5 Best Home Equity Sharing Companies in 2022

Shared equity agreements can be a good option for homeowners to access home equity without taking on debt.

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Home equity sharing is an innovative way to finance renovations on your house or to provide you with cash for other investments without the need for a monthly repayment schedule. This makes home equity sharing a potentially nice option for people who can’t access traditional financing or who don’t want to add another recurring expense to their budget.


Best Home Equity Sharing Companies

Choosing an investment company for your home equity sharing needs is no easy feat. Here are the 5 best home equity sharing companies to consider for your financing needs.

1. Unlock: Best Overall

In A Nutshell

  • Availability: Washington, Virginia, Utah, Tennessee, South Carolina, Oregon, North Carolina, New Jersey, Nevada, Minnesota, Michigan, Florida, Colorado, California, and Arizona
  • Contract Term: 10 years
  • Investment Amount: $30,000 and $500,000
  • Monthly Payments: None required
  • Restrictions: No restrictions on how you can use the funds
  • Share of Home’s Equity Appreciation: Average of 1% to 44% of your home’s value at the end of your contract
  • Credit Score Requirement: Low credit score (500+)

on Unlock’s website

Our Rating 4.5
4.5/5

Pros:

Cons:

Unlock is an up-and-coming home equity sharing company that was founded in 2020. With Unlock, homeowners in 15 states can access cash payments of between $30,000 and $500,000 that have a fixed 10-year repayment term.

One of the biggest benefits of Unlock is that the company lets you make partial buy-out payments so you can chip away at how much you owe over time.

Unlock also has no income requirements and it’s welcoming to homeowners with lower credit scores. Plus, Unlock lets you use your funds for whatever you want without any restrictions.

2. Unison: Best For Longer Contract Terms

In A Nutshell

  • Availability: Arizona, California, Colorado, District of Columbia, Delaware, Florida, Illinois, Indiana, Kansas, Kentucky, Massachusetts, Michigan, Minnesota, Missouri, Nevada, New Jersey, New Mexico, New York, North Carolina, Ohio, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Utah, Virginia, Washington, Wisconsin
  • Contract Term: 30 years
  • Investment Amount: $30,000 and $500,000
  • Monthly Payments: None required
  • Restrictions: No restrictions on how you can use the funds
  • Share of Home’s Equity Appreciation: Average of 20% to 70% of your home’s change in value at the end of your contract
  • Credit Score Requirement: Fair credit score (620+)

on Unison’s website

Our Rating 4.4
4.4/5

Pros:

Cons:

One of the longest-running home equity sharing companies in business today, Unison is a California-based company investment firm that works with homeowners in 29 states.

Unison is one of our top choices for a home equity sharing company because it offers 30-year terms on all contracts.

Additionally, Unison shares in any gain or loss in the value of your home so long as you maintain your property to an acceptable standard. The company offers investment amounts of $30,000 to $500,000, too, and you can pre-qualify online for financing in just 60 seconds without any impact on your credit score.

3. Hometap: Best For Low Credit Scores

In A Nutshell

  • Availability: Washington, Virginia, Pennsylvania, Oregon, Ohio, North Carolina, New York, New Jersey, Minnesota, Michigan, Massachusetts, Maryland, Florida, California, and Arizona
  • Contract Term: 10 years
  • Investment Amount: $15,000 and $600,000
  • Monthly Payments: None required
  • Restrictions: No restrictions on how you can use the funds
  • Share of Home’s Appreciation: Average of 5% to 25% of your home’s value at the end of your contract
  • Credit Score Requirement: Low credit score (500+)

on Hometap’s website

Our Rating 4.5
4.5/5

Pros:

Cons:

Offering financing options for homeowners with a range of investment goals, Hometap is a home equity sharing company that makes it easy for you to get cash when you need it most.

What sets Hometap apart is its support for homeowners of different financial backgrounds. In fact, Hometap offers financing of between $15,000 and $600,000 for people with credit scores of at least 500.

Another cool feature of Hometap is that it lets you repay your investment early without penalty. With Hometap, you can also apply for more cash during your existing contract if you want to finance additional projects.

4. Point: Best For Low Equity Requirement

In A Nutshell

  • Availability: Washington, Virginia, Pennsylvania, Oregon, North Carolina, New York, New Jersey, Minnesota, Michigan, Massachusetts, Maryland, Illinois, Florida, Colorado, California, Arizona, and Washington, D.C.
  • Contract Term: 30 years
  • Investment Amount: $25,000 and $500,000
  • Monthly Payments: None required
  • Restrictions: No restrictions on how you can use the funds
  • Share of Home’s Equity Appreciation: Average of 15 to 40% of your home’s value at the end of your contract
  • Credit Score Requirement: Low credit score (500+)

on Point’s website

Our Rating 4.3
4.3/5

Pros:

Cons:

Point is a home equity sharing company that provides long-term contracts for homeowners with a wide diversity of financial backgrounds.

As of the time of writing, Point works with homeowners in 16 states, plus DC, to get them lump sums of cash that can be used for any purpose. Point’s biggest advantage is that it offers 30-year contract terms and that it accepts homeowners with credit scores of as low as 500.

Additionally, Point has an awesome promotional pricing program that can help you get a discount on your contract if you’re going to use your funds for home renovations. Point also offers investments of between $25,000 to $500,000, and you can repay at any time.

5. Noah: Best Home Protection Program

In A Nutshell

  • Availability: Washington, Virginia, Utah, Oregon, New York, New Jersey, Massachusetts, Colorado, California, and Washington, D.C.
  • Contract Term: 10 years
  • Investment Amount: $30,000 and $500,000
  • Monthly Payments: None required
  • Restrictions: No restrictions on how you can use the funds
  • Share of Home’s Equity Appreciation: Average of 15% to 40% of your home’s value at the end of your contract
  • Credit Score Requirement: Low credit score (580+)

on Noah’s website

Our Rating 4.2
4.2/5

Pros:

Cons:

Formerly known as Patch Homes, Noah is an investment company that provides home equity sharing services for homeowners in 9 states.

When compared to other similar companies, Noah offers some key benefits including a low minimum credit score requirement of 580. The company also only requires that you have a 15% equity stake in your home, which is lower than what you’ll find elsewhere.

Noah lets you access cash payments of between $30,000 to $500,000 with 10-year terms that you can use for home repairs or even as a contribution toward your down payment. If that wasn’t enough, Noah also has a Home Protection Program for clients that can cover the cost of homeownership expenses in an emergency. 


How to Pick A Home Equity Sharing Company

As is the case with most things in the wider world of finance, home equity sharing can get pretty darn complicated. The good news is that we’re here to help. In this section, we’ll discuss some of the most important things that you ought to consider as you research companies for your home equity sharing needs.

Investment Amount

The first thing to consider when selecting a home equity sharing company is how much they’re willing to invest in any given home and if those limits align with your needs.

For example, you might need $15,000 to pay for a kitchen renovation or $200,000 for a downpayment on another property. Either way, you need to be sure that your financial needs are within a company’s stated investment range so that you don’t end up with more or less cash than you actually need.

It’s also worth mentioning that a company’s stated investment range is just an estimate of what they’re willing to finance. A company might have an investment range of $30,000 to $500,000, but the amount you qualify for depends on a lot of factors, including the value of your home and your credit history.

Fees

Once you’ve found a home equity sharing company that can work for your needs, it’s time to investigate the fees that the firm charges for its services.

Most of these companies charge origination and transaction fees that are added to your contract at the time of repayment. The average cost of these fees is around 3%, though this can vary.

In some cases, these businesses will also cover the cost of any appraisals or inspections that you need to get to qualify for home equity sharing. But these are often out-of-pocket costs that the homeowner needs to take care of.

At the end of the day, it’s important that you pay close attention to the fees that you’ll be charged, especially if you have a tight budget. Consider asking for a list of all a company’s fees upfront so you’re not surprised by extra costs down the line.

Eligibility

Every home equity sharing company has its own homeowner eligibility requirements that determine who it can work with. Most of these businesses assess things like your credit score, home value, and home location when determining whether they can offer you financing. 

Many of these companies also look at how much equity you currently have in your home as they also have maximum acceptable loan-to-value (LTV) ratios. Your income level may also play a role in your eligibility, but this isn’t common.

You’ll ultimately need to find a company that can work with your unique financial situation, but it’s important to remember that meeting minimum eligibility requirements doesn’t guarantee approval. Home equity sharing companies assess a wide array of factors to determine whether you’re eligible for financing and how much you can receive.

Overall Reputation

If you’re going to enter into a home equity sharing agreement it’s vital that you trust the company you’re doing business with.

There are many ways to assess the credibility of a company, including reading reviews on websites like BBB and Trustpilot. But keep in mind that people are more likely to leave reviews if they have a bad experience with a company than if they have a good experience. 

This means that you’ll want to read both the reviews that people leave and any responses that a company gives to unsatisfied clients. Doing so can help you see whether that business really cares about helping its customers and it can make it easier for you to decide if you want to work with that company.

Benefits

The main reason why people work with home equity sharing companies is that they want to use their home’s value to get a lump sum of cash upfront without the need for a monthly repayment plan. But many of these businesses now offer extra benefits to customers that can make them a better deal than their competitors.

Potential benefits to look out for include financing discounts if you’re going to use your funds for home improvement. Some companies even offer flexibility for repayment by offering partial buyouts. Meanwhile, others let you access additional cash as needed during your contract.

All of these benefits can enhance the value of your home equity sharing agreement, so it’s worth keeping an eye out for them during the research process.

Buy-Out Considerations

Finally, it’s critical that you consider what the end of your home equity sharing agreement will look like. There are a few key features that you ought to consider in your agreement, including:

  • Term Length – Longer term lengths give you more time to repay, but they also increase the possibility that your home’s value will rise substantially. Meanwhile, shorter term lengths increase the risk that you’ll have to sell your home if you can’t come up with the cash before your contract ends.
  • Early Buy-Out Flexibility – Most companies let you repay your contract early, but some have minimum wait periods of 6 months to 3+ years before you can buy them out. 
  • Repayment Penalties – In rare cases, a company might have a penalty that you’ll need to pay if you want to buy out your contract early.

Ultimately, there’s no home equity sharing agreement that will work for all homeowners. The important thing here is that you carefully consider the terms of your agreement so that you can find one that’s best suited for your situation.


Pros of Home Equity Sharing

  • Home equity sharing is not a traditional form of debt, so it doesn’t require any monthly payments.
  • Unlike home equity loans, home equity sharing is often available to homeowners with lower credit scores.
  • Many home equity sharing companies are willing to work with homeowners who don’t have a steady income, such as people who are self-employed.
  • You can often use your cash payment for anything that you’d like, but most people use the funds for home renovations.
  • Most home equity sharing companies also take on the risk of financial loss, so if your home loses value, you’ll owe less than if your home increased in value.
  • Many firms let you prequalify for a home equity sharing agreement without any impact on your credit score.

Cons of Home Equity Sharing

  • Reduces how much you can earn over time if your home’s value increases significantly in the future
  • Generally costs more in the long term than a home equity loan, especially if your home’s value increases.
  • Most home equity sharing companies require that you already have a sizable amount of equity in your home, so it’s not an option for people with large outstanding mortgage debt.
  • You might be forced to sell your home in the future if you can’t afford to repay the investment company at the end of your term.
  • Homeowners with low credit scores may receive lower lump sums of cash in exchange for a higher share of their future home equity.
  • Most home equity sharing companies only work in select states, so finding an investor in your area can be tricky.

FAQ Home Equity Sharing Companies

Here are our answers to some of your top questions about home equity sharing companies.

What is Home Equity Sharing?

Home equity sharing is an agreement between you (the homeowner) and an investment company. In this agreement, the investment company provides a lump sum of cash in exchange for a portion of your home’s equity. You can often use the cash for whatever you want, but you have to buy out the company’s stake in your equity after a set period (normally 10–30 years)

How Do Home Equity Sharing Agreements Work?

The idea behind home equity sharing agreements is that an investment company gives you cash in exchange for a portion of your home’s value. For example, you might get a $50,000 payment from an investment company in exchange for 20% of your home’s value in 10 years. If your home is appraised at $500,000 in 10 years, you would owe $100,000.

Is Equity Sharing a Good Idea?

Equity sharing can be a good idea, but it depends on your financial situation. A home equity sharing agreement can be helpful if you don’t want to make monthly payments or if you don’t have great credit. However, these agreements could lead to higher costs in the long term than home equity loans, especially if your property’s value rises over time.

Who Is Home Equity Sharing Best For?

Home equity sharing is best for people who need access to a large lump sum of cash but that either don’t qualify for a conventional home equity loan or don’t want another monthly loan payment. But home equity isn’t necessarily a great idea if you expect your home’s value to rise substantially in the future or if you don’t currently have a lot of equity in your house.

How Does Your Credit Score Affect The Amount You Receive?

Your credit score usually has a sizable impact on how much cash you can receive from a home equity sharing company. People with lower scores won’t qualify for as much cash as someone with a higher score. But, these companies take many factors into account, including your home’s current value, so people with lower scores may still be able to get a large cash payment.

Do Home Equity Sharing Agreements Come with a Monthly Repayment Plan?

No, home equity sharing agreements do not come with a monthly repayment plan. Instead of monthly payments, you’ll be responsible for buying out the investment company’s share in your home after a set date (normally 10 to 30 years). You can do this by paying back a lump sum of cash or by selling your home and using part of the proceeds for repayment.

What Happens If My Home Depreciates in Value?

If you have a home equity sharing plan and your home depreciates in value, the investing company that you’re working with will generally also share that loss. This means that the amount you owe at the end of your agreement will be less than if your home maintained its value. But always double-check the terms of your agreement for more specific information.

Final Thoughts

Home equity sharing can be a helpful alternative to traditional home equity loans and there are plenty of great companies out there that you can work with to finance your future.

These companies offer an innovative way to get a lump sum of cash using the value of your home without the need for stringent income or credit score requirements. Plus, these home equity sharing contracts don’t come with monthly payments, so they’re a nice option for people who don’t want to add another expense to their budgets.

However, home equity sharing isn’t risk-free, and it’s not something you should jump into without careful consideration. If you decide that this sort of financing is right for your life, be sure to carefully consider the pros, cons, features, and fees of the company you want to work with so you can get the best deal possible.

In A Nutshell

  • Availability: Washington, Virginia, Utah, Tennessee, South Carolina, Oregon, North Carolina, New Jersey, Nevada, Minnesota, Michigan, Florida, Colorado, California, and Arizona
  • Contract Term: 10 years
  • Investment Amount: $30,000 and $500,000
  • Monthly Payments: None required
  • Restrictions: No restrictions on how you can use the funds
  • Share of Home’s Equity Appreciation: Average of 1% to 44% of your home’s value at the end of your contract
  • Credit Score Requirement: Low credit score (500+)

on Unlock’s website

Our Rating 4.5
4.5/5

Pros:

Cons:

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by The Modest Wallet

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