“Find a need and fill it,” said Henry Kaiser, a foremost single and multi-family developer during the mid-20thC. Some sales-back lease companies and homeownership investors “have found” a need for debt-free, equity access and are now determined to fill that need.

And now there are, in fact, a number of “shared equity” alternatives to enable homeowners to tap into their home equity without having to tap into a home equity loan or line of credit.   Here are some of these shared equity alternatives:

Unison Home Ownership Investors

  1. Unison is a long-time leader in homeownership development.
  2. Unison invests 5%-20% of the home’s value and then offers that percentage to the homeowners in cash.
  3. The homeowners retain full ownership of the house and can renovate or sell the house at any time.
  4. The deal comes of age in 30 years and Unison takes a cut of the home’s appreciation within that time period. Typically that appreciation is close to 35%.
  5. Alternatively, the homeowner can repay Unison its investment after 3 years.

Patch

  1. This California-based company typically invests 10%-15
  2. % of the home value in exchange for sharing in the home’s future appreciation.
  3. The homeowner has the option of buying back the home within 10 years without having to pay any interest or having to pay monthly payments in the interim.

 HomeTap.

  1. Provides up to 20% of home equity in cash for a 10-year term in order to share in the home’s appreciation.
  2. If the home value declines during the term of the deal, HomeTap shares in the losses.
  3. Pending a multi-state rollout, the company currently operates in Massachusetts and California.

Equifi’s Equity Funding Instrument

  1. This instrument is not yet fully formed but its focus is on accessing equity in cash in exchange for a portion of the home’s value when the homeowner sells, prepays or passes away.
  2. Launching in California, this instrument is set to rollout in 16 states.

EasyKnock

  1. This sale-lease-back company buys a house, hands over the equity in cash and then rents the house back to the homeowner for as long as she/he wants.
  2. The homeowner can renew the lease annually and then buy back the house when ready or decide to move on from the house.
  3. This shared equity alternative is looking to collaborate with HELOC lenders and reverse mortgage instruments.
  4. CEO Jared Kessler said, “We’re focused on helping people who are getting turned down…our goal is to become the destination for people who want to turn around their lives…”

Figure Technologies

  1. Figure uses block chain and AI to provide consumer credit options.
  2. Homeowners can borrow from $15,000 to $100,000 with loan terms ranging from 5-15 years.
  3. Annual percentage ranges begin at 5.99%.
  4. Offered as an alternative to reverse mortgages, Figure is led by the former founder of SoFi and CEO Mike Cagney
  5. A strong selling point with Figure is that homeowners can apply in 5 minutes and be funded in 5 days.