the three months ended March 31, 2023 we recognized losses on the change in fair value of bifurcated derivative which was an embedded feature in the subordinated 0% bridge promissory notes that converted into or were exchanged for Class A common stock and Class C common stock, par value $0.0001 per share (“Class C common stock” and, together with Class A common stock and Class B common stock, the "Common Stock") upon the close of the Business Combination.
Current wording
Other expenses was a gain of $1.1 million for the six months ended June 30, 2024, a decrease of $11.6 million or 110%, as compared with $10.5 million in the six months ended June 30, 2023. The reduction in other expenses was primarily driven by a reduction in restructuring expenses, as for the six months ended June 30, 2023 we incurred real estate restructuring losses, gain on lease settlement, and impairments of property and equipment related to restructuring initiatives which we did not have during the six months ended June 30, 2024. The reduction in other expenses was also driven by reductions on liability classified warrants and equity related liabilities as a result of the reduced trading price of our Common Stock, which were recorded as gains during the six months ended June 30, 2023, while during the three months ended June 30, 2024 we recorded small gains on our liability classified warrants and equity related liabilities as our stock price stabilized.
Previous wording
•Adjusted EBITDA does not reflect (i) interest expense, or the cash requirements necessary to service interest or principal payments on our non-funding debt, which reduces cash available to us; or (ii) tax accruals or tax payments that represent a reduction in cash available to us; and
Current wording
•Adjusted EBITDA does not reflect (i) interest expense, or the cash requirements necessary to service interest or principal payments on our Convertible Note, which reduces cash available to us; or (ii) tax accruals or tax payments that represent a reduction in cash available to us; and
Previous wording
We calculate Adjusted Net 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.
Current wording
We calculate Adjusted Net 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, change in fair value of convertible preferred stock warrants, change in fair value of bifurcated derivative, and restructuring, impairment, and other expenses.
Previous wording
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, interest on the subordinated 0% bridge promissory notes that converted into or were exchanged for our Class A common stock and our Class C common stock (such notes, “Pre-Closing Bridge Notes”), 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), depreciation and amortization expense, and income tax expense.
Current wording
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, change in fair value of convertible preferred stock warrants, change in the fair value of bifurcated derivative, and restructuring, impairment, and other expenses, as well as interest and amortization on non-funding debt (which includes interest on the Convertible Note), depreciation and amortization expense, and income tax expense.
Previous wording
(2)Change in fair value of convertible preferred stock warrants and other warrants, which comprise the Public Warrants and Private Warrants as well as the Sponsor Locked-Up Shares, represents the change in fair value of liability-classified warrants as presented in our Consolidated Statements of Operations and Comprehensive Loss. This charge is a non-cash charge.
Current wording
(2)Change in fair value of warrants and equity related liabilities which comprise the Public Warrants and Private Warrants as well as the Sponsor Locked-Up Shares, represents the change in fair value of liability-classified warrants as presented in our Consolidated Statements of Operations and Comprehensive Loss. Change in fair value of convertible preferred stock warrants represents change in fair value of liability-classified warrants as related to our convertible preferred stock before the completion of the Business Combination. These charges are non-cash charge.
Previous wording
In our normal course of business, we fund substantially all of our Funded Loan Volume on a short-term basis primarily through our warehouse lines of credit. Our borrowings are repaid with the proceeds we receive from the sale of our loans to our loan purchaser network, which includes government-sponsored enterprises (“GSEs”). As of March 31, 2024, we had three warehouse lines of credit in different amounts and with various maturities, with an aggregate available amount of $425.0 million.
Current wording
In our normal course of business, excluding HELOCs, we fund substantially all of our Funded Loan Volume on a short-term basis primarily through our warehouse lines of credit. Our borrowings are repaid with the proceeds we receive from the sale of our loans to our loan purchaser network, which includes government-sponsored enterprises (“GSEs”). As of June 30, 2024, we had three warehouse lines of credit in different amounts and with various maturities, with an aggregate available amount of $425.0 million.
Previous wording
(1)Interest charged under the facility is at the 30-day term SOFR plus 2.125%. Cash collateral deposit of $15.0 million is maintained and included in restricted cash.
Current wording
(1)Interest charged under the facility is at the 30-day term SOFR plus 2.125%. Cash collateral deposit of $15 million is maintained and included in restricted cash. Subsequent to June 30, 2024, the Company extended the maturity to August 31, 2024.
Previous wording
(2)Interest charged under the facility is at the one month SOFR plus 2.10% -2.25%. Cash collateral deposit of $3.8 million is maintained and included in restricted cash.
Current wording
(2)Interest charged under the facility is at the 30-day term SOFR plus 2.10% -2.25%. Cash collateral deposit of $3.8 million is maintained and included in restricted cash.
Previous wording
(3)Interest charged under the facility is at the one month SOFR plus 1.75% - 3.75%. There is no cash collateral deposit maintained as of March 31, 2024.
Current wording
(3)Interest charged under the facility is at the 30-day term SOFR plus 1.75% - 3.75%. There is no cash collateral deposit maintained as of June 30, 2024. Subsequent to June 30, 2024 the Company extended the maturity to August 3, 2025.
Previous wording
On April 9, 2024, we received formal notice that Nasdaq granted our request for an additional 180-day period, or until October 7, 2024, (the “Extension Notice”) to evidence compliance with the $1.00 per share requirement for continued inclusion on The Nasdaq Capital Market pursuant to the Bid Price Rule. If at any time before October 7, 2024, the bid price of the our Class A common stock closes at $1.00 per share or more for a minimum of ten consecutive business days, Nasdaq will provide us with written confirmation of compliance with the Bid Price Rule.
Current wording
On April 9, 2024, we received formal notice that Nasdaq granted our request for an additional 180-day period, or until October 7, 2024, (the “Extension Notice”) to evidence compliance with the $1.00 per share requirement for continued inclusion on The Nasdaq Capital Market pursuant to the Bid Price Rule. If at any time before October 7, 2024, the bid price of our Class A common stock closes at $1.00 per share or more for a minimum of ten consecutive business days, Nasdaq will provide us with written confirmation of compliance with the Bid Price Rule.
Previous wording
If we fail to regain compliance with the Bid Price Rule during the additional compliance period, then Nasdaq will notify us of its determination to delist the Class A common stock, at which point we would have an opportunity to appeal the delisting determination to a Nasdaq Hearings Panel (the “Panel”). A timely request for a hearing will stay any suspension or delisting action pending the issuance of the Panel’s decision.
Current wording
If we fail to regain compliance with the Bid Price Rule during the additional compliance period, then Nasdaq will notify us of its determination to delist the Class A common stock, at which point we would have an opportunity to appeal the delisting determination to a Nasdaq Hearings Panel (the “Panel”). A timely request for a hearing will stay any suspension or delisting action pending the issuance of the Panel’s decision. The Extension Notice has no effect at this time on the listing of our Class A common stock, which will continue to trade on The Nasdaq Capital Market under the symbol “BETR.”
Showing the first 40 of 46 pairs. Open the source sections for the rest.
Rearranged current paragraphs (9)
Current report — wording carried from elsewhere
Loan repurchase reserve increased $6.3 million or 909%, to a recovery of $6.9 million for the six months ended June 30, 2024, compared to a recovery of $0.7 million for the six months ended June 30, 2023. The loan repurchase reserve has decreased as our estimate for potential loss exposure has declined as we no longer have exposure to the historical periods when we had a significantly higher funded loan volume. The reduction in potential loss exposure results in a reduction in the loan repurchase reserve liability, which is recognized as a recovery within gain on loans, net.
Current report — wording carried from elsewhere
Real estate services decreased $4.9 million, or 83% to $1.0 million for the six months ended June 30, 2024 compared to $5.9 million for the six months ended June 30, 2023. The decrease in real estate services was primarily driven by a reduction in volume of real estate transactions as well earning lower revenue per transaction for the six months ended June 30, 2023 as we no longer employed any in-house real estate agents and all activity was through our network of third party real estate agents, which results in lower revenue per transaction.
Current report — wording carried from elsewhere
Other revenue increased by $0.9 million, or 305% to $1.2 million for the six months ended June 30, 2024 compared to $0.3 million for the six months ended June 30, 2023. The increase in other revenue was primarily driven by mortgage and non-mortgage loan servicing activities in the U.S. and U.K.
Current report — wording carried from elsewhere
Interest income from investments increased $5.4 million, or 102% to $10.6 million for the six months ended June 30, 2024 compared to $5.2 million for the six months ended June 30, 2023. The increase in interest income from investment was primarily driven by increased investments in securities with maturities ranging from 90 days to 1 year, driven by our cash management strategies and increased available liquidity resulting from the capital raised in August 2023 through the closing of the Business Combination.
Current report — wording carried from elsewhere
Other interest expense decreased $2.0 million, or 31% to $4.3 million for the six months ended June 30, 2024 compared to $6.3 million for the six months ended June 30, 2023. Other interest expense for the six months ended June 30, 2024 is related to interest expense on the Convertible Note, which is at a lower interest rate, while interest expense for the six months ended June 30, 2023 is related to interest expense on our corporate line of credit, which was at a higher interest rate and was subsequently paid off in full in August 2023.
Current report — wording carried from elsewhere
Compensation and benefits expenses were $73.3 million for the six months ended June 30, 2024, an increase of $1.2 million or 2% as compared with $72.1 million for the six months ended June 30, 2023. We reduced our headcount between the two periods, which lead to a decrease in compensation and benefits that was offset by an increase in stock based compensation. The increase in stock based compensation during the six months ended June 30, 2024 was due to awards that have met the liquidity event criteria with the Closing of the Business Combination in August 2023 as well as service based conditions during the six months ended June 30, 2023.
Current report — wording carried from elsewhere
General and administrative expenses were $15.2 million for the three months ended June 30, 2024, an increase of $2.4 million or 19% as compared with $12.7 million in the three months ended June 30, 2023. The increase in general and administrative expenses was driven primarily by increases in insurance expenses due to the Closing of the Business Combination as insurance premiums for public companies are significantly higher than those of private companies. The increase in general and administrative expenses was partially offset by reductions in our rent and occupancy expenses as we have decreased our real estate footprint in the prior year.
Current report — wording carried from elsewhere
Technology expenses were $12.0 million for the six months ended June 30, 2024, a decrease of $13.6 million or 53% as compared with $25.6 million in the six months ended June 30, 2023. The decrease in technology expenses were driven primarily by a reduction in costs associated with software vendors. This was driven by the reduced headcount, due to which we required fewer software licenses, replacement of certain vendors with more cost efficient alternatives, as well as the termination of non-critical vendors.
Current report — wording carried from elsewhere
Other expenses was a gain of $0.9 million for the three months ended June 30, 2024, an increase of $0.3 million or 64%, as compared with a gain of $0.5 million in the three months ended June 30, 2023. The change in other expenses was primarily driven by reductions on liability classified warrants and equity related liabilities as a result of the reduced trading price of our Common Stock, which were recorded as gains during the three months ended June 30, 2023, while during the three months ended June 30, 2024 our liability classified warrants and equity related liabilities remained relatively flat.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
and Better Plus (Other revenue) for the three months ended March 31, 2024 and 2023 is as follows:
Previous report — wording carried elsewhere
Three Months Ended March 31, 2024 as Compared to Three Months Ended March 31, 2023
Previous report — wording carried elsewhere
Three Months Ended March 31, 2024 as Compared to Three Months Ended March 31, 2023