Better Home & Finance Holding Co 10-K

Item 8. Financial Statements and Supplementary Data REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and the Board of Directors of Better Home & Finance Holding Company Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Better Home & Finance Holding Company and subsidiaries (the "Company") as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive loss, changes in stockholders' equity (deficit), and cash flows, for each of the two years in the period ended December 31, 2025, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. /s/ Deloitte & Touche LLP New York, NY March 13, 2026 We have served as the Company's auditor since 2020. 72 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS December 31, (Amounts in thousands, except share and per share amounts) 2025 2024 Assets Cash and cash equivalents $ 99,827 $ 211,101 Restricted cash 16,788 24,416 Short-term investments 103,607 53,774 Mortgage loans held for sale, at fair value 466,681 399,241 Loans held for investment (net of allowance for credit losses of $ 2,251 and $ 1,667 as of December 31, 2025 and 2024, respectively) 723,333 111,477 Other receivables, net 14,808 17,549 Assets held for sale 8,687 10,411 Property and equipment, net 1,943 2,717 Right-of-use assets 4,678 1,387 Internal use software and other intangible assets, net 21,985 20,936 Goodwill 10,995 23,615 Derivative assets, at fair value 4,210 2,539 Prepaid expenses and other assets 27,892 33,894 Total Assets $ 1,505,434 $ 913,057 Liabilities and Stockholders’ Equity/(Deficit) Liabilities Warehouse lines of credit $ 411,862 $ 244,070 Convertible note — 519,749 Senior notes 198,802 — Customer deposits 762,984 134,130 Liabilities held for sale 4,802 6,116 Accounts payable and accrued expenses (includes $ 200 and $ 74 payable to related parties as of December 31, 2025 and 2024, respectively) 74,560 48,134 Escrow payable and other customer accounts 172 74 Derivative liabilities, at fair value 2,431 — Warrant and equity related liabilities, at fair value 1,476 1,407 Lease liabilities 4,629 4,081 Other liabilities 6,533 13,466 Total Liabilities 1,468,251 971,227 Commitments and contingencies (see Note 15) Stockholders’ Equity/(Deficit) Common stock $ 0.0001 par value; 66,000,000 and 66,000,000 shares authorized as of December 31, 2025 and 2024, respectively, and 15,996,907 and 15,168,795 shares issued and outstanding as of December 31, 2025 and 2024, respectively 2 2 Notes receivable from stockholders — ( 9,158 ) Additional paid-in capital 2,109,762 1,863,288 Accumulated deficit ( 2,076,238 ) ( 1,910,366 ) Accumulated other comprehensive gain/(loss) 3,657 ( 1,936 ) Total Stockholders’ Equity/(Deficit) 37,183 ( 58,170 ) Total Liabilities and Stockholders’ Equity/(Deficit) $ 1,505,434 $ 913,057 The accompanying notes are an integral part of these consolidated financial statements. 73 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS Year Ended December 31, (Amounts in thousands, except share and per share amounts) 2025 2024 Revenues: Gain on loans, net $ 136,148 $ 78,098 Other revenue 11,299 12,888 Net interest income Interest income 60,269 38,990 Interest expense ( 42,844 ) ( 21,488 ) Net interest income 17,425 17,502 Total net revenues 164,872 108,488 Expenses: Compensation and benefits 174,226 141,089 General and administrative 45,323 52,230 Technology 27,874 26,110 Marketing and advertising 38,356 33,984 Loan origination expense 14,499 9,864 Depreciation and amortization 14,069 33,227 Other expenses/(income) 16,344 17,424 Total Expenses 330,691 313,928 Loss before income tax expense ( 165,819 ) ( 205,440 ) Income tax expense 53 850 Net loss ( 165,872 ) ( 206,290 ) Other comprehensive income/(loss): Foreign currency translation adjustment, net of tax 5,593 ( 222 ) Comprehensive loss $ ( 160,279 ) $ ( 206,512 ) Per share data: Loss per share attributable to common stockholders: Basic $ ( 10.80 ) $ ( 13.65 ) Diluted $ ( 10.80 ) $ ( 13.65 ) Weighted average common shares outstanding — basic 15,358,433 15,111,701 Weighted average common shares outstanding — diluted 15,358,433 15,111,701 The accompanying notes are an integral part of these consolidated financial statements. 74 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT) For the Year Ended December 31, 2025 Common Stock Notes Receivables from Stockholders Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive Gain/(Loss) Total Stockholders' Equity (Deficit) (Amounts in thousands, except share and per share amounts) Issued and Outstanding Par Value Balance - December 31, 2024 15,168,795 $ 2 $ ( 9,158 ) $ 1,863,288 $ ( 1,910,366 ) $ ( 1,936 ) $ ( 58,170 ) Gain on troubled debt restructuring (see Note 13) — — — 210,044 — — 210,044 Tax effect on gain on troubled debt restructuring — — — ( 741 ) — — ( 741 ) Issuance of common stock for options exercised 1,516 — — 19 — — 19 Issuance of common stock under ATM program 547,260 — — 29,221 — — 29,221 Termination of notes receivable from stockholders ( 20,855 ) — 9,158 ( 9,158 ) — — — Stock-based compensation — — — 21,851 — — 21,851 Tax withholding upon vesting of restricted stock units ( 161,422 ) — — ( 4,818 ) — — ( 4,818 ) Shares issued for vested restricted stock units 456,417 — — — — — — Issuance of common stock – other 5,196 — — 56 — — 56 Net loss — — — — ( 165,872 ) — ( 165,872 ) Other comprehensive gain— foreign currency translation adjustment, net of tax — — — — — 5,593 5,593 Balance - December 31, 2025 15,996,907 $ 2 $ — $ 2,109,762 $ ( 2,076,238 ) $ 3,657 $ 37,183 The accompanying notes are an integral part of these consolidated financial statements. 75 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT) For the Year Ended December 31, 2024 Common Stock Notes Receivables from Stockholders Additional Paid-In Capital 1 Accumulated Deficit Accumulated Other Comprehensive Loss Total Stockholders' Equity (Deficit) (Amounts in thousands, except share and per share amounts) Issued and Outstanding 1 Par Value 1 Balance - December 31, 2023 15,035,467 $ 2 $ ( 10,111 ) $ 1,838,499 $ ( 1,704,076 ) $ ( 1,714 ) $ 122,600 Adjustment of transaction costs related to Business Combination — — — ( 2,372 ) — — ( 2,372 ) Issuance of common stock for options exercised 6,814 — — 1,560 — — 1,560 Cancellation of common stock ( 30,673 ) — — — — — — Stock-based compensation — — — 28,534 — — 28,534 Tax withholding upon vesting of restricted stock units ( 67,235 ) — — ( 1,972 ) — — ( 1,972 ) Shares issued for vested restricted stock units 224,422 — — — — — — Vesting of common stock issued via notes receivable from stockholders — — ( 893 ) 885 — — ( 8 ) Settlement of notes receivable from stockholders — — 1,846 ( 1,846 ) — — — Net loss — — — — ( 206,290 ) — ( 206,290 ) Other comprehensive loss— foreign currency translation adjustment, net of tax — — — — — ( 222 ) ( 222 ) Balance - December 31, 2024 15,168,795 $ 2 $ ( 9,158 ) $ 1,863,288 $ ( 1,910,366 ) $ ( 1,936 ) $ ( 58,170 ) 1. Periods have been adjusted to reflect the 1-for-50 reverse stock split on August 16, 2024. See Note 1 Organization and Nature of the Business - Reverse Stock Split, for additional information. The accompanying notes are an integral part of these consolidated financial statements. 76 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS Year Ended December 31, (Amounts in thousands) 2025 2024 Cash Flows from Operating Activities: Net loss $ ( 165,872 ) $ ( 206,290 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation of property and equipment 1,044 7,089 Impairment charges, net 12,505 16,405 Amortization of internal use software and other intangible assets 13,025 26,138 Gain on sale of loans, net ( 128,209 ) ( 59,242 ) Non-cash interest and amortization of debt issuance costs and discounts 1,700 6,208 Change in fair value of warrants and equity related liabilities 69 ( 924 ) Stock-based compensation 20,432 26,753 Recovery of loan repurchase reserve ( 821 ) ( 9,923 ) Provision for credit losses 584 1,667 Amortization/accretion of deferred fees and costs ( 1,709 ) — Change in fair value of derivatives 673 ( 1,685 ) Change in fair value of loans held for investment attributable to hedged risk ( 1,946 ) — Change in fair value of mortgage loans held for sale ( 7,357 ) ( 2,321 ) Loss on disposal of assets held for sale 692 — Change in operating lease of right-of-use assets ( 3,291 ) ( 2,292 ) Originations of mortgage loans held for sale ( 4,678,977 ) ( 3,649,956 ) Proceeds from sale of mortgage loans held for sale 4,744,556 3,478,682 Change in operating assets and liabilities: Other receivables, net 2,295 ( 1,908 ) Prepaid expenses and other assets 9,492 16,859 Operating lease liabilities 548 ( 6,228 ) Accounts payable and accrued expenses 17,028 ( 21,084 ) Escrow payable and other customer accounts 484 567 Other liabilities ( 3,520 ) 1,514 Net cash used in operating activities ( 166,575 ) ( 379,971 ) Cash Flows from Investing Activities: Purchase of property and equipment ( 1,193 ) ( 3,388 ) Payment to dispose of assets held for sale ( 1,597 ) — Proceeds from sale of property and equipment — 2,938 Capitalization of internal use software ( 10,036 ) ( 6,694 ) Maturities of short-term investments 446,726 183,309 Purchase of short-term investments ( 493,088 ) ( 211,863 ) Origination of loans held for investment ( 603,837 ) ( 110,903 ) Principal payments received on loans held for investment 1,518 2,791 Net cash used in investing activities ( 661,507 ) ( 143,810 ) Cash Flows from Financing Activities: Principal payments on convertible notes ( 110,000 ) ( 1,103 ) Principal payments on senior notes ( 1,606 ) — Net borrowings on warehouse lines of credit 167,792 117,852 Net increase in customer deposits 628,854 122,291 Proceeds from issuance of common stock under at-the-market offering 29,221 — Proceeds from issuance of common stock and exercise of stock options 75 91 Net cash provided by financing activities 714,336 239,131 Effects of currency translation on cash, cash equivalents, and restricted cash ( 7,502 ) ( 217 ) Net decrease in cash, cash equivalents, and restricted cash, including cash classified within assets held for sale ( 121,248 ) ( 284,867 ) Less: net change in cash, cash equivalents and restricted cash classified within assets held for sale 2,346 ( 7,682 ) Cash, cash equivalents, and restricted cash—Beginning of year 235,517 528,066 Cash, cash equivalents, and restricted cash—End of year $ 116,615 $ 235,517 The accompanying notes are an integral part of these consolidated financial statements. 77 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS Continued from previous page The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets to the total of the same such amounts shown on the previous page. Year Ended December 31, (Amounts in thousands) 2025 2024 Cash and cash equivalents, end of year $ 99,827 $ 211,101 Restricted cash, end of year 16,788 24,416 Total cash, cash equivalents and restricted cash end of year $ 116,615 $ 235,517 Supplemental Disclosure of Cash Flow Information: Interest paid $ 21,753 $ 13,822 Income taxes paid/(refunded) $ 1,707 $ ( 677 ) Non-Cash Investing and Financing Activities: Convertible notes exchange $ 209,303 $ — Reduction of lease liability via modification/termination $ — $ 20,894 Capitalization of stock-based compensation related to internal use software $ 1,419 $ 1,781 Vesting of stock options early exercised in prior periods $ — $ 1,560 Vesting of common stock issued via notes receivable from stockholders $ — $ 893 Settlement of notes receivable from stockholders $ — $ 1,846 Reclasses to internal use software $ — $ 2,254 Termination of notes receivable from stockholders $ 9,158 $ — The accompanying notes are an integral part of these consolidated financial statements. 78 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. Organization and Nature of the Business Better Home & Finance Holding Company together with its subsidiaries (collectively, the “Company”), provides a comprehensive set of homeownership offerings in the United States and operates a banking platform in the United Kingdom. The Company’s offerings include mortgage loans, real estate agent services, title and homeowner’s insurance, and other homeownership offerings. The Company leverages Tinman, its proprietary technology platform, to optimize the mortgage process from the initial application, to the integration of a suite of additional homeownership offerings, to the sale of loans to a network of loan purchasers. Mortgage loans originated within the United States are through the Company’s wholly-owned subsidiary Better Mortgage Corporation (“BMC”). BMC is an approved Title II Single Family Program Lender with the U.S. Department of Housing and Urban Development’s (“HUD”) Federal Housing Administration (“FHA”), and is an approved seller and servicer with the Federal National Mortgage Association (“FNMA”) and the Federal Home Loan Mortgage Corporation (“FMCC”). The Company conducts banking operations in the United Kingdom through Birmingham Bank, a regulated U.K. banking entity acquired in 2023. In the fourth quarter of 2024, the Company decided to dispose of certain operating units in the U.K., see Note 10 for further details. Unless otherwise indicated, references to “Better,” “Better Home & Finance,” the “Company,” “we,” “us,” “our,” and other similar terms refer to (i) Pre-Business Combination Better and its consolidated subsidiaries prior to the Closing and (ii) Better Home & Finance and its consolidated subsidiaries following the Closing. The Company’s Class A common stock and warrants are listed on the Nasdaq Capital Market (the “Nasdaq”) under the ticker symbols “BETR” and “BETRW,” respectively. Reverse Stock Split— On Friday, August 16, 2024, the Company filed a Certificate of Amendment to its Amended and Restated Certificate of Incorporation, effecting a 1-for-50 reverse stock split of the Company’s common stock (the “Reverse Stock Split”) for the primary purpose of increasing the per share trading price of the Company’s Class A common stock to enable the Company to regain compliance with the minimum bid price requirement for continued listing on The Nasdaq Market LLC (“Nasdaq”). The Company’s Class A common stock began trading on a split-adjusted basis on Nasdaq upon the market open on Monday, August 19, 2024. Effective August 16, 2024, as a result of the Reverse Stock Split, every 50 shares of the Company’s issued and outstanding common stock were converted into one issued and outstanding share of Class A common stock, Class B common stock and Class C common stock, as applicable, without any change to the par value per share, the voting rights of the common stock, any stockholder’s percentage interest in the Company’s equity or any other aspect of the common stock. The accompanying financial statements have been retroactively recast to reflect this reverse split stock resulting in a reclassification to historic financials between common stock and additional paid-in-capital. 2. Summary of Significant Accounting Policies Basis of Presentation — The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Consolidation — The accompanying consolidated financial statements include the accounts of the Company and its consolidated subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates — The preparation of consolidated financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the fair value of mortgage loans held for sale, the fair value of derivative assets and liabilities, which includes interest rate lock commitments and forward sale commitments, the determination of a valuation allowance on the Company’s deferred tax assets, capitalization of internally developed software and its associated useful life, the fair value of acquired intangible assets and goodwill, the provision for loan repurchase reserves, the allowance for credit losses, the incremental borrowing rate used in determining lease liabilities, and the fair value of warrant and equity related liabilities. 79 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Business Combinations — The Company includes the financial results of businesses that the Company acquires from the date of acquisition. The Company records all assets acquired and liabilities assumed at fair value, with the excess of the purchase price over the aggregate fair values recorded as goodwill. Determining the fair value of assets acquired and liabilities assumed requires management to use significant judgment and estimates including the selection of valuation methodologies, estimates of future revenue and cash flows, discount rates and selection of comparable companies. During the measurement period, the Company may record adjustments to the assets acquired and liabilities assumed. Transaction costs associated with business combinations are expensed as incurred. Cash and Cash Equivalents — Cash and cash equivalents consists of cash on hand and other highly liquid and short-term investments with maturities of 90 days or less at acquisition. Of the cash and cash equivalents balances as of December 31, 2025 and 2024, $ 1.0 million and $ 1.3 million, respectively, were insured by the Federal Deposit Insurance Corporation (“FDIC”). Restricted Cash — Restricted cash primarily consists of amounts provided as collateral for the Company’s various warehouse lines of credit as well as escrow funds received from and held on behalf of borrowers. In some instances, the Company may administer funds that are legally owned by a third-party which are excluded from the Company’s consolidated balance sheets. As of December 31, 2025 and 2024, the Company held $ 16.8 million, and $ 24.4 million, respectively, of restricted balances in accordance with the covenants of the agreements relating to its warehouse lines of credit (Note 4) and escrow funds (Note 15). Included in assets held for sale on the consolidated balance sheets as December 31, 2025 and 2024, are $ 4.3 million and $ 3.9 million, respectively, of restricted cash. See Note 10 for further details. Short-term investments — Short term investments consist of fixed income securities, typically U.S. and U.K. government treasury securities and U.S. and U.K. government agency securities with maturities ranging from 91 days to one year. Management determines the appropriate classification of short-term investments at the time of purchase. Short-term investments reported as held-to-maturity are those investments that the Company has both the positive intent and ability to hold to maturity and are stated at amortized cost on the consolidated balance sheets. All of the Company’s short term investments are classified as held to maturity. The Company has not recognized any impairments on these investments to date and any unrealized gains or losses on these investments are immaterial. Allowance for Credit Losses–Held to Maturity (“HTM”) Short-term Investments — The Company's HTM Short-term investments are required to utilize the Current Expected Credit Loss (“CECL”) approach to estimate expected credit losses. Management measures expected credit losses on short-term investments on a collective basis by major security types that share similar risk characteristics, such as financial asset type and collateral type adjusted for current conditions and reasonable and supportable forecasts. Management classifies the short term investments portfolio by security types, such as U.S. or U.K. government agency securities. The U.S. and U.K. government treasury securities and U.S. and U.K. government agency securities are issued by the U.S. and U.K. government entities and agencies. These securities are either explicitly or implicitly guaranteed by the respective governments as to timely repayment of principal and interest, are highly rated by major rating agencies, and have a long history of no credit losses. Therefore, credit losses for these securities were immaterial as the Company does not currently expect any material credit losses on these short-term investments. Mortgage Loans Held for Sale, at Fair Value — The Company sells its loans held for sale (“LHFS”) to loan purchasers. LHFS primarily consists of mortgage loans as well as home equity line of credit and closed-end second lien loans (together defined as “HELOC”), originated for sale by BMC. The Company elects the fair value option, in accordance with Accounting Standard Codification (“ASC”) 825 – Financial Instruments (“ASC 825”), for all LHFS with changes in fair value recorded in gain on loans, net in the consolidated statements of operations and comprehensive loss. Management believes that the election of the fair value option for LHFS improves financial reporting by presenting the most relevant market indication of LHFS. The fair value of LHFS is based on market prices and yields at period end. The Company accounts for the gains or losses resulting from sales of loans based on the guidance of ASC 860-20 – Sales of Financial Assets (“ASC 860”). The Company generally sells all of its loans servicing released. For interim servicing, the Company engaged a third-party sub-servicer to collect monthly payments and perform associated services. The Company issues interest rate lock commitments (“IRLC”) to originate mortgage loans and the fair value of the IRLC, adjusted for the probability that a given IRLC will close and fund, is recognized within gain on loans, net. 80 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Subsequent changes in the fair value of the IRLC are measured at each reporting period within gain on loans, net until the loan is funded. When the loan is funded, the IRLC is derecognized and the LHFS is recognized based on the fair value of the loan. The LHFS is subsequently remeasured at fair value at each reporting period and the changes in fair value are included within gain on loans, net until the loan is sold on the secondary market. When the loan is sold on the secondary market, the LHFS is derecognized and the gain/(loss) is included within gain on loans, net based on the cash settlement. LHFS are considered sold when the Company surrenders control over the loans. Control is considered to have been surrendered when the transferred loans have been isolated from the Company, are beyond the reach of the Company and its creditors, and the loan purchaser obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred loans. The Company typically considers the above criteria to have been met upon receipt of sales proceeds from the loan purchaser. Loan Repurchase Reserve — The Company sells LHFS in the secondary market and in connection with those sales, makes customary representations and warranties to the relevant loan purchasers about various characteristics of each loan, such as the origination and underwriting guidelines, including but not limited to the validity of the lien securing the loan, property eligibility, borrower credit, income and asset requirements, and compliance with applicable federal, state and local laws. In the event of a breach of its representations and warranties, the Company may be required to repurchase or indemnify losses on the loan with the identified defects. The loan repurchase reserve on loans sold relates to expenses incurred due to the potential repurchase of loans, indemnification of losses based on alleged violations or representations and warranties, which are customary to the mortgage banking industry. Provisions for potential losses are charged to expenses and are included within gain on loans, net on the consolidated statements of operations and comprehensive loss. The loan repurchase reserve represents the Company’s estimate of the total losses expected to occur and is considered to be adequate by management based upon the Company’s evaluation of the potential exposure related to the loan sale agreements over the life of the associated loans sold. The Company records the loan repurchase reserve within other liabilities on the consolidated balance sheets. See Note 16 for further analysis. Loans Held for Investment — The Company originates, primarily through its U.K. operations, loans held for investment, for which management has the intent and ability to cause the Company to hold for the foreseeable future or until maturity or payoff and are reported at amortized cost, which is the principal amount outstanding, net of cumulative charge-offs, unamortized net deferred loan origination fees and costs and unamortized premiums or discounts on purchased loans. The allowance for credit losses is a valuation account that is deducted from the loans held for investment amortized cost basis to present the net amount expected to be collected on the loans. Loans are charged-off against the allowance when management believes the loan balance is deemed to be uncollectible. Management’s estimation of expected credit losses is to be incurred over the life of the loan, in accordance with Accounting Standards Codification (“ASC”) 326, Financial Instruments-Credit Losses , which requires an entity to recognize an allowance that reflects the entity’s current estimate of credit losses expected to be incurred over the life of the financial instrument. Managements estimation utilizes a probability of default /loss given default (“PD/LGD”) methodology. Under this approach, expected credit losses are calculated as the product of probability of default, loss given default, and exposure at default for each loan. Management estimates expected credit losses on a collective basis for loans that share similar risk characteristics, which primarily consist of property buy-to-let loans originated through its U.K. banking operations. See Note 5 for additional details. Other Receivables, Net — Other receivables, net consist primarily of amounts due from a third party loan sub-servicer, margin account balances with brokers, an integrated relationship partner, and servicing partners of loan purchasers. Other receivables, net is net of the allowance for credit losses, in accordance with ASC 326, Financial Instruments-Credit Losses . Management’s estimate of credit losses and allowance is based on historical collection experience and a review of the current status of other receivables. It is reasonably possible that management’s estimate of the allowance will change. No allowance has been taken as of December 31, 2025 and 2024, respectively, as the balances reflect amounts considered by management to be fully collectible. Derivatives and Hedging Activities — The Company enters into IRLCs to originate mortgage loans, at specified interest rates and within a specified period of time, with potential borrowers who have applied for a loan and meet certain credit and underwriting criteria. These IRLCs are not designated as accounting hedging instruments and are reflected in the consolidated balance sheets as derivative assets or liabilities, at fair value, with changes in fair value recorded in current 81 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS period earnings. Unrealized gains and losses on the IRLCs are recorded as derivative assets or liabilities, at fair value, on the consolidated balance sheets and in gain on loans, net within the consolidated statements of operations and comprehensive loss. The fair value of IRLCs are measured based on the value of the underlying mortgage loan, quoted MBS prices, estimates of the fair value of the mortgage servicing rights, and adjusted by the estimated loan funding probability, or “pull-through factor”. The Company enters into forward sales commitment contracts for the sale of its mortgage loans held for sale or in the pipeline. These contracts are loan sales agreements in which the Company commits in principle to delivering a mortgage loan of a specified principal amount and quality to a loan purchaser at a specified price on or before a specified date. Generally, the price the loan purchaser will pay the Company is agreed upon prior to the loan being funded (i.e., on the same day the Company commits to lend funds to a potential borrower). Under the majority of the forward sales commitment contracts if the Company fails to deliver the agreed-upon mortgage loans by the specified date, the Company must pay a “pair-off” fee to compensate the loan purchaser. The Company’s forward sale commitments are not designated as accounting hedging instruments and are reflected in the consolidated balance sheets as derivative assets or liabilities at fair value with changes in fair value recorded in current period earnings. Unrealized gains and losses from changes in fair value on forward sales commitments are recorded as derivative assets or liabilities, at fair value on the consolidated balance sheets and in gain on loans, net within the consolidated statements of operations and comprehensive loss. Forward commitments are entered into under arrangements between the Company and counterparties under Master Securities Forward Transaction Agreements, which contain a legal right to offset amounts due to and from the same counterparty and can be settled on a net basis. The Company has evaluated agreements with counterparties and for those counterparties that meet the conditions, positions are presented net. In order to manage interest rate risk on our Loans Held for Investment portfolio, we have entered into pay-fixed, receive-floating interest rate swap contracts to hedge against exposure to changes in the fair value of Loans Held for Investment resulting from changes in interest rates. We designate these interest rate swap contracts as fair value hedges that qualify for hedge accounting under ASC 815, Derivatives and Hedging . The changes in the fair value of the derivative and the hedged item related to the hedged risk are recognized in earnings. We assess hedge effectiveness under ASC 815, on a quarterly basis to ensure all hedges remain highly effective and hedge accounting under ASC 815 can be applied. In conjunction with the assessment of effectiveness, we assess the hedged item to ensure it is expected to be outstanding at the hedged item’s assumed maturity date and the portfolio layer method of accounting under ASC 815 can be applied. The portfolio layer method allows multiple hedged layers of a single closed portfolio. Fair value basis adjustments in an existing portfolio layer method hedge are maintained at the closed portfolio level (Balance Sheet line item level) and are therefore not allocated to individual assets. The Company does not utilize any other derivative instruments to manage risk. Fair Value Measurements — Assets and liabilities recorded at fair value on a recurring basis on the consolidated balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair values. Fair value is defined as the exchange price that would be received for an asset or an exit price that would be paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The price used to measure fair value is not adjusted for transaction costs. The principal market is the market in which the Company would sell or transfer the asset with the greatest volume and level of activity for the asset. In determining the principal market for an asset or liability, it is assumed that the Company has access to the market as of the measurement date. If no market for the asset exists, or if the Company does not have access to the principal market, a hypothetical market is used. The authoritative guidance on fair value measurements establishes a three-tier fair value hierarchy for disclosure of fair value measurements as follows: Level 1 —Unadjusted quoted market prices in active markets for identical assets or liabilities; Level 2 —Inputs (other than quoted prices included in Level 1) are either directly or indirectly observable for the asset or liability. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active; and Level 3 —Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. 82 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Assets and liabilities measured at fair value on a recurring basis include LHFS, derivative assets and liabilities, including IRLCs, forward sale commitments, interest rate swaps and warrant and equity related liabilities. When developing fair value measurements, the Company maximizes the use of observable inputs and minimizes the use of unobservable inputs. However, for certain instruments, the Company must utilize unobservable inputs in determining fair value due to the lack of observable inputs in the market, which requires greater judgment in measuring fair value. In instances where there is limited or no observable market data, fair value measurements for assets and liabilities are based primarily upon the Company’s own estimates, and the measurements reflect information and assumptions that management believes a market participant would use in pricing the asset or liability. Property and Equipment, net — Property and equipment are recorded at cost, less accumulated depreciation and amortization. Depreciation expense is computed on the straight-line method over the estimated useful life of the asset, generally three to five years for computer and hardware and four to seven years for furniture and equipment. Leasehold improvements are depreciated over the shorter of the related lease term or the estimated useful life of the assets. Expenditures for maintenance and repairs necessary to maintain property and equipment in efficient operating condition are charged to operations as incurred while costs of additions and improvements are capitalized. The Company’s property and equipment are considered long-lived assets and are reviewed for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the sum of the undiscounted cash flows expected to result from the use and eventual disposal of the asset and the asset’s carrying amount. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized to the extent the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of are reported at the lower of their carrying amount or the fair value of the asset, less costs to sell. Goodwill — Goodwill represents the excess of the purchase price of an acquired business over the fair value of the assets acquired, less liabilities assumed in connection with the acquisition. Goodwill is tested for impairment at least annually on the first day of the fourth quarter at each reporting unit level, or more frequently if events or changes in circumstances indicate that the carrying amount may be impaired, and is required to be written down when impaired. The guidance for goodwill impairment testing begins with an optional qualitative assessment to determine whether it is more likely than not that goodwill is impaired. The Company is not required to perform a quantitative impairment test unless it is determined, based on the results of the qualitative assessment, that it is more likely than not that goodwill is impaired. The quantitative impairment test is prepared at the reporting unit level. In performing the impairment test, management compares the estimated fair values of the applicable reporting units to their aggregate carrying values, including goodwill. If the carrying amounts of a reporting unit including goodwill were to exceed the fair value of the reporting unit, an impairment loss is recognized within the consolidated statements of operations and comprehensive loss in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. The Company currently has two reporting units. For further details on goodwill impairment see Note 8 and Note 10. Internal Use Software and Other Intangible Assets, Net — The Company reports and accounts for acquired intellectual properties included in other intangible asset with an indefinite life, such as domain name, under ASC 350 , Intangibles-Goodwill and Other (“ASC 350”). Intangible assets with indefinite lives are recorded at their estimated fair value at the date of acquisition and are tested for impairment on an annual basis as well as when there is reason to suspect that their values have been diminished or impaired. Any write-downs will be included in results from operations. Intangible assets with finite lives are recorded at their estimated fair value at the date of acquisition and are amortized over their estimated useful lives using the straight-line method. The Company capitalizes certain development costs incurred in connection with its internal use software and website development. Software costs incurred in the preliminary stages of development are expensed as incurred. Once a software application has reached the development stage, internal and external costs, if direct and incremental, are capitalized until the software is substantially complete and ready for its intended use. Capitalization ceases upon completion of all substantial software testing. The Company also capitalizes costs related to specific software upgrades and enhancements when it is probable the expenditures will result in additional features and functionality. Software maintenance costs are expensed as incurred. For website development, costs incurred in the planning stage are expensed as incurred whereas costs associated with the application and infrastructure development, graphics development, and content development are 83 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS capitalized depending on the type of cost in each of those respective stages. Internal use software and website development are amortized on a straight-line basis over its estimated useful life, generally three years. Impairment of Long-Lived Assets — Long‑lived assets, including property and equipment, right-of-use assets, capitalized software, and other finite-lived intangible assets, are evaluated for recoverability when events or changes in circumstances indicate that the asset may have been impaired. In evaluating an asset for recoverability, the Company considers the future cash flows expected to result from the continued use of the asset and the eventual disposition of the asset. If the sum of the expected future cash flows, on an undiscounted basis, is less than the carrying amount of the asset, an impairment loss equal to the excess of the carrying amount over the fair value of the asset is recognized. Impairment of Indefinite-Lived Intangible Assets —The Company assesses the impairment of indefinite-lived intangible assets whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors the Company considers important, which could trigger an impairment review include items such as significant underperformance compared to historical or projected future operating results and significant changes in the manner or use of the acquired assets or the strategy for the overall business. When the Company determines that the carrying value of an intangible asset may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flows, the Company records an impairment charge. Assets and Liabilities Held for Sale — Assets and liabilities to be disposed of by sale are reclassified into assets held for sale and liabilities held for sale on the consolidated balance sheets. The Company presents the assets and liabilities of a disposal group as held for sale upon meeting all of the following criteria: • Management, having the authority to approve the action, commits to a plan to sell the asset (disposal group). • The asset (disposal group) is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets (disposal groups). • An active program to locate a buyer and other actions required to complete the plan to sell the asset (disposal group) have been initiated. • The sale of the asset (disposal group) is probable, and transfer of the asset (disposal group) is expected to qualify for recognition as a completed sale, within one year. • The asset (disposal group) is being actively marketed for sale at a price that is reasonable in relation to its current fair value. • Actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. The determination as to whether the sale of the disposal group is probable may include significant judgments from management related to the estimated timing of the closing of a future sales transaction. Assets held for sale are measured at the lower of their carrying amount or fair value less cost to sell and are not depreciated or amortized. See Note 10 for further detail on assets and liabilities held for sale. Warehouse Lines of Credit — Warehouse lines of credit represent the outstanding balance of the Company’s warehouse borrowings collateralized by mortgage loans held for sale or related borrowings collateralized by restricted cash. Generally, warehouse lines of credit are used as interim, short-term financing which bears interest at a fixed margin over an index rate, such as the Secured Overnight Financing Rate (“SOFR”). The outstanding balance of the Company’s warehouse lines of credit will fluctuate based on its lending volume. The advances received under the warehouse lines of credit are based upon a percentage of the fair value or par value of the mortgage loans collateralizing the advance, depending upon the type of mortgage loan. Should the fair value of the pledged mortgage loans decline, the warehouse provider may require the Company to provide additional cash collateral or mortgage loans to maintain the required collateral level under the relevant warehouse line. The Company did not incur any significant issuance costs related to its warehouse lines of credit. Leases — The Company accounts for its leases in accordance with ASC 842, Leases (“ASC 842”). The Company’s lease portfolio primarily consists of operating leases for a number of small offices across the country for licensing purposes 84 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as well as several larger offices for employee and Company headquarters. The Company also leases various types of equipment, such as laptops and printers. The Company determines whether an arrangement is a lease at inception. The Company has made an accounting policy election to exempt leases with an initial term of 12 months or less (“short-term leases”) from being recognized on the consolidated balance sheets. Short-term leases are not material in comparison to the Company’s overall lease portfolio. Payments related to short-term leases are recognized in the consolidated statements of operations and comprehensive loss on a straight-line basis over the lease term. The Company also elected not to separate non-lease components of a contract from the lease component to which they relate. For leases with initial terms of greater than 12 months, the Company determines its classification as an operating or finance lease. At lease commencement, the Company recognizes a lease obligation and corresponding right-of-use asset based on the initial present value of the fixed lease payments using the Company's incremental borrowing rates for its population of leases. For leases that qualify as an operating lease, the right-of-use assets related to operating lease obligations are recorded in right-of-use assets in the consolidated balance sheets. The rate implicit on the Company’s leases are not readily determinable, therefore, management uses its incremental borrowing rate to discount the lease payments based on the information available at lease commencement. The incremental borrowing rate represents the rate of interest the Company would have to pay to borrow over a similar term, and with a similar security, in a similar economic environment, an amount equal to the fixed lease payments. The commencement date is the date the Company takes initial possession or control of the leased premise or asset, which is generally when the Company enters the leased premises and begins to make improvements in preparation for its intended use. Non-cancelable lease terms for most of the Company's real estate leases typically range between 1 - 5 years and may also provide for renewal options. Renewal options are typically solely at the Company’s discretion and are only included within the lease term when the Company is reasonably certain that the renewal options would be exercised. When a modification to the contractual terms occurs, the lease liability and right-of-use asset is remeasured based on the remaining lease payments and incremental borrowing rate as of the effective date of the modification. When a lease is terminated, the carrying amount of the lease liability and right-of-use asset are reduced, and any difference between them is recognized as a gain or loss within other expenses/(income) on the consolidated statements of operations and comprehensive loss. The Company evaluates its right-of-use assets for impairment consistent with the impairments of long-lived assets policy disclosure described above. Convertible Note — As part of the Closing of the Business Combination, the Company issued to SB Northstar LP, an affiliate of SoftBank Group Corp., a senior subordinated convertible note (the “Convertible Note”). Upon initial issuance, the Convertible Note is evaluated for redemption and conversion features that could result in embedded derivatives that require bifurcation from the notes. Upon initial issuance, any embedded derivatives are measured at fair value. Convertible Note proceeds are allocated between the carrying value of the note and the fair value of embedded derivatives on the initial issuance date. Any portion of proceeds allocated to embedded derivatives are treated as reductions in, or discounts to, the carrying value of the Convertible Note on the issuance date. Embedded derivatives are adjusted to fair value at each reporting period, with the change in fair value included within interest expense on the consolidated statements of operations and comprehensive loss. See Note 13 for further details on the Convertible Note. Senior Notes — Upon initial issuance, the Senior Notes are evaluated for redemption and conversion features that could result in embedded derivatives that require bifurcation from the notes. Upon initial issuance, any embedded derivatives are measured at fair value. The notes proceeds are allocated between the carrying value of the note and the fair value of embedded derivatives on the initial issuance date. Any portion of proceeds allocated to embedded derivatives are treated as reductions in, or discounts to, the carrying value of the Senior Notes on the issuance date. Embedded derivatives are adjusted to fair value at each reporting period, with the change in fair value included within interest expense on the condensed consolidated statements of operations and comprehensive loss. See Note 13 for further details on the Senior Notes. Debt Modifications and Extinguishments — When the Company modifies or extinguishes debt, it first evaluates whether the modification qualifies as a troubled debt restructuring (“TDR”) under ASC 470-60 - Troubled Debt Restructurings by Debtors ("ASC 470-60"), which requires debt modifications to be evaluated if (1) the borrower is experiencing financial difficulty, and (2) the lender grants the borrower a concession. Concessions may include modifications to the terms of the debt, such as reducing the interest rate, extending the repayment period, or forgiving a 85 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS portion of the debt. If a TDR is determined not to have occurred, the Company evaluates the modification in accordance with ASC Topic 470-50-40, which requires modification to debt instruments to be evaluated to assess whether the modifications are considered “substantial modifications”. A substantial modification of terms is accounted for like an extinguishment. Warrant Liabilities — The Company assumed publicly-traded warrants (“Public Warrants”) issued in Aurora’s initial public offering, private placement warrants issued by Aurora in connection with its formation and warrants attached to certain private placement units (collectively, the “Private Warrants” and, together with the Public Warrants, the “Warrants”). Each Warrant issued entitles the holder to purchase one share of Class A common stock at an exercise price of $ 11.50 per share, subject to certain adjustments, at any time commencing 30 days after the consummation of the Business Combination (which for the avoidance of doubt was September 21, 2023). Subsequent to the Reverse Stock Split, 50 Warrants would need to be exercised to purchase one share of Class A common stock at an exercise price of $ 575 per share. The Public Warrants are publicly traded and may be exercised on a cashless basis upon the occurrence of certain conditions. The Private Warrants are exercisable on a cashless basis and are not redeemable by the Company so long as they are held by the initial purchasers or their permitted transferees, subject to certain exceptions. If the Private Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Warrants will be redeemable by the Company and exercisable by the holders on the same basis as the Public Warrants. The Company evaluated the Public Warrants and Private Warrants and concluded that both meet the definition of a derivative and will be accounted for at fair value in accordance with ASC Topic 815-40, Derivatives and Hedging – Contracts in Entity’s Own Equity , as the Public Warrants and Private Warrants are not considered indexed to the Company's stock. Changes in the fair value of Warrants are included within other expenses/(income) in the consolidated statement of operations and comprehensive loss. As of December 31, 2025 and 2024, the balance of the Warrants was $ 1.2 million and $ 1.3 million, respectively, and is included within Warrant and equity related liabilities on the consolidated balance sheets. Sponsor Locked-Up Shares — The Sponsor Locked-Up Shares are accounted for as a derivative and are included within warrants and equity related liabilities on the consolidated balance sheets. These shares are subject to transfer restrictions, which will be released contingent upon the price of Class A common stock exceeding certain thresholds or upon some strategic events, which include events that are not indexed to Class A common stock. As the Sponsor Locked-Up Shares are not considered indexed to the Company’s stock, they are accounted for at fair value in accordance with ASC Topic 815-40, Derivatives and Hedging – Contracts in Entity’s Own Equity. Changes in the fair value of Sponsor Locked-Up Shares are included within other expenses/(income) in the consolidated statement of operations and comprehensive loss. As of December 31, 2025 and 2024, the balance of the Sponsor Locked-Up Shares was $ 0.3 million and $ 0.1 million, respectively, and is included in Warrant and equity related liabilities on the consolidated balance sheets. Income Taxes — Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the expected future tax consequences attributable to temporary differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income or expense in the period that includes the enactment date. A valuation allowance is established when necessary to reduce deferred income tax assets to the amount expected to be realized based on management’s consideration of all positive and contradictory evidence available. The Company evaluates uncertainty in income tax positions based on a more-likely-than-not recognition standard. If that threshold is met, the tax position is then measured at the largest amount that is greater than 50% likely of being realized upon ultimate settlement. If applicable, the Company records interest and penalties as a component of income tax expense. Foreign Currency Translation — The U.S. dollar is the functional currency of the Company’s consolidated entities operating in the United States. The Company’s non U.S. dollar functional currency operations include a non-operating service entity as well as several operating entities resulting from acquisitions. All balance sheet accounts have been translated using the exchange rates in effect as of the balance sheet date. Amounts in the consolidated statements of operations and comprehensive loss have been translated using the monthly average exchange rates for each month in the year. Accumulated net translation adjustments have been reported separately in other comprehensive loss in the consolidated statements of operations and comprehensive loss. 86 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Revenue Recognition — The Company generates revenue from the following streams: 1. Gain on loans, net includes revenues generated from the Company’s loan production process, see Note 3. The components of gain on loans, net are as follows: i. Gain on sale of loans, net —This represents the premium the Company receives in excess of the loan principal amount and certain fees charged by loan purchasers upon sale of loans into the secondary market. Gain on sale of loans, net includes unrealized changes in the fair value of LHFS, which are recognized on a loan by loan basis as part of current period earnings until the loan is sold on the secondary market. The fair value of LHFS is measured based on observable market data. 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 sale commitments hedging IRLCs and LHFS are measured based on quoted prices for similar assets. ii. Broker Revenue —Includes fees that the Company receives for originating loans on behalf of third-parties. iii. Loan repurchase reserve recovery/(provision) —In connection with the sale of loans on the secondary market, the Company makes customary representations and warranties to the relevant loan purchasers about various characteristics of each loan, such as the origination and underwriting guidelines, including but not limited to the validity of the lien securing the loan, property eligibility, borrower credit, income and asset requirements, and compliance with applicable federal, state and local laws. In the event of a breach of its representations and warranties, the Company may be required to repurchase the loan with the identified defects. The provision for loan repurchase reserve, represents the charge for these potential losses. 2. Other revenue consists of revenue from the Company’s additional offerings such as real estate services, insurance services, and international lending revenue, which is recognized in accordance with ASC 606, Revenue from Contracts with Customers (“ASC 606”). ASC 606 outlines a single comprehensive model in accounting for revenue arising from contracts with customers. The core principle, involving a five-step process, of the revenue model is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. For real estate services, the Company generates revenues from fees related to real estate agent services, mainly from cooperative brokerage fees from the Company’s network of third-party real estate agents, which assist customers in the purchase or sale of a home. The Company recognizes revenues from real estate services upon completion of the performance obligation which is when the mortgage transaction closes. Performance obligations for real estate agent services are typically completed 40 to 60 days after the commencement of the home search process. Payment for these services is typically settled in cash as part of closing costs to the borrower upon closing of the mortgage transaction. Also included in real estate services are settlement services, which are revenue from fees charged for services such as title search fees, wire fees, policy and document preparation, and other mortgage settlement services. The Company recognizes revenues from settlement services upon completion of the performance obligation, which is when the mortgage transaction closes. Insurance revenue primarily consists of fees earned on homeowners insurance policies and title insurance. The Company generates revenues from agent fees on homeowners insurance policies obtained by customers through the Company’s marketplace of third-party insurance carriers. The Company offers title insurance as an agent and works with third-party providers that underwrite the title insurance policies. For title insurance, the Company recognizes revenue from fees upon the completion of the performance obligation which, is when the mortgage transaction closes. For homeowners insurance and title insurance, the Company is the agent in the transactions as the Company does not control the ability to direct the fulfillment of the service, is not primarily responsible for fulfilling the performance of the service, and does not assume the risk in a claim against a policy. 87 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For international lending revenue, the Company generates revenue primarily from broker fees earned in the U.K. The Company recognizes international lending revenue upon completion of the performance obligation, which is when the mortgage provider approves the mortgage. 3. 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 corporate debt. Compensation and Benefits — Compensation and benefits include salaries, wages, and incentive pay as well as stock-based 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 the Company’s stock plans. Compensation expense for the stock-based payments is based on the fair value of the awards on the grant date. Compensation and benefits expenses are expensed as incurred with the exception of stock-based compensation, which is recognized in a straight-line basis over the requisite service period. Stock-Based Compensation — The Company measures and records the expense related to stock-based compensation awards based on the fair value of those awards as determined on the date of grant. The Company recognizes stock-based compensation expense over the requisite service period of the individual grant, generally equal to the vesting period and uses the straight-line method to recognize stock-based compensation. For stock-based compensation with performance conditions, the Company records stock-based compensation expense when it is deemed probable that the performance condition will be met. For Restricted Stock Units (“RSUs”), the fair value of the stock-based compensation award is based on the closing price of the Company’s common stock on the date of the grant. For stock options, the Company uses the Black-Scholes-Merton (“Black-Scholes”) option-pricing model to determine the fair value. The Black-Scholes option-pricing model requires the use of highly subjective and complex assumptions, which determine the fair value of stock-based compensation awards, including the option’s expected term and the price volatility of the underlying stock. The Company calculates the fair value of stock options granted using the following assumptions: a) Expected Volatility—The Company estimated volatility for option grants by evaluating the average historical volatility of a peer group of companies for the period immediately preceding the option grant for a term that is approximately equal to the options’ expected term. b) Expected Term—The expected term of the Company’s options represents the period that the stock-based awards are expected to be outstanding. The Company has elected to use the midpoint of the stock options vesting term and contractual expiration period to compute the expected term, as the Company does not have sufficient historical information to develop reasonable expectations about future exercise patterns and post-vesting employment termination behavior. c) Risk-Free Interest Rate—The risk-free interest rate is based on the implied yield currently available on US Treasury zero-coupon issues with a term that is equal to the options’ expected term at the grant date. d) Dividend Yield—The Company has not declared or paid dividends to date and does not anticipate declaring dividends. As such, the dividend yield has been estimated to be zero. The Company accounts for forfeitures of stock options and RSUs as they occur rather than estimating forfeitures at the time of grant. The Company records compensation expense related to stock options issued to non-employees, including consultants based on the fair value of the stock options on the grant date over the service performance period as the stock options vest. The Company previously allowed stock option holders to early exercise stock options prior to the vesting date. The early exercise of stock options not yet vested are not reflected within stockholders’ equity or on the consolidated balance sheets as they relate to unvested share awards and therefore are considered non-substantive exercises. 88 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS General and Administrative Expenses — General and administrative expenses include rent and occupancy expenses, insurance, and external legal, tax and accounting services. General and administrative expenses are expensed as incurred. Technology Expenses — Technology expenses consist of direct costs related to vendors engaged in product management, design, development, and testing of the Company’s websites and products. Technology expenses are expensed as incurred. Marketing and Advertising Expenses — Marketing and advertising expenses consist of direct costs related to customer acquisition expenses, brand costs, and paid marketing. For customer acquisition expenses, the Company primarily generates loan origination leads for which the Company incurs “pay-per-click” expenses. Marketing and advertising expenses are expensed as incurred. Loan Origination Expenses — Loan origination expenses consist of costs directly attributable to the production of loans such as appraisal fees, processing expenses, underwriting, closing fees, and servicing costs. For mortgage loans held for sale that are accounted for at fair value, these costs are expensed as incurred. Other Expenses/(Income) — Other expenses consist of direct costs related to other non-mortgage homeownership activities, including settlement service expenses, lead generation expenses, expenses incurred in relation to our international lending activities, restructuring and impairment expenses, and gains and losses from equity related liabilities. Settlement service expenses consist of fees for transactional services performed by third-party providers for borrowers while lead generation expenses consist of fees for services related to real estate agents. Other expenses are expensed as incurred. Net Income (Loss) Per Share — Basic net income (loss) per share attributable to common stockholders is computed by dividing the net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted net income (loss) attributable to common stockholders is computed by adjusting net income (loss) attributable to common stockholders to reallocate undistributed earnings based on the potential impact of dilutive securities. Diluted net income (loss) per share attributable to common stockholders is computed by dividing the diluted net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding for the period, including potential dilutive common shares. Historically, for purpose of this calculation, outstanding stock options, public and private warrants, and sponsor locked-up shares are considered potential dilutive common shares. Diluted net income (loss) per share is the amount of net income (loss) available to each share of common stock outstanding during the reporting period, adjusted to include the effect of potentially dilutive common shares. For periods in which the Company reports net losses, basic and diluted net loss per share attributable to common stockholders are the same because potentially dilutive common shares are not assumed to have been issued if their effect is anti-dilutive. For the years ended December 31, 2025 and 2024, the Company reported a net loss attributable to common stockholders. Segments — The Company’s chief operating decision maker (“CODM”), the Chief Executive Officer, manages the Company’s business activities across two operating and reportable segments. Accordingly, the CODM uses segment net income (loss) from operations to allocate resources and assess performance. The CODM reviews budget-to-actual variances for segment net income (loss) on a regular basis when making decisions about allocating resources to each segment. Further, the CODM reviews and utilizes functional expenses at the segment level to manage the Company’s operations. Other segment items included in net income are net interest income, depreciation and amortization, and income tax expense (benefit), which are reflected in the consolidated statements of operations and comprehensive loss. Emerging Growth Company and Smaller Reporting Company Status — The Company is an emerging growth company (“EGC”), as defined in Section 2(a) of the Securities Act of 1933, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Section 102(b)(1) of the JOBS Act exempts EGCs from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that an EGC can elect to opt out of the extended transition period and comply with the requirements that apply to non-EGCs but any such election to opt out is irrevocable. The Company has not elected to opt out of such extended transition period which means that when a financial accounting standard is issued or revised and it has different application dates for public or private companies, the Company, as an EGC, can adopt the new or revised standard at the time private companies adopt the new or revised standard. The Company will be eligible to use this extended transition period under the JOBS Act until the earlier of the 89 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS date it (i) is no longer an EGC or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, the Company’s financial statements may not be comparable to the financial statements of issuers who are required to comply with the effective dates for new or revised accounting standards that are applicable to public companies, which may make comparison of the Company’s financials to those of other public companies more difficult. Management expects to cease to be an EGC on the last day of the Company’s fiscal year following March 8, 2026, which is the fifth anniversary of the date on which Aurora consummated its initial public offering. Recently Adopted Accounting Standards In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , which provides qualitative and quantitative updates to the rate reconciliation and income taxes paid disclosures, among others, in order to enhance the transparency of income tax disclosures, including consistent categories and greater disaggregation of information in the rate reconciliation and disaggregation by jurisdiction of income taxes paid. The Company adopted ASU 2023‑09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, as of January 1, 2025, prospectively. The amendments enhance the transparency of income tax disclosures and did not have a material impact on the Company’s financial statements. Recently Issued Accounting Standards Not Yet Adopted In October 2023, the FASB issued ASU 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative (“ASU 2023-06”). This ASU incorporates certain SEC disclosure requirements into the FASB Accounting Standards Codification (“Codification”). The amendments in the ASU are expected to clarify or improve disclosure and presentation requirements of a variety of Codification Topics, allow users to more easily compare entities subject to the Securities and Exchange Commission’s (the “SEC”) existing disclosures with those entities that were not previously subject to the requirements, and align the requirements in the Codification with the SEC’s regulations. ASU 2023-06 will become effective for each amendment on the effective date of the SEC's corresponding disclosure rule changes. As of December 31, 2024, the Company does not expect ASU 2023-06 will have any impact on the consolidated financial statements. In November 2024, the Financial Accounting Standard Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-03, and in January 2025, ASU 2025-01, Income Statement - Comprehensive Income - Expense Disaggregation Disclosures (subtopic 220-40), which requires disclosure, in the notes to financial statements, of specified information about certain costs and expenses. The ASUs are effective on a prospective basis, with the option for retrospective application, for annual periods beginning after December 15, 2026 and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted for annual financial statements that have not yet been issued. The Company is in the process of assessing the impact the adoption of this guidance will have on the Company’s financial statement disclosures. In September 2025, the FASB issued ASU 2025-06, Intangibles — Goodwill and Other — Internal-Use Softwar e (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software (ASU 2025-06). The ASU replaces the existing stage-based model for capitalizing internal-use software development costs with a principles-based model that begins capitalization when management authorizes and commits to fund a project and it is probable the project will be completed and the software placed into service. The guidance also incorporates website development costs into the internal-use software framework and requires enhanced disclosures related to capitalized costs and amortization. ASU 2025-06 is effective for annual and interim periods beginning after December 15, 2027, with early adoption permitted. The Company is in the process of assessing the impact the adoption of this guidance will have on the Company’s financial statement disclosures. In November 2025, the FASB issued ASU 2025-08, Financial Instruments — Credit Losses (Topic 326): Purchased Loans. The ASU expands the use of the gross up method to certain acquired loans beyond purchased financial assets with credit deterioration. The ASU applies the gross-up method to acquired non-PCD assets that are purchased seasoned loans ultimately eliminating the Day 1 credit loss expense and reducing interest income recognized in subsequent periods. ASU 2025-08 is effective for annual and interim periods beginning after December 15, 2026, with early adoption permitted. The Company is in the process of assessing the impact the adoption of this guidance will have on the Company’s financial statement disclosures. 90 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS In December 2025, the FASB issued ASU No. 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements ("ASU 2025-11"). This ASU improves the navigability of interim disclosure requirements, provides additional guidance on the disclosures required in interim reporting periods, and introduces a principle requiring entities to disclose events occurring since the end of the most recent annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for annual and interim periods beginning after December 15, 2027, with early adoption permitted. The Company is in the process of assessing the impact the adoption of this guidance will have on the Company’s financial statement disclosures. In December 2025, the FASB issued ASU 2025-12, Codification Improvements ("ASU 2025-12"). ASU 2025-12 addresses suggestions received from stakeholders regarding the ASC and makes other incremental improvements to U.S. GAAP. The update represents changes to the Codification that clarify, correct errors in or make other improvements to a variety of topics that are intended to make it easier to understand and apply. ASU 2025-12 is effective for annual and interim periods beginning after December 15, 2026, with early adoption permitted. The Company is in the process of assessing the impact the adoption of this guidance will have on the Company’s financial statement disclosures. 3. Revenues Revenues — The Company disaggregates revenue based on the following revenue streams: Gain on loans, net consisted of the following : Year Ended December 31, (Amounts in thousands) 2025 2024 Gain on sale of loans, net $ 128,209 $ 59,242 Broker revenue 7,118 8,933 Loan repurchase reserve recovery 821 9,923 Total gain on loans, net $ 136,148 $ 78,098 Other revenue consisted of the following: Year Ended December 31, (Amounts in thousands) 2025 2024 International lending revenue $ 5,185 $ 3,999 Insurance services 2,536 3,466 Real estate services 1,896 2,470 Other revenue 1,682 2,953 Total other revenue $ 11,299 $ 12,888 91 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Net interest income consisted of the following: Year Ended December 31, (Amounts in thousands) 2025 2024 Interest income Mortgage interest income $ 28,759 $ 19,839 Interest income on loans held for investment 20,791 2,258 Interest income from investments 10,719 16,893 Total interest income 60,269 38,990 Interest expense Warehouse interest expense ( 20,134 ) ( 11,258 ) Interest expense on customer deposits ( 20,996 ) ( 2,508 ) Other interest expense (1) ( 1,714 ) ( 7,722 ) Total interest expense ( 42,844 ) ( 21,488 ) Total net interest income $ 17,425 $ 17,502 __________________ (1) Primarily consists of interest on Convertible Notes, see Note 13 for more details. 4. Mortgage Loans Held for Sale and Warehouse Lines of Credit The Company has the following outstanding warehouse lines of credit: December 31, (Amounts in thousands) Maturity Facility Size 2025 2024 Funding Facility 1 (1) May 13, 2025 $ — $ — $ 60,747 Funding Facility 2 (2) March 6, 2026 150,000 81,423 74,472 Funding Facility 3 (3) June 30, 2026 175,000 117,499 108,851 Funding Facility 4 (4) April 5, 2026 250,000 212,940 — Total warehouse lines of credit $ 575,000 $ 411,862 $ 244,070 __________________ (1) Interest charged under the facility is at the 30-day term SOFR plus 2.125 %. During the second quarter of 2025, Funding Facility 1 was terminated prior to maturity. (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. Subsequent to December 31, 2025, the Company extended the maturity to March 2, 2027. (3) Interest charged under the facility is at the 30-day term SOFR plus 1.75 % - 3.75 %. A compensating balance of $ 15.0 million is maintained and included in cash and cash equivalents. This amount represents a compensating balance arrangement and is not legally restricted. Failure to maintain the required balance may limit the Company’s ability to obtain future advances under the facility. As of December 31, 2025, the Company was in compliance with this requirement. Subsequent to December 31, 2025, the Company extended the maturity to January 21, 2027. (4) Interest charged under the facility is at the daily simple SOFR plus 1.75 % - 2.50 %. There is no cash collateral deposit maintained as of December 31, 2025. 92 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The unpaid principal amounts of the Company’s LHFS are also pledged as collateral under the relevant warehouse funding facilities. The Company’s LHFS are summarized below by those pledged as collateral and those fully funded by the Company: December 31, (Amounts in thousands) 2025 2024 Funding Facility 1 $ — $ 61,341 Funding Facility 2 89,483 83,562 Funding Facility 3 129,515 123,081 Funding Facility 4 226,822 — Total LHFS pledged as collateral 445,820 267,984 Company-funded LHFS 6,197 10,056 Company-funded HELOC 7,308 118,879 Total LHFS 459,325 396,919 Fair value adjustment 7,356 2,322 Total LHFS at fair value $ 466,681 $ 399,241 Average days loans held for sale, other than Company-funded LHFS and Company-funded HELOC, for the years ended December 31, 2025 and 2024 were approximately 30 days and 21 days, respectively. This is defined as the average days between funding and sale for loans funded during each period. As of December 31, 2025 and 2024, the unpaid principal balance of loans that were either 90 days past due or non-performing was $ 2.4 million and $ 1.4 million, respectively. As of December 31, 2025 and 2024, the weighted average annualized interest rate for the warehouse lines of credit was 6.08 % and 6.44 %, respectively. The warehouse lines of credit contain certain restrictive covenants that require the Company to maintain certain minimum net worth, liquid assets, current ratios, liquidity ratios, leverage ratios, and earnings. In addition, these warehouse lines also require the Company to maintain compensating cash balances. As of December 31, 2025, the Company maintained $ 3.8 million of cash collateral deposits included in restricted cash and $ 15.0 million of compensating balances included in cash and cash equivalents on the accompanying consolidated balance sheets. As of December 31, 2024, the Company maintained $ 18.8 million of cash collateral deposits included in restricted cash. The Company was in compliance with all financial covenants under the warehouse lines as of December 31, 2025 and 2024. 93 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 5. Loans Held for Investment The majority of the Company’s Loans Held for Investment portfolio consists of property - buy to let loans, which is the purchase of property for the purpose of renting to a tenant, which makes up 99.9 % and 98.6 % of the total loan portfolio as of December 31, 2025 and 2024, respectively. The Company’s Loans Held for Investment portfolio is summarized as follows: (Amounts in thousands) December 31, 2025 December 31, 2024 Property - Buy to Let $ 736,807 $ 111,630 Other 544 1,514 Deferred fees, net ( 13,713 ) — Fair value hedge basis adjustment 1,946 — Allowance for credit losses ( 2,251 ) ( 1,667 ) Total Loans Held for Investment, net $ 723,333 $ 111,477 Accrued interest receivable on loans receivable totaled $ 1.0 million and $ 0.4 million, respectively, as of December 31, 2025 and December 31, 2024 and is included in other receivables, net on the consolidated balance sheets. The Company elected the practical expedient to exclude the applicable accrued interest receivable on loans receivable from the disclosed amortized cost basis. The Company concluded that it has a substantive non-accrual policy which allows for the timely reversal of accrued interest should an asset be placed on non-accrual; accordingly, there was no allowance for credit losses for accrued interest receivable on loans receivable as of December 31, 2025. When writing off uncollectible accrued interest receivables on its loans held for investment portfolio, the Company considers 90 days to be a timely manner. Uncollectible amounts of accrued interest receivable are charged off by reversing interest income. The Company had no charge offs of uncollectible accrued interest on its outstanding loans held for investment during the years ended December 31, 2025 and 2024. Loans are considered past due if the required principal and interest payments have not been received as of the date such payments were due. As of December 31, 2025 there was an immaterial number of loans held for investment past due. Substantially all past-due loans were less than 30 days past due. As of December 31, 2024, there were no loans held for investment past due. The Company considers loans for which the repayment is expected to be provided substantially through the operation or sale of collateral and the borrower is experiencing financial difficulty, or where foreclosure is probable, to be collateral dependent. As of December 31, 2025, there was one loan with a total unpaid balance of $ 2.5 million in which formal foreclosure proceedings were in process. As of December 31, 2024, there were no loans secured by any asset type for which formal foreclosure proceedings were in process. Loans are placed on non-accrual status and the accrual of interest is discontinued if principal or interest payments become 90 days past due and/or management deems the collectability of the principal and/or interest to be in question. Loans to a customer whose financial condition has deteriorated are considered for non-accrual status whether or not the loan is 90 days or more past due. Generally, payments received on non-accrual loans are recorded as principal reductions. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. As of December 31, 2025 and 2024, there were no loans that were placed on non-accrual status. During the years ended December 31, 2025 and 2024, there were no modifications for loans to borrowers experiencing financial difficulty. Loans are categorized into risk categories based on relevant information about the ability of borrowers to service their debt, including, but not limited to, current financial information, historical payment experience, credit documentation, public information, and current economic trends. The Company analyzes loans individually by classifying the loans as to credit risk. 94 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS This analysis includes all loans with the exception of homogeneous loans, or loans that are evaluated together in pools of similar loans (i.e., home mortgage loans, home equity lines of credit, overdraft loans, express business loans, and automobile loans). This analysis is performed at least on a quarterly basis. Homogeneous loans are not risk rated and credit risk is analyzed largely by the contractual maturity and payment status of the loan. The Company utilizes maturity bands to assess the probability of credit losses within the portfolio. The three main bands are as follows: 0-20 months, 21-40 months, and over 40 months. The following table presents amortized cost for outstanding loans, by class and year of origination/renewal, as of December 31, 2025 and December 31, 2024. The tables below present loans by credit quality indicator and vintage year. The amounts presented by year of origination exclude fair value hedge accounting basis adjustments and net deferred fees, which are presented separately above: December 31, 2025 (Amounts in thousands) 2025 2024 2023 2022 2021 Prior Total Property - Buy to Let 0-20 Months $ — $ — $ — $ — $ — $ — $ — 21-40 Months — 226 — — — — 226 Over 40 Months 605,424 116,675 769 — — — 722,868 Total $ 605,424 $ 116,901 $ 769 $ — $ — $ — $ 723,094 Other 0-20 Months $ — $ — $ — $ 406 $ 125 $ — $ 531 21-40 Months — — 13 — — — 13 Over 40 Months — — — — — — — Total $ — $ — $ 13 $ 406 $ 125 $ — $ 544 Total $ 605,424 $ 116,901 $ 782 $ 406 $ 125 $ — $ 723,638 December 31, 2024 (Amounts in thousands) 2024 2023 2022 2021 2020 Prior Total Property - Buy to Let 0-20 Months $ — $ — $ — $ — $ — $ — $ — 21-40 Months — — — — — — — Over 40 Months 110,891 739 — — — — 111,630 Total $ 110,891 $ 739 $ — $ — $ — $ — $ 111,630 Other 0-20 Months $ — $ 34 $ 255 $ 435 $ 77 $ 2 $ 803 21-40 Months — 13 630 68 — — 711 Over 40 Months — — — — — — — Total $ — $ 47 $ 885 $ 503 $ 77 $ 2 $ 1,514 Total $ 110,891 $ 786 $ 885 $ 503 $ 77 $ 2 $ 113,144 95 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 6. Property and Equipment Property and equipment consists of the following: As of December 31, (Amounts in thousands) 2025 2024 Computer and Hardware $ 3,267 $ 5,423 Furniture and equipment 1,496 1,580 Leasehold improvements 2,594 2,509 Total property and equipment 7,357 9,512 Less: Accumulated depreciation ( 5,414 ) ( 6,795 ) Property and equipment, net $ 1,943 $ 2,717 Total depreciation expense on property and equipment for the years ended December 31, 2025 and 2024 was $ 1.0 million and $ 7.1 million, respectively. Included in depreciation expense was $ 3.7 million of accelerated depreciation due to a lease modification for the year ended December 31, 2024. An impairment of $ 0.2 million and $ 4.8 million was recognized for the years ended December 31, 2025 and 2024, respectively, related to computers and hardware and is included within other expense/(income) within the consolidated statements of operations and comprehensive loss. 7. Leases The below table presents the lease related assets and liabilities recorded on the accompanying balance sheet: As of December 31, (Amounts in thousands) Balance Sheet Caption 2025 2024 Assets: Operating lease right-of-use assets Right-of-use asset $ 4,678 $ 1,387 Total leased assets $ 4,678 $ 1,387 Liabilities: Operating lease liabilities Lease liabilities $ 4,629 $ 4,081 Total lease liabilities $ 4,629 $ 4,081 The components of operating lease costs, included within general and administrative expenses within the consolidated statements of operations and comprehensive loss, were as follows: Year Ended December 31, (Amounts in thousands) 2025 2024 Operating lease cost $ 3,390 $ 8,903 Short-term lease cost 1,050 512 Variable lease cost 733 906 Total operating lease cost $ 5,173 $ 10,321 Supplemental cash flow and non-cash information related to leases were as follows: Year Ended December 31, (Amounts in thousands) 2025 2024 Cash paid for amounts included in measurement of operating lease liabilities $ 4,845 $ 8,668 Right-of-use assets obtained in exchange for lease liabilities: Operating lease right-of-use assets recognized $ 4,996 $ 1,261 96 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Supplemental balance sheet information related to leases was as follows: Year Ended December 31, (Amounts in thousands) 2025 2024 Operating leases Weighted average remaining lease term (in years) 3.8 1.3 Weighted average discount rate 10.0 % 5.4 % As of December 31, 2025, the Company held no finance leases, and the maturity analysis of operating lease liabilities are as follows: (Amounts in thousands) Operating Leases 2026 $ 1,781 2027 1,405 2028 1,105 2029 1,088 2030 and beyond 147 Total lease payments 5,526 Less amount representing interest ( 897 ) Total lease liabilities $ 4,629 8. Goodwill and Internal Use Software and Other Intangible Assets, Net Changes in the carrying amount of goodwill, net consisted of the following: Year Ended December 31, (Amounts in thousands) 2025 2024 Balance at beginning of year $ 23,615 $ 32,390 Goodwill impairment ( 14,000 ) ( 7,266 ) Reclassification of disposal units goodwill to assets held for sale — ( 1,112 ) Effect of foreign currency exchange rate changes 1,380 ( 397 ) Balance at end of year $ 10,995 $ 23,615 For the years ended December 31, 2025 and 2024, the Company recorded goodwill impairment charges of $ 14.0 million and $ 7.3 million, respectively, which are included within other expense/(income) in the consolidated statements of operations and comprehensive loss. During the fourth quarter of 2025, management identified a triggering event requiring an interim goodwill impairment assessment. The Company determined that the estimated fair value of Birmingham Bank was less than its carrying value and, as a result, recorded a goodwill impairment charge of $ 13.5 million during the year ended December 31, 2025. The remaining impairment of $ 0.5 million recorded in 2025 relates to entities in the U.K. for which management has classified as held for sale, and the $ 7.3 million impairment recorded in 2024 similarly relates to those held-for-sale U.K. entities, see Note 10. 97 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Internal use software and other intangible assets, net consisted of the following: As of December 31, 2025 (Amounts in thousands, except useful lives) Weighted Average Useful Lives (in years) Gross Carrying Value Accumulated Amortization Net Carrying Value Intangible assets with finite lives Internal use software and website development 3.4 $ 161,622 $ ( 142,069 ) $ 19,553 Intellectual property and other 5.5 2,626 ( 2,048 ) $ 578 Total Intangible assets with finite lives, net 164,248 ( 144,117 ) 20,131 Intangible assets with indefinite lives Domain name 1,820 — $ 1,820 Licenses and other 34 — $ 34 Total Internal use software and other intangible assets, net $ 166,102 $ ( 144,117 ) $ 21,985 As of December 31, 2024 (Amounts in thousands, except useful lives) Weighted Average Useful Lives (in years) Gross Carrying Value Accumulated Amortization Net Carrying Value Intangible assets with finite lives Internal use software and website development 3.0 $ 147,994 $ ( 129,487 ) $ 18,507 Intellectual property and other 6.0 869 ( 291 ) 578 Total Intangible assets with finite lives, net 148,863 ( 129,778 ) 19,085 Intangible assets with indefinite lives Domain name 1,820 — 1,820 Licenses and other 31 — 31 Total Internal use software and other intangible assets, net $ 150,714 $ ( 129,778 ) $ 20,936 The Company capitalized $ 11.4 million and $ 8.5 million in internal use software and website development costs during the years ended December 31, 2025 and 2024, respectively. Included in capitalized internal use software and website development costs are $ 1.4 million and $ 1.8 million of stock-based compensation costs for the years ended December 31, 2025 and 2024, respectively. Amortization expense totaled $ 13.0 million and $ 26.1 million during the years ended December 31, 2025 and 2024, respectively. For the years ended December 31, 2025 and 2024, no impairments were recognized relating to other intangible assets. Amortization expense related to intangible assets as of December 31, 2025 is expected to be as follows: (Amounts in thousands) Total 2026 $ 9,695 2027 6,336 2028 2,926 2029 808 2030 and thereafter 366 Total $ 20,131 98 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 9. Prepaid Expenses and Other Assets Prepaid expenses and other assets consisted of the following: As of December 31, (Amounts in thousands) 2025 2024 Prepaid expenses $ 12,495 $ 17,165 Tax receivables 6,242 5,484 Security deposits 8,803 11,245 Prefunded loans in escrow 352 — Total prepaid expenses and other assets $ 27,892 $ 33,894 The prefunded loans in escrow consist of loans that were funded in the current period but closed in the subsequent period. Due to the timing of the closing of these loans, they are not mortgage loans held for sale in the current period. 10. Assets and Liabilities Held for Sale During the fourth quarter of 2024, management enacted a plan to sell several entities in the U.K. which are being actively marketed, are available for sale in their current respective conditions, and management expects to complete the respective sales within one year and all criteria included in Note 2 have been met. The following table represents summarized balance sheet information of assets and liabilities held for sale: (Amounts in thousands) December 31, 2025 December 31, 2024 Cash and cash equivalents $ 710 $ 3,814 Restricted cash 4,256 3,868 Mortgage loans held for sale, at fair value 1,954 1,721 Other receivables, net 706 1,244 Property and equipment, net 2 35 Internal use software and other intangible assets, net 2,357 2,203 Goodwill 711 1,112 Prepaid expenses and other assets 69 634 Write down of assets to fair value less cost to sell ( 2,078 ) ( 4,220 ) Total assets held for sale $ 8,687 $ 10,411 Accounts payable and accrued expenses $ 424 $ 1,684 Escrow payable and other customer accounts 4,256 3,868 Other liabilities 122 564 Total liabilities held for sale $ 4,802 $ 6,116 For the years ended December 31, 2025 and 2024, the Company recorded a write up of $ 2.1 million and a write down of $ 4.2 million, respectively, to adjust the disposal group of its fair value less cost to sell. These amounts are included in other expense (income) in the consolidated statements of operations and comprehensive loss. For year ended December 31, 2025, the Company recorded goodwill impairment relating to the entities in the U.K. classified as held for sale of $ 0.5 million which is included within other expense/(income) in the consolidated statements of operations and comprehensive loss. During the third quarter of 2025, the Company completed the sale of its Trussle Lab Ltd subsidiary, which had previously been classified as held for sale. In connection with the transaction, and pursuant to a settlement agreement executed in September 2025 between Better Finance Ltd (a subsidiary of the Company) and Onedome Finance Ltd, the Company paid $ 1.6 million (€ 1.2 million) to transfer ownership and settle all related obligations associated with the entity. 99 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS As a result of this transaction, the Company recognized a loss on disposal of $ 0.7 million (€ 0.5 million), which is included within other expense/(income) in the consolidated statements of operations and comprehensive loss. 11. Customer Deposits In relation to the Company’s banking activities tied to the Birmingham acquisition in the U.K., the Company offers individual savings accounts and other depository products with differing maturities and interest rates to its customers. The balance of customer deposits as of December 31, 2025 and December 31, 2024 was $ 763.0 million and $ 134.1 million, respectively, on the consolidated balance sheets. The following table presents average balances and weighted average rates paid on deposits for the years indicated: Year Ended December 31, 2025 Year Ended December 31, 2024 (Amounts in thousands) Average Balance Average Rate Paid Average Balance Average Rate Paid Notice $ 107,685 3.75 % $ 10,405 2.94 % Term 384,051 4.53 % 44,970 3.94 % Savings 2,588 2.39 % 3,285 2.11 % Total Deposits $ 494,324 3.56 % $ 58,660 3.00 % The following table presents maturities of customer deposits: (Amounts in thousands) As of December 31, 2025 Demand Deposits $ 182,392 Maturing In: 2026 144,445 2027 186,947 2028 117,480 2029 31,679 Thereafter 100,041 Total 762,984 Interest Expense on deposits is recorded in interest expense in the consolidated statements of operations and comprehensive loss for the year indicated as follows: Year Ended December 31, (Amounts in thousands) 2025 2024 Notice $ 4,441 $ 460 Term 16,499 1,946 Savings 56 102 Total Interest Expense $ 20,996 $ 2,508 Deposits are for U.K. banking clients and are protected up to £ 120.0 thousand ($ 161.3 thousand) per eligible person by the Financial Services Compensation Scheme in the U.K. Of the total customer deposits as of December 31, 2025, $ 214.3 million were over the applicable insured amount. 100 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 12. Other Liabilities Other liabilities consisted of the following: As of December 31, (Amounts in thousands) 2025 2024 Deferred Revenue — 3,038 Loan Repurchase Reserve (Note 16) 4,268 7,523 Other Liabilities 2,265 2,905 Total other liabilities $ 6,533 $ 13,466 13. Senior Notes Convertible Note (Prior to exchange) — As of December 31, 2025 and 2024, the carrying amount of the Convertible Note was none and $ 519.7 million on the consolidated balance sheets, respectively. For the years ended December 31, 2025 and 2024, the Company recorded a total of $ 1.7 million and $ 7.6 million, respectively, of interest expense related to the Convertible Note. Interest expense from the Convertible Note is included in interest expense within the consolidated statements of operations and comprehensive loss. In February 2024, the Company made a cash payment in the amount of $ 2.5 million, which consisted of $ 1.1 million towards the principal and $ 1.4 million of interest from January 1, 2024 through February 15, 2024. Note Exchange Agreement and Troubled Debt Restructuring — On April 12, 2025, the Company entered into a privately negotiated Exchange Agreement (the “Note Exchange Agreement”) with SB Northstar LP (the “Investor”), a related party, pursuant to which the Company and the Investor agreed to exchange (the “Exchange”) all of the $ 532.5 million total aggregate principal amount outstanding of the Company’s existing 1.00 % Convertible Notes due 2028 (the “Convertible Notes”) held by the Investor for (i) $ 155.0 million in aggregate principal amount of new 6.00 % Senior Secured Notes due 2028 (the “Senior Notes”), and (ii) a cash payment of $ 110.0 million (the “Cash Payment”). The Company did not receive any cash proceeds in connection with the Exchange. The Exchange was subsequently consummated on April 28, 2025 (the “Closing Date”), upon which the Company received and cancelled all Convertible Notes and the Investor forfeited any accrued and unpaid interest in respect of the Convertible Notes to, but not including, the Closing Date. Pursuant to the Note Exchange Agreement, the Company granted the Investor, conditioned on closing of the Exchange, a non-transferrable right to designate one non-voting board observer from June 1, 2025, for so long as the Investor and affiliates of the Investor continue to hold, in the aggregate, either (i) at least 25 % of the initial aggregate principal amount of the Senior Notes or (ii) at least 12 % of the sum of the outstanding shares of the Company’s Class A common stock, Class B common stock and Class C common stock, calculated on a fully diluted basis. The Exchange was accounted for as a TDR under ASC 470-60. On the Closing Date, the principal amount was $ 532.5 million with a discount of $ 11.1 million for a net carrying value of $ 521.4 million. The Company made a cash payment on the Closing Date of $ 110.0 million and recognized the Senior Notes at a carrying value $ 200.4 million. The gain on troubled debt restructuring of $ 210.0 million was recognized through equity as the Investor is considered a related party. The Company also accrued for $ 1.0 million of expenses related to the TDR which reduced the gain recognized through equity. Under the TDR accounting treatment, the initial carrying value of the Senior Notes of $ 200.4 million is made up of the total future undiscounted cash flows which includes principal of $ 155.0 million and interest make-whole as well as a redemption premium of $ 45.4 million . The interest make-whole and the redemption premium are related to the optional redemption feature where the Company can redeem all or part of the Senior Notes prior to December 31, 2028 at 108 % of the principal plus a make-whole premium as discussed further below. The Company assumes contingent future payments will have to be paid and those amounts shall be included in the total future cash payments. Senior Notes —In connection with the Exchange, the Company entered into an indenture (the “Senior Notes Indenture”) with GLAS Trust Company LLC, as trustee and notes collateral agent. As of December 31, 2025 and 2024, the carrying amount of the Senior Notes was $ 198.8 million and none , respectively. In July 2025, the Company made a cash 101 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS payment of $ 1.6 million which consisted of interest from April 28, 2025 through June 30, 2025. As a result of the accounting treatment discussed above, this payment was applied to reduce the principal on the Senior Notes. For the period July 1, 2025 through December 31, 2025, t he Company has elected to pay interest in kind on the Senior Notes. The Senior Notes represent the Company’s senior secured obligations, and are secured by substantially all of the Company’s and its material domestic subsidiaries’ assets. The Senior Notes are (i) senior in right of payment to the Company’s existing and future senior, unsecured indebtedness to the extent of the value of the collateral; and (ii) senior in right of payment to the Company’s existing and future indebtedness that is expressly subordinated to the Senior Notes. Interest on the Senior Notes is payable, at the Company’s election, in cash or by payment-in-kind by issuing additional notes in an aggregate principal amount equal to the relevant amount of interest paid in kind. The Senior Notes will accrue interest at a rate of 6.00 % per annum, payable semi-annually in arrears on June 30 and December 31 of each year, beginning on June 30, 2025. The Senior Notes will mature on December 31, 2028. The Senior Notes are redeemable, in whole and not in part, at the Company’s option at any time prior to December 31, 2028, at a cash redemption price equal to 106.00 % of the principal amount of the Senior Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date, with an amount not exceeding the net cash proceeds of one or more “Equity Offerings” (as defined in the Senior Notes Indenture); provided that at least 60 % of the aggregate principal amount of the Senior Notes remains outstanding immediately after the redemption and the redemption occurs within 150 days of the date of the closing of each such Equity Offering. Additionally, prior to December 31, 2028, the Company may redeem all or part of the Senior Notes at a redemption price equal to the sum of 108 % of the principal amount of the Senior Notes to be redeemed, plus the “Make Whole Premium” (as defined in the Senior Notes Indenture) at the redemption date, plus accrued and unpaid interest, if any, to, but excluding, the redemption date. If certain corporate events that constitute a “Change of Control Triggering Event” (as defined in the Senior Notes Indenture) occur, then noteholders may require the Company to repurchase all or any part of their Senior Notes at a cash repurchase price equal to 101 % of the aggregate principal amount of the Senior Notes to be repurchased, plus accrued and unpaid interest, if any, to the date of settlement. The definition of Change of Control Triggering Event includes certain business combination transactions involving the Company. 14. Related Party Transactions The Company has entered into a number of commercial agreements with related parties, which management believes provide the Company with products or services that are beneficial to its commercial objectives. Often these products and services have been tailored to the Company’s specific needs or are part of new pilot programs, both for the Company and the counterparty, for which there are not clear alternative vendors offering comparable services to compare pricing with. It is reasonable to assume that none of these related party commercial agreements were structured at arm’s length and therefore may be beneficial to the counterparty. TheNumber —The Company originally entered into a data analytics services agreement in August 2016 with TheNumber, LLC (“TheNumber”), an entity affiliated with both Vishal Garg, the Chief Executive Officer of the Company, and 1/0 Real Estate. In September 2021, the Company and TheNumber entered into a technology integration and license agreement. The listed services provided by TheNumber are lead generation, market rate analysis, lead growth analysis, property listing analysis, automated valuation models, and financial risk analysis. Both parties agreed to jointly develop all aspects of this program, and the agreement provides for the utilization of TheNumber employees by the Company. In January 2025, the agreement was extended for an additional year. The services provided by TheNumber are not integral to the Company’s technology platform and amounts incurred are not material to the Company. In connection with these agreements, the Company paid expenses of $ 0.9 million and $ 1.0 million for the years ended December 31, 2025 and 2024 respectively, which are included within general and administrative expenses on the consolidated statements of operations and comprehensive loss. The Company included a payable of $ 0.1 million and $ 0.1 million as of December 31, 2025 and 2024, respectively, within accounts payable and accrued expenses on the consolidated balance sheets. Notable —In previous years, the Company or subsidiaries of the Company, entered into several agreements (herein referred to as the “Notable Agreements”) with Notable Finance LLC (“Notable”), an entity in which Vishal Garg, the Company’s Chief Executive Officer, and 1/0 Real Estate (an entity affiliated with Vishal Garg), collectively hold a 102 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS majority ownership interest. The Notable Agreements included products such as a consumer lending program, a non-revolving personal line of credit, and other financial products which were offered to borrowers of the Company. The Notable Agreements also included the ability for the Company to purchase up to $ 20.0 million of unsecured home improvement loans underwritten and originated by Notable for the Company’s customers. During 2024, the Company decided to cease offering the products and services provided via the Notable Agreements. As of December 31, 2025 and 2024, the Company had $ 2.5 million and $ 4.2 million of unsecured home improvement loans purchased from Notable, which are included within mortgage loans held for sale, at fair value on the consolidated balance sheets. Notable will continue to provide servicing for the loans purchased from Notable that remain on the Company’s consolidated balance sheet. Other Related Party Services —The Company has relationships with 1/0 Capital LLC and Zethos Inc. (doing business as “True Work”), companies affiliated with Vishal Garg, the Company’s Chief Executive Officer, which provide services to the Company varying from data analytics to information technology support services. For the years ended December 31, 2025 and 2024, the Company recorded an immaterial amount and $ 0.1 million, respectively, in relation to these services, which are included in general and administrative expenses on the consolidated statements of operations and comprehensive loss. The Company included a payable of an immaterial amount for both the years ended December 31, 2025 and 2024, within accounts payable and accrued expenses on the consolidated balance sheets. RSU Grants for Consulting Services— In November 2025, the Company granted restricted stock units (“RSUs”), which vest only upon the satisfaction of certain performance- and time-based vesting conditions, to Prabhu Narasimhan and Harit Talwar, members of the Company’s Board of Directors, in consideration for consulting services provided to the Company. The consulting services were provided outside of, and in addition to, their duties as members of the Board of Directors. The RSU grants were approved by the Audit Committee of the Board of Directors and were not issued as compensation for board membership. The consulting services provided by Messrs. Talwar and Narasimhan relate to strategic advisory and other operational initiatives of the Company. Management believes the services provided by Messrs. Talwar and Narasimhan are beneficial to the Company’s commercial and strategic objectives. In connection with these RSU grants, the Company recognized share-based compensation expense of $ 0.7 million for the year ended December 31, 2025, which is included within compensation and benefits on the consolidated statements of operations and comprehensive loss. Note Exchange Agreement —See Note 13, for further details on the Exchange with SB Northstar LP, a related party of the Company. 15. Commitments and Contingencies Litigation —The Company, among other things, engages in mortgage lending, title and settlement services, and other financial technology services. The Company operates in a highly regulated industry and may be subject to various legal and administrative proceedings concerning matters that arise in the normal and ordinary course of business, including inquiries, complaints, audits, examinations, investigations, employee labor disputes, and potential enforcement actions from regulatory agencies. While the ultimate outcome of these matters cannot be predicted with certainty due to inherent uncertainties in litigation, management accrues for losses when they are probable to occur and such losses are reasonably estimable, and discloses pending litigation if the Company believes a possibility exists that the litigation will have a material effect on its financial results. Legal costs expected to be incurred are accounted for as they are incurred. The Company is currently a party to pending legal claims and proceedings regarding employee related labor disputes initiated in the third quarter of 2020. The disputes allege that the Company has failed to pay certain employees for overtime and is in violation of the Fair Labor Standards Act and labor laws in the State of California. The majority of such legal claims and proceedings are in the early stages and, to the extent applicable, have not yet reached the class certification stage and as such the ultimate outcomes cannot be predicted with certainty due to inherent uncertainties in the legal claims and proceedings. As part of the disputes and other similar types of legal matters, the Company included an estimated liability of $ 6.7 million and $ 8.3 million as of December 31, 2025 and 2024, respectively, which is included in accounts payable and accrued expenses on the consolidated balance sheets. During the year ended December 31, 2025, the changes in the liability included settlements of $ 1.4 million as well as a reduction in accruals of $ 0.2 million related to certain other employment matters, which were included within general and administrative expense on the consolidated statement of operations and comprehensive loss. During the year ended December 31, 2024, the changes in liability included settlements 103 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS of $ 0.5 million as well as additional accruals of $ 0.4 million related to certain other employment matters, which were included within general and administrative expense on the consolidated statement of operations and comprehensive loss. Regulatory Matters —In the third quarter of 2021, following third-party audits of samples of loans produced during the fiscal years 2018, 2019, and 2021, the Company became aware of certain TILA-RESPA Integrated Disclosure (“TRID”) defects in the loan production process that resulted in the final closing costs disclosed in the closing disclosure, in some instances, being greater than those disclosed in the loan estimate. Some of these defects were outside applicable tolerances under the TRID rule, which resulted in potential overcharges to consumers. As of December 31, 2025 and 2024, the Company included an estimated liability of $ 5.1 million and $ 6.6 million, respectively, within accounts payable and accrued expenses on the consolidated balance sheets. For the year ended December 31, 2025, the Company recorded a reduction in the accruals for these potential TRID defects of $ 0.7 million which is included within loan origination expense in the consolidated statement of operations and comprehensive loss. During the year ended December 31, 2025, the Company had relief of the liability due to payments to customers in the amount of $ 0.8 million. For the year ended December 31, 2024, the Company recorded additional accruals for these potential TRID defects in the amount of $ 0.3 million and is included within loan origination expense in the consolidated statement of operations and comprehensive loss. This accrual is the Company’s best estimate of potential exposure on the larger population of loans based on the results obtained by the audited sample. The accrued amounts are for estimated refunds potentially due to consumers for TRID tolerance errors for loans produced with the identified defects. The Company is continuing to remediate TRID tolerance defects as necessary. During the year ended December 31, 2024, the Company had relief of the liability due to payments to customers in the amount of $ 2.3 million. Loan Commitments —The Company enters into IRLCs to fund mortgage loans, at specified interest rates and within a specified period of time, with potential borrowers who have applied for a loan and meet certain credit and underwriting criteria. As of December 31, 2025 and 2024, the Company had outstanding commitments to fund mortgage loans in notional amounts of approximately $ 271.4 million and $ 129.9 million, respectively. The IRLCs derived from those notional amounts are recorded within derivative assets and liabilities, at fair value as of December 31, 2025 and 2024, respectively, on the consolidated balance sheets. See Note 18. Forward Sale Commitments —In the ordinary course of business, the Company enters into contracts to sell existing LHFS or loans committed but yet to be funded into the secondary market at specified future dates. As December 31, 2025 and 2024, the Company had outstanding forward sales commitment contracts of notional amounts of approximately $ 286.0 million and $ 158.0 million, respectively. The forward sales commitments derived from those notional amounts are recorded within derivative assets and liabilities, at fair value as of December 31, 2025 and 2024, respectively, on the consolidated balance sheets. See Note 18. Concentrations —See below for areas considered to be concentrations of credit risk for the Company: Significant loan purchasers are those which represent more than 10% of the Company’s loan volume. During the year ended December 31, 2025, the Company had two loan purchasers that accounted for 35 % and 13 % of loans sold by the Company. During the year ended December 31, 2024, the Company had three loan purchasers that accounted for 37 %, 26 %, and 19 %, respectively, of loans sold by the Company. Concentrations of credit risk associated with the LHFS carried at fair value are limited due to the large number of borrowers and their dispersion across many geographic areas throughout the United States. As of December 31, 2025 and 2024, the Company had originated 12 % and 10 %, respectively, of its LHFS secured by properties in California. The Company maintains cash and cash equivalent balances at various financial institutions. Cash accounts at each bank are insured by the Federal Deposit Insurance Corporation for amounts up to $0.25 million. As of December 31, 2025 and 2024, the majority of the Company’s cash and cash equivalent balances are in excess of the insured limits at various financial institutions. Escrow Payable and Other Customer Accounts —In accordance with its lender obligations, the Company maintains a separate escrow bank account to hold borrower funds pending future disbursement. The Company administers escrow deposits representing undisbursed amounts received for payment of property taxes, insurance and principal, and interest on mortgage loans held for sale. The Company also administers customer deposits in relation to other non-mortgage products and services that the Company offers. These funds are shown as restricted cash and there is a corresponding escrow payable on the consolidated balance sheet, as they are being held on behalf of the borrower or customer. The balance in 104 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS these accounts as of December 31, 2025 and 2024 was $ 0.2 million and $ 0.1 million, respectively, and are included within escrow payable and other customer accounts on the consolidated balance sheets. 16. Risks and Uncertainties In the normal course of business, companies in the mortgage lending industry encounter certain economic and regulatory risks. Economic risks include credit risk and interest rate risk, in either a rising or declining interest rate environment. Credit risk is the risk of default that may result from the borrowers’ inability or unwillingness to make contractually required payments during the period in which loans are being held for sale by the Company. Interest Rate Risk —The Company is subject to interest rate risk in a rising interest rate environment, as the Company may experience a decrease in loan production, as well as decreases in the fair value of LHFS, loan applications in process with locked-in rates, and commitments to originate loans, which may negatively impact the Company’s operations. To preserve the value of such fixed-rate loans or loan applications in process with locked-in rates, agreements are executed for best effort or mandatory loan sales to be settled at future dates with fixed prices. These loan sales take the form of short-term forward sales of mortgage-backed securities and commitments to sell loans to loan purchasers. Alternatively, in a declining interest rate environment, customers may withdraw their loan applications that include locked-in rates with the Company. Additionally, when interest rates decline, interest income received from LHFS will decrease. The Company uses an interest rate hedging program to manage these risks. Through this program, mortgage-backed securities are purchased and sold forward. For all counterparties with open positions as of December 31, 2025, in the event that the Company does not deliver into the forward-delivery commitments, they can be settled on a net basis. Net settlements entail paying or receiving cash based upon the change in market value of the existing instrument. The Company currently uses forward sales of mortgage-backed securities, interest rate commitments from borrowers, and mandatory and/or best-efforts forward commitments to sell loans to loan purchasers to protect the Company from interest rate fluctuations. These short-term instruments, which do not require any payments to be paid to the counterparty in connection with the execution of the commitments, are generally executed simultaneously. Credit Risk —The Company’s mortgage pipeline hedging activities, which include forward sales of mortgage-backed securities and commitments to sell loans, are not designated as hedging instruments for accounting purposes under ASC 815 and are recorded at fair value through earnings. These activities are designed to economically offset interest rate risk associated with mortgage loans held for sale and interest rate lock commitments. Separately, the Company designates certain interest rate swaps as fair value hedges under ASC 815 to manage interest rate risk associated with loans held for investment. The Company’s derivative transactions contain an element of counterparty credit risk because counterparties may be unable to meet their obligations. While the Company does not anticipate nonperformance by any counterparty, it is exposed to potential credit losses in the event of default. The Company’s exposure in the event of counterparty default is generally limited to the difference between the contract value and the current market value of the instrument. The Company mitigates this risk by transacting with well-established financial institutions that meet established credit and capital guidelines. Loan Repurchase Reserve —The Company sells loans to loan purchasers without recourse. As such, the loan purchasers have assumed the risk of loss or default by the borrower. However, the Company is usually required by these loan purchasers to make certain standard representations and warranties relating to the loan for up to three years post sale. To the extent that the loans performance does not comply with such representations, or there are early payment defaults, the Company may be required to repurchase the loans or indemnify these loan purchasers for losses. In addition, if loans pay-off within a specified time frame the Company may be required to refund a portion of the sales proceeds to the loan purchasers. The Company repurchased $ 11.9 million ( 47 loans) and $ 9.9 million ( 30 loans) in unpaid principal balance of loans during the years ended December 31, 2025 and 2024, respectively related to its loan repurchase obligations. The Company’s loan repurchase reserve is included within other liabilities on the consolidated balance sheets. The recovery of 105 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS the loan repurchase reserve is included within gain on loans, net on the consolidated statements of operations and comprehensive loss. The following presents the activity of the Company’s loan repurchase reserve: Year Ended December 31, (Amounts in thousands) 2025 2024 Loan repurchase reserve at beginning of year $ 7,523 $ 19,472 Recovery ( 821 ) ( 9,923 ) Charge-offs ( 2,434 ) ( 2,026 ) Loan repurchase reserve at end of year $ 4,268 $ 7,523 Borrowing Capacity —The Company funds the majority of mortgage loans on a short-term basis through committed and uncommitted warehouse lines as well as from operations for any amounts not advanced by warehouse lenders, see Note 4. As a result, the Company’s ability to fund current operations depends on its ability to secure these types of short-term financings. If the Company’s principal lenders decided to terminate or not to renew any of the warehouse lines with the Company, the loss of borrowing capacity could be detrimental to the Company’s consolidated financial statements unless the Company found a suitable alternative source. 17. Net Loss Per Share The computation of net loss per share and weighted average shares of the Company's common stock outstanding during the periods presented is as follows: Year Ended December 31, (Amounts in thousands, except for share and per share amounts) 2025 2024 Basic and diluted net loss per share: Net loss $ ( 165,872 ) $ ( 206,290 ) Shares used in computation: Weighted average common shares outstanding 15,358,433 15,111,701 Weighted-average effect of dilutive securities: Diluted weighted-average common shares outstanding 15,358,433 15,111,701 Earnings (loss) per share attributable to common stockholders: Basic $ ( 10.80 ) $ ( 13.65 ) Diluted $ ( 10.80 ) $ ( 13.65 ) Basic and diluted loss per share are the same for each class of common stock (i.e., Class A, Class B and Class C) because they are entitled to the same dividend rights. Basic and diluted loss per share are presented together as the amounts for basic and diluted loss per share are the same (i.e., the Company’s other equity-linked instruments outstanding are anti-dilutive for the periods presented). The Company's potentially dilutive securities, which include stock options, RSUs, warrants to purchase shares of common stock, and Sponsor locked-up shares, have been excluded from the computation of diluted net loss per share, as the effect would be anti-dilutive. The Company excluded the following securities, presented based on amounts outstanding 106 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS at each period end, from the computation of diluted net loss per share attributable to common stockholders for the periods indicated as including them would have had an anti-dilutive effect: Year Ended December 31, (Amounts in thousands) 2025 2024 RSUs and Options to purchase common stock (1) 2,534 1,145 Public warrants (1)(2) 6,075 6,075 Private warrants (1)(2) 3,733 3,733 Sponsor locked-up shares (1) 14 14 Total 12,356 10,967 __________________ (1) Securities have an antidilutive effect under the treasury stock method. (2) Public and Private warrants are unadjusted by the Reverse Stock Split as a holder must exercise 50 warrants to receive one share of common stock. 18. Fair Value Measurements The Company’s financial instruments measured at fair value on a recurring basis are summarized below: December 31, 2025 (Amounts in thousands) Level 1 Level 2 Level 3 Total Mortgage loans held for sale, at fair value $ — $ 466,681 $ — $ 466,681 Derivative assets, at fair value (1) — — 4,210 4,210 Total Assets $ — $ 466,681 $ 4,210 $ 470,891 Derivative liabilities, at fair value (1) $ — $ 2,181 $ 250 $ 2,431 Warrants and equity related liabilities, at fair value (2) 668 808 — 1,476 Total Liabilities $ 668 $ 2,989 $ 250 $ 3,907 December 31, 2024 (Amounts in thousands) Level 1 Level 2 Level 3 Total Mortgage loans held for sale, at fair value — 399,241 — 399,241 Derivative assets, at fair value (1) — 1,231 1,308 2,539 Total Assets $ — $ 400,472 $ 1,308 $ 401,780 Derivative liabilities, at fair value (1) —included within other liabilities $ — $ — $ 86 $ 86 Warrants and equity related liabilities, at fair value (2) 729 678 — 1,407 Total Liabilities $ 729 $ 678 $ 86 $ 1,493 __________________ (1) As of December 31, 2025, derivative assets represent IRLCs, and liabilities represent forward sale commitments, IRLCs and interest rate swaps. As of December 31, 2024, derivative assets represent forward sale commitments and IRLCs, and liabilities represent IRLCs. (2) Fair value is based on the intrinsic value of the Company’s underlying stock price at each balance sheet date and includes certain assumptions with regard to volatility. Specific valuation techniques and inputs used in determining the fair value of each significant class of assets and liabilities are as follows: Mortgage Loans Held for Sale— The Company originates certain LHFS to be sold to loan purchasers and elected to carry these loans at fair value in accordance with ASC 825. The fair value is primarily based on the price obtained for other mortgage loans with similar characteristics. The changes in fair value of these assets are largely driven by changes in interest rates subsequent to loan funding and receipt of principal payments associated with the relevant LHFS. 107 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Derivative Assets and Liabilities— The Company uses derivatives to manage various financial risks. The fair values of derivative instruments are determined based on quoted prices for similar assets and liabilities, dealer quotes, and internal pricing models that are primarily sensitive to market observable data. The Company utilizes IRLCs and forward sale commitments. The fair value of IRLCs, which are related to mortgage loan commitments, is based on quoted market prices, adjusted by the pull-through factor, and includes the value attributable to the net servicing fee. The Company evaluated the significance and unobservable nature of the pull-through factor and determined that the classification of IRLCs should be Level 3 as of December 31, 2025 and 2024. Significant changes in the pull-through factor of the IRLCs, in isolation, could result in significant changes in the IRLCs’ fair value measurement. The value of IRLCs also rises and falls with changes in interest rates; for example, entering into interest rate lock commitments at low interest rates followed by an increase in interest rates in the market, will decrease the value of IRLC. The Company had issuances of approximately $ 39.2 million and $ 19.7 million of IRLCs during the years ended December 31, 2025 and 2024, respectively. The number of days from the date of the IRLC to expiration of the rate lock commitment outstanding as of December 31, 2025 and 2024 was approximately, on average, 44 days and 54 days, respectively. The Company attempts to match the maturity date of the IRLCs with the forward commitments. Derivatives are presented in the consolidated balance sheets under derivative assets, at fair value and derivative liabilities, at fair value. During the year ended December 31, 2025, the Company recognized $ 2.8 million of gains and $ 6.2 million of losses related to changes in the fair value of IRLCs and forward sale commitments, respectively. During the year ended December 31, 2024, the Company recognized $ 0.5 million of losses and $ 5.2 million of gains related to changes in the fair value of IRLCs and forward sale commitments, respectively. Gains and losses related to changes in the fair value of IRLCs and forward sale commitments are included in gain on loans, net within the consolidated statements of operations and comprehensive loss. Unrealized activity related to changes in the fair value of forward sale commitments were $ 2.5 million of losses and $ 5.7 million of gains, included in the $ 6.2 million of losses and $ 5.2 million of gains, during the years ended December 31, 2025 and 2024, respectively. In order to manage interest rate risk on our Loans Held for Investment portfolio, we entered into pay-fixed, receive-floating interest rate swap contracts to hedge against exposure to changes in the fair value of Loans Held for Investment resulting from changes in interest rates. The interest rate swaps are carried at fair value on a recurring basis and the fair value is estimated using market observable inputs such as interest rate yield curves and discount rates. We also consider counter-party credit risk in valuing our derivatives. During the year ended December 31, 2025, the Company recognized $ 0.2 million of losses related to changes in the fair value of interest rate swaps. The notional and fair value of derivative financial instruments were as follows: (Amounts in thousands) Notional Value Derivative Asset Derivative Liability Balance as of December 31, 2025 Derivatives not designated as hedging instruments: IRLCs $ 271,373 $ 4,210 $ 250 Forward commitments $ 286,000 — 554 $ 4,210 $ 804 Derivatives designated as hedging instruments: Interest rate swaps $ 268,768 $ — $ 1,627 Total $ 4,210 $ 2,431 Balance as of December 31, 2024 Derivatives not designated as hedging instruments: IRLCs $ 129,900 $ 1,308 $ 86 Forward commitments $ 158,000 1,231 — Total $ 2,539 $ 86 108 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Derivatives Designated as Hedging Instruments— The Company designates these interest rate swap contracts as fair value hedges that qualify for hedge accounting under ASC 815, Derivatives and Hedging . We elected to account for the fair value hedges using the portfolio layer method in accordance with ASU 2022-01. We record the interest rate swaps in the line item "Derivative liabilities, at fair value" on our consolidated balance sheet. For qualifying fair value hedges, both the changes in the fair value of the derivative and the portion of the fair value adjustments associated with the portfolio layer attributable to the hedged risk are recognized into earnings as they occur. Derivative amounts impacting earnings are recognized consistent with the classification of the hedged item in the line item "Loans Held for Investment " as part of interest income, a component of consolidated net income. During the year ended December 31, 2025, the Company recognized $ 0.1 million in interest income on the fair value hedge interest rate swaps. In the fiscal year ended December 31, 2025, fair value hedging transactions were executed in which approximately $ 269 million notional pay -fixed interest rate swaps were consummated with maturities of approximately five years , wherein the Company pays a weighted average fixed rate of approximately 3.7 % and receives daily interest based on the Sterling Overnight Index Average (“SONIA”). Warrant and equity related liabilities— The warrant liability consists of Warrants and certain shares issued to Novator Capital Sponsor Ltd. (the "Sponsor”), a related party, that are subject to transfer restrictions contingent on the price of Class A common stock exceeding certain thresholds (the "Sponsor-Locked-Up Shares"). The warrants consist of the Company's publicly traded warrants ("Public Warrants") and private warrants to acquire shares of Aurora that have been converted into warrants to acquire shares of Class A common stock ("Private Warrants," and together with the Public Warrants, the “Warrants”). The Public Warrants trade on the Nasdaq under the ticker symbol “BETRW” and as such is considered a Level 1 input from an active market to derive the value. The Private Warrants and Sponsor-Locked up Shares, although not publicly traded on an active market, use inputs from the publicly traded Public Warrants and the Company’s publicly traded Common Stock, respectively, and are further calibrated using unobservable inputs representing Level 2 measurements within the fair value hierarchy. As of December 31, 2025 and 2024, Level 3 instruments include IRLCs. The following table presents the rollforward of Level 3 IRLCs: Year Ended December 31, (Amounts in thousands) 2025 2024 Balance at beginning of period $ 1,222 $ 1,640 Change in fair value of IRLCs 2,738 ( 418 ) Balance at end of period $ 3,960 $ 1,222 Counterparty agreements for forward sale commitments contain master netting agreements, which contain a legal right to offset amounts due to and from the same counterparty and can be settled on a net basis. The table below presents gross amounts of recognized assets and liabilities subject to master netting agreements. (Amounts in thousands) Gross Amount of Recognized Assets Gross Amount of Recognized Liabilities Net Amounts Presented in the Consolidated Balance Sheet Offsetting of Forward Commitments - Assets Balance as of: December 31, 2025: $ — $ — $ — December 31, 2024 $ 1,249 $ ( 18 ) $ 1,231 Offsetting of Forward Commitments - Liabilities Balance as of: December 31, 2025: $ 46 $ ( 600 ) $ ( 554 ) December 31, 2024 $ — $ — $ — 109 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Significant Unobservable Inputs— The following table presents quantitative information about the significant unobservable inputs used in the recurring fair value measurements categorized within Level 3 of the fair value hierarchy: December 31, 2025 (Amounts in dollars, except percentages) Range Weighted Average Level 3 Financial Instruments: IRLCs Pull-through factor 0.03 % - 99.60 % 69.2 % December 31, 2024 (Amounts in dollars, except percentages) Range Weighted Average Level 3 Financial Instruments: IRLCs Pull-through factor 0.45 % - 100.00 % 74.8 % U.S. GAAP requires disclosure of fair value information about financial instruments, whether recognized or not recognized in the consolidated financial statements, for which it is practical to estimate the fair value. In cases where quoted market prices are not available, fair values are based upon the estimation of discount rates to estimated future cash flows using market yields or other valuation methodologies. Considerable judgment is necessary to interpret market data and develop estimates of fair value in both inactive and orderly markets. Accordingly, fair values are not necessarily indicative of the amount the Company could realize on disposition of the financial instruments in a current market exchange. The use of market assumptions or estimation methodologies could have a material effect on the estimated fair value amounts. The estimated fair value of the Company’s cash and cash equivalents, restricted cash, warehouse lines of credit, and escrow funds approximates their carrying values as these financial instruments are highly liquid or short-term in nature. The following table presents the carrying amounts and estimated fair value of financial instruments that are not recorded at fair value on a recurring or non-recurring basis: As of December 31, 2025 2024 (Amounts in thousands) Fair Value Level Carrying Amount Fair Value Carrying Amount Fair Value Short-term investments Level 1 $ 103,607 $ 103,849 $ 53,774 $ 53,791 Loans held for investment Level 3 $ 725,584 $ 745,367 $ 113,144 $ 113,348 Convertible Notes Level 3 $ — $ — $ 519,749 $ 371,160 Senior Notes Level 3 $ 198,802 $ 135,916 $ — $ — In determining the fair value of the Convertible Notes, Senior Notes and loans held for investment, management uses factors that are material to the valuation process, including but not limited to, risks, prospects, and economic and market conditions, among other factors. As a number of assumptions and estimates were involved that are largely unobservable, the Convertible Notes, Senior Notes and loans held for investment are classified as Level 3 inputs within the fair value hierarchy. 110 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 19. Income Taxes The Company adopted ASU 2023‑09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, as of January 1, 2025, prospectively. The amendments enhance the transparency of income tax disclosures and did not have a material impact on the Company’s financial statements. The Company is subject to US (federal, state and local) and foreign income taxes. The components of income (loss) before income tax expense (benefit) are as follows: Year Ended December 31, (Amounts in thousands) 2025 2024 U.S. $ ( 132,816 ) $ ( 163,597 ) Foreign ( 33,003 ) ( 41,843 ) (Loss) income before income tax expense $ ( 165,819 ) $ ( 205,440 ) The following table displays the components of the Company’s federal, state and local, and foreign income taxes. Year Ended December 31, (Amounts in thousands) 2025 2024 Current Income Tax Expense (Benefit): Federal $ 117 $ 121 Foreign ( 25 ) 349 State and local — 376 Total Current Income Tax Expense (Benefit) 92 846 Deferred Income Tax Expense (Benefit): Federal ( 23,237 ) ( 25,971 ) Foreign ( 6,430 ) ( 7,756 ) State and local ( 8,860 ) ( 2,475 ) Valuation Allowance 38,488 36,206 Total Deferred Income Tax Expense (Benefit) ( 39 ) 4 Income Tax Expense (Benefit) $ 53 $ 850 Total income tax provision does not reflect the tax effects of items that are included in APIC, which include a tax expense of $ 741 thousand in 2025. 111 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The following table displays the difference between the U.S. federal statutory corporate tax rate and the effective tax rate, prepared under the updated guidance: December 31, 2025 Amount Percentage U.S. Federal Statutory Tax Rate $ ( 34,822 ) 21.00 % State and local Income Taxes, net of Federal Income Tax Effect — — % Foreign Tax Effects United Kingdom Changes in Valuation Allowances 6,391 - 3.85 % Other 428 - 0.26 % Other foreign jurisdictions 49 - 0.03 % Tax Credits Research and Development tax credits ( 2,792 ) 1.68 % Change in Valuation Allowances 27,134 - 16.36 % Nontaxable or nondeductible items 162(m) - executive compensation 2,454 - 1.48 % Other 1,094 - 0.66 % Changes in Unrecognized tax benefits 117 - 0.07 % Effective Tax Rate $ 53 - 0.03 % The difference between the U.S. Federal statutory tax rate and the effective tax rate relates primarily to the change in valuation allowance. The following table displays the difference between the U.S. federal statutory corporate tax rate and the effective tax rate, prepared under the prior guidance: December 31, 2024 US federal statutory corporate tax rate 21.00 % State and local tax 0.61 % Stock-based compensation - 3.27 % Fair value of warrants 0.09 % Others - 2.33 % Foreign tax rate differential 0.81 % R&D tax credit 0.09 % Unrecognized tax benefits - 0.06 % Change in valuation allowance - 17.35 % Effective Tax Rate - 0.41 % Deferred Income Tax Assets and Liabilities The Company evaluates the deferred income tax assets for the recoverability using a consistent approach which considers the relative impact of negative and positive evidence, including the Company’s historical profitability and losses and projections of future taxable income (loss). As of December 31, 2025, the Company continued to conclude that the negative evidence with respect to the recoverability of its deferred income tax assets outweighed the positive evidence. It is more likely than not that the deferred income tax assets will not be realized. As of December 31, 2025 and 2024, the Company had a 100 % valuation allowance 112 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS on its domestic deferred tax assets. The Company’s framework for assessing the recoverability of deferred income tax assets requires it to weigh all available evidence, to the extent it exists, including: • the sustainability of future profitability required to realize the deferred income tax assets, • the cumulative net income or losses in the consolidated statements of operations and comprehensive income in recent years The following table displays deferred income tax assets and deferred income tax liabilities: As of December 31, (Amounts in thousands) 2025 2024 Deferred Income Tax Assets Net operating loss $ 351,027 $ 372,712 Reserves 5,172 5,110 Loan repurchase reserve 1,256 1,969 Restructuring reserve 2,716 2,376 Accruals 84 174 Internal use software — 12,221 Other 396 587 Total Deferred Income Tax Assets 360,651 395,149 Deferred Income Tax Liabilities Non-qualified stock options ( 9,378 ) ( 10,182 ) Intangible assets ( 2,162 ) ( 467 ) Depreciation ( 3,525 ) ( 939 ) Internal use software ( 3,705 ) — Total Deferred Income Tax Liabilities ( 18,770 ) ( 11,588 ) Net Deferred Tax Asset before Valuation Allowance 341,881 383,561 Less: Valuation Allowance ( 341,645 ) ( 383,362 ) Deferred Income Tax Assets, Net $ 236 $ 199 As of December 31, 2025 and 2024 the Company had federal net operating loss (“NOL”) carryforwards of approximately $ 1,276 million and $ 1,285 million, respectively, and state NOL carryforwards of $ 1,014 million and $ 1,017 million, respectively, which are available to offset future taxable income. As of December 31, 2025 and 2024 the Company had foreign (U.K.) NOL carryforwards of approximately $ 106 million and $ 189 million, respectively, which are available to offset future taxable income and do not expire. Certain state NOLs as of December 31, 2025 will begin to expire in 2035. Utilization of the NOL carryforwards for purposes of federal income tax is subject to an annual limitation pursuant to Internal Revenue Code Section 382 (“Section 382”) due to ownership changes that have occurred. In general, an ownership change, as defined by Section 382, results from transactions increasing the ownership of certain shareholders or public groups in the stock of a corporation by more than 50% over a three-year period. The Company has assessed and concluded there have been multiple changes of control as defined by Section 382 since inception. As of December 31, 2025, the Company's deferred income tax asset relating to the Company's NOL carryforwards will be subject to an annual limitation pursuant to Section 382, thereby limiting the amount of NOL utilization each year. 113 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The income tax paid, net of refunds received for the year ended December 31, 2025 is as follows: Year Ended December 31, (Amounts in thousands) 2025 U.S. federal $ 2,315 U.S. state and local California 1,357 Colorado ( 797 ) Georgia ( 870 ) Indiana ( 110 ) Other ( 78 ) Foreign India 411 UK ( 521 ) Total Income Tax Paid (net of refunds received) $ 1,707 A reconciliation of the beginning and ending balances of gross unrecognized tax benefits is as follows: Year Ended December 31, (Amounts in thousands) 2025 2024 Unrecognized tax benefits - January 1 $ 1,353 $ 1,353 Gross increases - tax positions in prior period — — Gross decreases - tax positions in prior period — — Gross increases - tax positions in current period 48 — Settlement — — Lapse of statute of limitations — — Unrecognized tax benefits - December 31 $ 1,401 $ 1,353 As of December 31, 2025 and 2024, there were $ 1.4 million and $ 1.35 million of unrecognized tax benefits that if recognized would affect the annual effective tax rate. During 2025, the gross unrecognized tax benefits increased by $ 48 thousand and $ 117 thousand of interest and penalties were accrued on the $ 1.4 million unrecognized tax benefit balance. Included in the balance of unrecognized tax benefits of $ 1.4 million as of December 31, 2025, are tax benefits that if recognized, will affect the effective tax rate. The Company files a consolidated federal income tax return, foreign income tax returns and various state consolidated or combined income tax returns. The Company’s major tax jurisdictions are U.S. federal, New York State, New York City, California, and New Jersey. The Company is generally no longer subject to U.S. federal income tax examination for any year prior to 2021, to state or local income tax examinations for any year prior to 2021, or to foreign examinations for any year prior to 2021 for India and for any year prior to 2024 for U.K. Nonetheless, NOLs generated in prior years are subject to examination and potential adjustment by the taxing authorities upon their utilization in subsequent years’ tax returns. The Pillar Two rules are intended to ensure that large multinational enterprise ("MNE") groups pay a minimum level of tax on the income arising in each of the jurisdictions in which they operate. The rules do so by imposing a top-up tax on profits arising in a jurisdiction whenever the effective tax rate, determined on a jurisdictional basis, is below the 15 percent minimum rate. The Pillar Two rules include: • “[A]n Income Inclusion Rule (IIR), which imposes top-up tax on a parent entity in respect of the low taxed income of a constituent entity.” 114 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS • “[A]n Undertaxed Payment Rule (UTPR), which denies deductions or requires an equivalent adjustment to the extent the low tax income of a constituent entity is not subject to tax under an IIR.” Management believes that the Company does not meet the requirements of a MNE and therefore the Pillar Two rules would not have a material future financial effect on the Company. On July 4, 2025, “An Act to provide for reconciliation pursuant to title II of H. Con. Res. 14,” commonly referred to as “One Big Beautiful Bill Act” (the “Act”) was signed into law. The centerpiece of the Act is the extension of expiring, and in some cases expired, provisions of the 2017 Tax Cuts and Jobs Act (2017 TCJA). The Act adjusted a number of provisions affecting businesses that were set to sunset, phase-out, or phase-in that would have taken effect in the absence of action by Congress, or that had already taken effect. There were no material consequences to the Company as a result of this legislation. 20. Segment Reporting The Company's reportable segments are strategic business units that offer different products and services. They are managed separately because each business requires different management expertise, technology, and marketing strategies. During the fourth quarter of 2025, the Company completed its periodic assessment of operating segments and identified the following operating segments: • Home Finance – this segment provides home ownership services such as purchase mortgages, refinance mortgages, and home equity lines of credit and closed-end second lien loans for home purchase and refinance, including cash-out refinance and debt consolidation as well as mortgage related product offerings such as real estate services and insurance services, which includes title insurance. The products, services and customers are similar; and the platform and operations at the consolidated level provide the foundation for delivering home ownership products and services. • Banking – this segment provides a range of financial products and services to consumers and small businesses through Birmingham Bank. The Company acquired Birmingham Bank, a U.K. based regulated bank, in April 2023. Each of the above segments reports to the Company’s CODM for segment reporting purposes. The prior year period presented was recast to reflect the impact of the preceding segment reclassification. 115 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The tables below disclose the Company’s revenues and significant expenses by segment (in thousands): Year Ended December 31, 2025 Home Finance Banking Consolidated Revenues: Gain on loans, net $ 136,148 $ — $ 136,148 Other revenue 11,101 198 11,299 Net interest income Interest income 31,860 28,409 60,269 Interest expense ( 21,847 ) ( 20,997 ) ( 42,844 ) Net interest income/(loss) 10,013 7,412 17,425 Total net revenues 157,262 7,610 164,872 Expenses: Compensation and benefits 161,503 12,723 174,226 General and administrative 41,602 3,721 45,323 Technology 25,772 2,102 27,874 Marketing and advertising 38,293 63 38,356 Loan origination expense 14,499 — 14,499 Depreciation and amortization 13,250 819 14,069 Other expenses/(income) 2,246 14,098 16,344 Income tax expense (benefit) 525 ( 472 ) 53 Net loss $ ( 140,428 ) $ ( 25,444 ) $ ( 165,872 ) Total Assets $ 640,556 $ 864,878 $ 1,505,434 116 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Year Ended December 31, 2024 Home Finance Banking Consolidated Revenues: Gain on loans, net $ 78,098 $ — $ 78,098 Other revenue 12,318 570 12,888 Net interest income Interest income 33,537 5,453 38,990 Interest expense ( 18,927 ) ( 2,561 ) ( 21,488 ) Net interest income/(loss) 14,610 2,892 17,502 Total net revenues 105,026 3,462 108,488 Expenses: Compensation and benefits 131,103 9,986 141,089 General and administrative 48,359 3,871 52,230 Technology 23,459 2,651 26,110 Marketing and advertising 33,982 2 33,984 Loan origination expense 9,864 — 9,864 Depreciation and amortization 32,752 475 33,227 Other expenses/(income) 15,389 2,035 17,424 Income tax expense (benefit) 981 ( 131 ) 850 Net loss $ ( 190,863 ) $ ( 15,427 ) $ ( 206,290 ) Total Assets $ 712,159 $ 200,898 $ 913,057 The tables below represents the Company’s revenues by geographic location (in thousands): Year Ended December 31, 2025 2024 United States $ 138,828 $ 86,652 International 26,044 21,836 Total net revenues $ 164,872 $ 108,488 Revenues are attributed to geographic locations based on the location in which the Company’s products and services are delivered to customers. The United States was the only country to contribute revenues in excess of 10% of consolidated revenues. All transactions between reportable segments are eliminated in consolidation. 21. Stockholders' Equity The Company’s Class A common stock and Public Warrants currently trade on Nasdaq, under the ticker symbols “BETR” and “BETRW”, respectively. The Company’s authorized capital stock consists of 36.0 million shares of Class A common stock, 14.0 million shares of Class B common stock, and 16.0 million shares of Class C common stock, each with a par value per share of $ 0.0001 . Each holder of Class A common stock has the right to one vote per share and each holder of Class B common stock has the right to three votes per share. Except as described below or otherwise provided by the Company’s certificate of incorporation or required by applicable law, shares of Class C common stock are non-voting and will not entitle the holder 117 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS thereof to any voting power. Shares of Class A common stock, Class B common stock and Class C common stock are treated equally, identically and ratably, on a per share basis, with respect to any dividends or distributions as may be declared and paid from time to time. Upon the liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, holders of Class A common stock, Class B common stock and Class C common stock will be entitled to receive ratably all assets of the Company available for distribution to its stockholders unless disparate or different treatment of the shares of each such class with respect to distributions upon any such liquidation, dissolution or winding up is approved in advance by the affirmative vote of the holders of a majority of the then-outstanding shares of Class A common stock, Class B common stock and Class C common stock, each voting separately as a class. Further, each share of Class B common stock is convertible into one fully paid and nonassessable share of Class A common stock or Class C common stock at the option of the holder thereof at any time upon written notice to the Company. Each share of Class C common stock is convertible into one fully paid and nonassessable share of Class A common stock at the option of the holder thereof at any time upon written notice to the Company. The Company's equity structure consists of different classes of common stock which as presented below: As of December 31, 2025 (Amounts in thousands, except share amounts) Shares Authorized Shares Issued and outstanding Par Value Common A Stock 36,000,000 10,183,248 $ 2 Common B Stock 14,000,000 4,376,114 — Common C Stock 16,000,000 1,437,545 — Total common stock 66,000,000 15,996,907 $ 2 As of December 31, 2024 (Amounts in thousands, except share amounts) Shares Authorized Shares Issued and outstanding Par Value Common A Stock 36,000,000 9,193,901 $ 2 Common B Stock 14,000,000 4,537,349 — Common C Stock 16,000,000 1,437,545 — Total common stock 66,000,000 15,168,795 $ 2 Private and Public Warrants— As of December 31, 2025 and 2024, the Company had a total of $ 1.2 million and $ 1.3 million, respectively, of Private Warrants held by a related party, and Public Warrants, which are included as warrant and equity related liabilities, at fair value, within the consolidated balance sheets. The change in fair value of Warrants for the year ended December 31, 2025 and 2024, was a gain of $ 0.2 million and a loss of $ 0.6 million, respectively, and is included in other expenses/(income) within the consolidated statements of operations and comprehensive loss. Sponsor Locked-Up Shares— As of December 31, 2025 and 2024, the Company had a total of $ 0.3 million and $ 0.1 million, respectively, in respect of Sponsor Locked-up Share liabilities which were issued to a related party, and are included within warrant and equity liabilities, at fair value, in the consolidated balance sheets. The change in fair value of Sponsor Locked-Up Shares for the years ended December 31, 2025 and 2024, was a loss of $ 0.2 million and a loss of $ 0.3 million, respectively, and is included in other expenses/(income) within the consolidated statements of operations and comprehensive loss. Notes Receivable from Stockholders —The Company, previously at times, entered into promissory note agreements with certain employees for the purpose of financing the exercise of the Company’s stock options. These employees had the ability to use the promissory notes to exercise stock options that have not yet been vested by the respective employees. Interest is compounded and accrued based on any unpaid principal balance and is due upon the earliest of maturity, 120 days after an employee leaves the Company, the date the employee sells shares acquired through the promissory note agreement without prior written consent of the Company, or the day prior to the date that any change in the employee’s status would cause the loan to be a prohibited extension or maintenance of credit under Section 402 of the Sarbanes-Oxley Act of 2002. The Company no longer enters into promissory note agreements for the purpose of financing the exercise of the Company’s stock options and no longer allows for the early exercise of stock options. 118 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The Company does not expect repayment of the promissory notes and as such has entered into agreements with certain employees to forgive the promissory notes in exchange for the shares held by the respective employee. As the Company does not expect repayment and is seeking to forgive the promissory notes in exchange for the underlying shares, the promissory notes were derecognized against additional paid-in capital on the consolidated balance sheets. The Company recorded a loss of $ 0.4 million for interest receivable on the promissory notes that is included within other expenses on the consolidated statements of operations and comprehensive loss. As of December 31, 2025 and 2024, none and $ 9.2 million, respectively, of promissory notes were recorded as a component of stockholders’ equity within the consolidated balance sheets. At-the-Market Offering Program —On September 26, 2025, the Company implemented an “at-the-market” equity offering program (the “ATM Program”) pursuant to separate sales agreements (each, a “Sales Agreement” and collectively, the “Sales Agreements”) with Cantor Fitzgerald & Co. and BTIG, LLC (each an “Agent” and collectively, the “Agents”). Under the Sales Agreements, the Company may offer and sell shares of its Class A common stock, par value $ 0.0001 per share (the “Shares”), having an aggregate offering price of up to $ 75.0 million , from time to time, in “at-the-market” offerings as defined in Rule 415(a)(4) under the Securities Act of 1933, as amended, through the Agents acting as sales agents or principals. Sales of Shares, if any, will be made at prevailing market prices at the time of sale, or as otherwise agreed with the Agents. Each Agent is entitled to a commission of 2.0 % of the gross sales price of Shares sold through it Agent under its Sales Agreement. The Shares will be issued pursuant to the Company’s registration statement on Form S-3 (File No. 333-287335), which was declared effective by the SEC on June 6, 2025, and the related prospectus supplement dated September 26, 2025. During the year ended December 31, 2025, the Company sold 547,260 shares of Class A common stock under the ATM Program for total gross proceeds of $ 29.8 million. The Company incurred commissions and other offering expenses of $ 0.6 million. As of December 31, 2025, approximately $ 45.2 million remained available for issuance under the ATM Program. Subsequent to December 31, 2025 and through January 9, 2026, the Company sold 328,030 shares of Class A common stock under the ATM Program for total gross proceeds of $ 11.9 million and net proceeds of approximately $ 11.7 million, after deducting aggregate commissions and offering expenses of approximately $ 0.2 million. As of January 9, 2026, approximately $ 33.3 million remained available for issuance under the ATM Program. 22. Stock-Based Compensation Equity Incentive Plans —On November 3, 2016, Better’s board of directors and stockholders adopted the Better 2016 Equity Incentive Plan (the “2016 Plan”), which provides for the grant of non-statutory stock options, stock appreciation rights, restricted stock awards, restricted stock units (“RSUs”) and deferred stock to eligible employees, directors and consultants of the Company. On May 15, 2017, Better’s board of directors and stockholders adopted the Better 2017 Equity Incentive Plan (the “2017 Plan”), which provides for the grant of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock awards and RSUs to eligible employees, directors and consultants of the Company. The 2017 Plan was most recently amended and approved by the stockholders of Better in August 2020. Upon closing of the Business Combination, the remaining unallocated share reserves under the 2016 Plan and the 2017 Plan were cancelled and no new awards will be granted under either the 2016 Plan or the 2017 Plan. Awards outstanding under the 2016 Plan and the 2017 Plan were assumed by Better Home & Finance upon the closing of the Business Combination and continue to be governed by the terms of the 2016 Plan and the 2017 Plan. In connection with the Business Combination each holder of Better HoldCo options and RSUs received an equivalent award adjusted based on the Exchange Ratio that vests in accordance with the original terms of the award. In connection with the Business Combination, the Better Home & Finance’s 2023 Incentive Equity Plan (the “2023 Plan”) was adopted and approved by the Company's board of directors on August 22, 2023. The 2023 Plan allows for the issuance of stock options, stock appreciation rights, restricted stock awards, RSUs and other equity and equity-based awards for issuance to Better Home & Finance’s service providers. A total of 1,772,533 shares of Class A common stock were initially reserved for issuance pursuant to the 2023 Plan (the “Initial Share Reserve”). The Initial Share Reserve will automatically increase on January 1 of each year beginning January 1, 2024 and ending in 2033, in an amount equal to the lesser of (i) five percent ( 5 %) of the shares of Class A common stock outstanding on the last day of the immediately 119 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS preceding fiscal year and (ii) such smaller number of shares of Class A common stock as is determined by the Board or committee of the Board; provided, however, that no more than 12,286,879 shares of Class A common stock may be issued upon the exercise of incentive stock options. On December 7, 2023, the Board determined there would be no such automatic increase to the Initial Share Reserve on January 1, 2024. However, pursuant to the automatic increase provision under the 2023 Plan, the share reserve increased by 303,376 shares during the year ended December 31, 2025. As of December 31, 2025, 1,956,375 awards have been granted under the 2023 Plan. As of December 31, 2025, 255,205 are available for issuance under the 2023 Plan. In connection with the Business Combination, the Better Home & Finance 2023 Employee Stock Purchase Plan (the “ESPP”) became effective on August 22, 2023, pursuant to which eligible employees may purchase shares of Class A common stock at a discounted rate. A total of 322,279 shares of Class A common stock were initially reserved for issuance pursuant to the ESPP (the “ESPP Share Reserve”). The ESPP Share Reserve will automatically increase on January 1 of each year beginning January 1, 2024 and ending in 2033, in an amount equal to the lesser of (i) one percent ( 1 %) of the shares of Class A common stock outstanding on the last day of the immediately preceding fiscal year and (ii) such smaller number of shares of Class A common stock as is determined by the Board; provided, however, that no more than 2,417,091 shares of Class A common stock may be issued under the ESPP. On December 7, 2023, the Board determined there would be no such automatic increase to the Initial ESPP Share Reserve on January 1, 2024. As of December 31, 2025, no shares have been issued under the ESPP. The Company no longer allows for the early exercise of awards under the 2016 Plan, 2017 Plan, or the 2023 Plan. Stock Options — The following is a summary of stock option activity during the year ended December 31, 2025: (Amounts in thousands, except options, prices, and averages) Number of Options Weighted Average Exercise Price Intrinsic Value Weighted Average Remaining Term Stock Options: Outstanding—January 1, 2025 656,221 $ 77.37 $ 34 5.01 Options granted — $ — Options exercised ( 1,515 ) $ 10.43 Options cancelled or forfeited ( 19,246 ) $ 61.25 Options expired ( 26,047 ) $ 61.33 Outstanding—December 31, 2025 609,413 $ 78.74 $ 639 3.57 Vested and exercisable—December 31, 2025 606,708 $ 78.76 $ 639 3.56 Options expected to vest 2,705 $ 75.20 $ — 6.93 December 31, 2025 609,413 $ 78.74 $ 639 3.56 As of December 31, 2025, total stock-based compensation cost not yet recognized related to unvested stock options was $ 0.1 million, which is expected to be recognized over a weighted-average period of 0.9 years. Intrinsic value is calculated by subtracting the exercise price of the stock option from the fair value of the Company’s Common A Stock on December 31, 2025 for in-the-money stock options, multiplied by the number of shares of Common A Stock per each stock option. The total intrinsic value of stock options exercised during the years ended December 31, 2025 and 2024 was $ 0.07 million, and $ 0.09 million, respectively. The weighted average grant-date fair value per share of stock options granted during both the years ended December 31, 2025 and 2024 was none , as no options were granted. The total grant date fair value of options vested for the years ended December 31, 2025 and 2024 was $ 9.4 million and $ 10.5 million, respectively. 120 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Restricted Stock Units —RSUs generally vest over four years upon satisfaction of service-based conditions. The following is a summary of RSU activity during the year ended December 31, 2025: (Amounts in thousands, except shares and averages) Number of Shares Weighted Average Grant Date Fair Value Unvested—December 31, 2024 329,096 $ 49.13 RSUs granted 732,356 $ 18.57 RSUs vested (1) ( 469,035 ) $ 32.46 RSUs cancelled or forfeited ( 50,569 ) $ 30.37 Unvested—December 31, 2025 541,848 $ 24.01 __________________ (1) Included in vested RSUs are 12,618 shares that have vested but for which issuance has been deferred at the election of the participant. For the period ended December 31, 2025, the Company recorded a total stock‑based compensation expense of $ 15.2 million related to RSUs awarded to employees and non-employees directors. As of December 31, 2025, total stock-based compensation cost not yet recognized related to unvested RSUs was $ 10.7 million, which is expected to be recognized over a weighted-average period of 2.24 years. The following is a summary of the Performance and Market-Based RSU activity during the period ended December 31, 2025: (Amounts in thousands, except shares and averages) Number of Shares Weighted Average Grant Date Fair Value Unvested—December 31, 2024 (1) 158,870 $ 22.41 RSUs Granted (2) 1,224,019 $ 69.10 Unvested—December 31, 2025 1,382,889 $ 63.73 __________________ (1) Included in the Unvested balance as of December 31, 2024 are 158,870 Performance Stock Units grant ("PSU"). The PSUs will be eligible to vest upon the satisfaction of specified market-based conditions tied to the price of the Company's publicly traded shares at four distinct price threshold levels. As of December 31, 2025, 158,870 PSUs remained outstanding. (2) Included in the granted balance are 1,224,019 PSUs. Of these, 44,519 PSUs are eligible to vest upon the satisfaction of specified market‑based conditions tied to the price of the Company’s publicly traded shares at four distinct price threshold levels, and 589,750 PSUs are eligible to vest upon the satisfaction of specified market‑based conditions tied to the price of the Company’s publicly traded shares at two distinct price threshold levels. The remaining 589,750 PSUs are eligible to vest upon the achievement of specified revenue‑based performance milestones, which were not considered probable of achievement as of December 31, 2025. Accordingly, no stock‑based compensation expense was recognized for these awards during the year ended December 31, 2025. The weighted-average grant date fair value of the PSUs granted during 2025 was $ 69.10 . The fair value of this award subject to market feature was estimated using a Monte Carlo simulation to address the path-dependent nature of the market-based vesting conditions. Based on the award term, equity value, expected volatility, risk-free rate, and a series of random variables with a normal distribution, the future equity value was simulated. Each trial within the simulation includes assumptions of achieving a per share valuation level of the Company’s common stock as stipulated in the agreement to determine whether the market-based conditions are met resulting in vesting or not, and the future value of the award. The simulation was run for 100,000 trials and the mean results from all the trials was taken as an indication of the fair value of each Tranche. The assumptions used to value the PSUs issued during the years ended December 31, 2025 and 2024 were as follows: 121 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Year Ended December 31, (Amounts in thousands, except shares and averages) 2025 2024 Weighted average expected term (years) 4.0 2.9 Weighted average expected volatility 72.0 % 63.2 % Risk-free interest rate 3.8 % 4.5 % Dividend yield — % — % For the year ended December 31, 2025, the Company recorded a total stock‑based compensation expense of $ 4.1 million related to PSUs awarded to employees and non-employees directors that include a market‑based vesting conditions. As of December 31, 2025, total stock-based compensation cost not yet recognized related to unvested PSUs, based on the satisfaction of market-based conditions, were $ 38.0 million, which is expected to be recognized over a weighted-average period of 3.81 years. As of December 31, 2025, total stock-based compensation cost not yet recognized related to unvested PSUs, based on the satisfaction of revenue-based performance milestones not considered probable, were $ 43.0 million, which if met would be recognized over a weighted-average period of 3.84 years. Stock-Based Compensation Expense —S tock-based compensation expense is included within compensation and benefits in the consolidated statements of operations and comprehensive loss. The Company recognized stock-based compensation expense as follows: Year Ended December 31, (Amounts in thousands) 2025 2024 Total stock-based compensation expense (1) $ 20,432 $ 26,753 __________________ (1) Stock-based compensation expense excludes $ 1.4 million and $ 1.8 million of stock-based compensation expense, which was capitalized (see Note 8) for the years ended December 31, 2025 and 2024, respectively . 23. Regulatory Requirements The Company is subject to various local, state, and federal regulations related to its loan production by the various states it operates in, as well as federal agencies such as the Consumer Financial Protection Bureau, HUD, and the FHA and may be subject to the requirements of the agencies to which it sells loans, such as FNMA and FMCC. As a result, the Company may become involved in requests for information, periodic reviews, investigations, and proceedings by such various federal, state, and local regulatory bodies and agencies. The Company is required to meet certain minimum net worth, minimum capital ratio and minimum liquidity requirements, including those established by HUD, FMCC and FNMA. As of December 31, 2025, the Company was in compliance with all necessary requirements. Additionally, the Company may be subject to other financial requirements established by government-sponsored enterprises (“GSEs”), which include a limit for a decline in net worth and quarterly profitability requirements. In 2023, the Company failed to meet the additional financial requirements due to the Company’s decline in profitability and decline in net worth. The decline in net worth and decline in profitability permit GSEs to declare a breach of the Company’s contract. The Company has implemented additional financial requirements and remains in compliance with all applicable obligations as of December 31, 2025. 24. Subsequent Events The Company evaluated subsequent events from the date of the consolidated balance sheets of December 31, 2025 through the date of the release of financial statements, and has determined that, there have been no subsequent events that require recognition or disclosure in the consolidated financial statements, except as described in Note 4 and Note 21, and as follows: On February 17, 2026, the Company entered into a securities purchase agreement, pursuant to which it issued a warrant to purchase up to an aggregate of 211,312 shares of its Class A common stock. The warrant is subject to certain exercisability conditions and expires on February 17, 2027. The Company also entered into a related registration rights 122 Table of Contents BETTER HOME & FINANCE HOLDING COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS agreement. The transaction occurred subsequent to year-end and did not impact the consolidated financial statements as of December 31, 2025. **** 123 Table of Contents Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosures None.