Home Equity Investment (HEI) to be debt-free? Seeking Unison/Point/Hometap agreement

[Michael Edwards]

Hello BiggerPockets,

I'm seriously thinking about using Home Equity Investment (HEI) to become debt-free, but I want to make sure I understand all the details before diving in. I've been looking into companies like Unison, Point, and Hometap, but I haven't been able to find a copy of their standard agreements online.

Would anyone be willing to share a copy of a standard agreement from one of these companies (or a similar HEI provider)? I'd really appreciate the chance to review the terms and conditions before making any decisions.

If you've gone through this process and have insights to share, I'd love to hear about your experience too.

Thanks in advance for any help you can offer!

[Don Konipol]

Quote from @Michael Edwards:

Thank you for your input, Chris. 

HEIs, offered by companies like Unison, Point, and Hometap, are not about paying off mortgage in exchange for equity. Instead, they typically provide cash for a percentage of your home's value (usually up to 30%) in exchange for a share of future house price appreciation. This lets homeowners access their equity without taking on new debt, additional monthly payments, or having to move out. As I am considering this option, I am looking for a standard agreement from one of these companies.

These companies are set up to make a profit, nothing wrong with that.  However, their profit is at the cost of YOUR future wealth.  Any “benefit” to you has to be weighed against the “hit” you take on your future net worth.  Taking on deals like this that decrease wealth, such as low return high upfront cost whole life insurance, paying 19% interest on credit card debt, paying 2% annually to have a “wealth advisor” place your money in Vanguard Index Funds, paying for a high cost mortgage because you’re credit is bad, and “debt consolidation” programs are all reasons adding up to why many people can’t achieve financial independence and remain dependent on working every day to live paycheck to paycheck.

There is a chance that in a particular circumstance any of these, including the program offer you describe, can be beneficial in certain specific cases.  But often it’s just the thought that you’re achieving something when all you’re doing is trading a perceived psychological benefit for future wealth.  It’s how you remain “poor”, not how you gain financial independence.