Hometap is a home equity investment company that offers homeowners another way to “tap” into their house’s equity. Unlike a HELOC or home equity loan, a home equity investment is not a loan and doesn’t have any monthly payments or interest. Keep on reading to learn more about Hometap and see if a home equity investment is right for you!
Headquartered in Boston, Massachusetts, Hometap operates by investing in homeowners. They provide funds (the “investment”) in return for a percentage of the home’s future value. This percentage will remain the same, no matter whether the house appreciates or depreciates in value. If the house appreciates, then the homeowner will receive more proceeds, and if the house depreciates, the amount that has to be paid to Hometap is less. In this way, Hometap is sharing the risk of depreciation with the homeowner, and just like any other investment, they want homeowners to do well.
Working with Hometap is easy from start to finish. If you’re still researching your options, you can take a five-minute quiz to see if Hometap is right for you, or get an estimate in just a couple of minutes with no obligation. If an application is approved, the investment funds will typically be received in as little as three weeks – depending on the value of your home, you could receive as much as $600,000! These funds can be used for practically anything – education, renovations, paying off debt, and more!
The investment period will last for up to 10 years, but you can settle your investment at any time before then with no penalty. There are multiple ways to settle with Hometap – either by buying out your investment, selling your house, refinancing, or taking out a loan.
There are many reasons why someone might choose to get a home equity investment instead of a loan. First of all, because Hometap is not a lender, they are often able to work with those who might not qualify for a home equity loan, like those who are self-employed, or have a non-traditional employment situation. But even if you could qualify for a loan, you still might choose to work with Hometap. Home equity investments do not have any interest costs, don’t require monthly payments, and share the risks of home depreciation with the homeowner. If you want to access your house’s equity, consider if Hometap is right for you!
Hometap is currently operating in 15 states (Arizona, Florida, Massachusetts, Minnesota, New York, Ohio, Pennsylvania, Washington, California, Maryland, Michigan, New Jersey, North Carolina, Oregon, and Virginia). In the next 1 to 2 years, Hometap is projecting to be able to offer services to 75% of US homeowners, making them another option for homeowners to access their equity. Visit their website to see if Hometap is available where you live!