Hometap Launches to Give Homeowners New Way to Access Home Equity
BOSTON (PRWEB) June 27, 2018 -- Hometap, the data-driven, home equity investment platform, today announced that its home equity product is now available to qualified homeowners in Massachusetts with near-term plans of expansion to other states.
Hometap is a way for homeowners to be paid today for equity they’ve accumulated in their property without getting a loan. The company invests alongside homeowners, providing cash now and participating in the proceeds at the time of sale. Homeowners can complete a short Investment Inquiry and open an account online. Hometap can then provide an estimated investment amount, typically between 10 and 20 percent of the home’s value, and terms if applicable. In addition, they are able to submit a quick Fit Quiz online to gauge how an investment in their property may fit into their unique financial picture.
The U.S. residential real estate market is the world’s largest asset class, currently valued around $24 trillion. Of that $24 trillion, 60 percent, or $14.5 trillion, is owned by homeowners. Historically, that home equity is challenging for homeowners to access. In a recent study commissioned by Hometap, US homeowners who have owned their home at least five years, reported more than $120,000 in equity, yet only one in three said they believe that equity is easily accessible should they need or want it. Further, more than half of respondents said they have never even considered many of the traditional, debt-based options such as refinancing or home equity loans, citing debt already being one of their biggest daily concerns. In addition, qualifying for loans can be extremely difficult, and the time it takes between applying and seeing funds can take months.
“Millions of homeowners are the exact definition of house rich and cash poor,” said Jeffrey Glass, CEO of Hometap. “Many of us are sitting on hundreds of thousands of dollars of equity in our home while we wait on other financial goals, ranging from paying off debt, to helping our kids go to college, to taking that dream vacation. At Hometap, we want to give people a new option: a debt-free choice that lets homeowners access their equity now with less risk to their future.”
Hometap’s investment structure and fees are unique to each homeowner and his or her property. Hometap’s investor share is strictly a function of the sale price, therefore aligning Hometap’s and homeowners’ incentives and creating transactional transparency. Homeowners will know exactly how much of the sale price they will retain and how much will go to pay out the investment. The investment term is 10 years, and the homeowner can decide to either sell, refinance, or buy out the investment at any point during that term. In cases where the home price goes down, Hometap’s investor share is reduced. The complete process, from initial inquiry to cash in hand, takes as little as three weeks. And unlike a lender, Hometap receives no monthly payments or guaranteed return on the money they invest.
The launch follows the company’s Series A funding round where it raised $14.5 million in April 2018. The round, led by G20 Ventures, was joined by previous investor General Catalyst, as well as American Family Ventures, the venture arm of AmFam Insurance, and Pillar.
About Hometap
Hometap is revolutionizing home financing, giving this generation of homeowners a new way to take advantage of the equity they’ve earned in their homes. Founded in 2017, Hometap makes investments of up to 20 percent of a home’s current value, allowing homeowners to immediately receive cash for the things they need and want without having to incur further debt through a home equity loan or second mortgage. Because Hometap is not a lending product, there is no set credit score required, no interest rates, and no monthly payments. Through home equity investments, Hometap is working to make homeownership more accessible and less stressful. For more information, please visit http://www.Hometap.com.
Sonia Segal-Smith, Kickstand Communications, (857) 263-3392, [email protected]
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