What is a Home Equity Investment Agreement (HEA/HEI)?
Last updated 11/12/2025 by
Ante MazalinEdited by
Andrew LathamSummary:
A home equity investment or agreement is a financial contract that lets you access a portion of your home’s equity in exchange for a share of its future value — without monthly payments. Unlike a traditional loan, repayment occurs when you sell, refinance, or reach the end of the agreement term.
A Home Equity Investment (HEI) — also known as a shared equity agreement (SEA), home equity agreement (HEA), or co-investment agreement — is a financing solution that allows you to access your home equity without taking out a traditional loan or making monthly payments. Instead of borrowing money, you receive a lump-sum cash payment in exchange for a share of your home’s future appreciation.
This innovative product is gaining popularity among homeowners looking to unlock equity without debt. Unlike a traditional home equity loan or HELOC, a home equity investment agreement doesn’t require you to repay on a fixed schedule. The investor is repaid later — typically when you sell your home, refinance your mortgage, or reach the end of the contract term.
Compare the top shared equity programs on SuperMoney.
How Do Home Equity Investments Work?
At their core, home equity investment agreements are equity-based funding arrangements. Here’s how the process typically works:
- You apply with a home equity investment company, such as Hometap, Unison, Point, or Unlock.
- Your home is appraised, and the company assesses how much equity you’ve built.
- You receive a cash lump sum (usually 5% to 20% of your home’s current market value).
- You owe no monthly payments throughout the agreement term.
- When the term ends (often 10–30 years), or you sell or refinance the home:
- You repay the original amount, and
- You give the investor a share of your home’s appreciation — often between 10% and 25%.
These products are also known as no-monthly-payment home equity options, and they appeal to homeowners who are equity-rich but cash-poor or who have low credit scores and can’t qualify for traditional loans.
Learn more: Tap into home equity without getting into debt
Home Equity Investment Example
Let’s say your home is worth $400,000, and you enter into a home equity investment agreement to receive $40,000. In exchange, the investor asks for 20% of the home’s future appreciation.
- If you sell the home 5 years later for $500,000, the appreciation is $100,000.
- You would repay the $40,000 + 20% of the appreciation ($20,000), for a total of $60,000.
If your home depreciates, the investor shares in the loss, and you may repay less than you received.
Pros and Cons of Home Equity Investment
Let’s examine the benefits and potential drawbacks of home equity investment agreements in more depth:
What Are the Requirements for a Home Equity Investment?
Although terms vary by company, here are the general eligibility requirements:
- Sufficient home equity
Most providers require at least 25%–30% equity in your home. - Primary residence
Some providers allow rental or investment properties, but many focus on owner-occupied homes. - Minimum home value
Typically $100,000 to $250,000 or more, depending on the provider. - Single-family homes, townhomes, or select condos
Mobile homes, co-ops, and manufactured housing are usually excluded. - Age requirements
Most companies serve all age groups (unlike reverse mortgages), but you must be 18+. - Credit score and financial review
While more flexible than traditional loans, HEA companies will evaluate your credit history, income, and outstanding debt.
Want to know if you qualify? Read:
How much equity do I have in my home?
How much equity do I have in my home?
How to Choose a Home Equity Investment Company
Choosing the right HEA provider is just as important as deciding to get one. Here’s how to compare:
- Payout amount
How much cash can you access? Some companies offer higher maximums than others. - Ownership percentage taken
Look closely at how much equity or appreciation share you’re giving up. - Term length and buyout flexibility
Can you buy out the agreement early without a penalty? - Appraisal method and fees
Some providers use third-party appraisers, others do desktop valuations. Understand all costs upfront. - Customer support and reputation
Read real reviews, look for transparency, and compare brand trust.
Top Home Equity Investment Agreement (HEI/HEA) Companies
A growing number of fintech firms now offer shared equity agreements as an alternative to home equity loans and HELOCs. These companies give homeowners upfront cash in exchange for a portion of their home’s future appreciation — with no monthly payments, and flexible repayment terms.
Here are three leading providers worth considering:
Hometap
Hometap is one of the most well-established home equity investment companies. They provide cash to homeowners in exchange for a share of future home appreciation — usually for a term of 10 years. Hometap’s model is designed for homeowners who want to avoid new debt and get funding quickly, often within three weeks.
Highlights:
- 10-year agreement term
- Available in over a dozen states
- No monthly payments
- Option to buy out early
Read the full Hometap review
Point
Point offers flexible equity-based financing with agreement terms of up to 30 years. It’s one of the few providers that allows higher funding amounts and works with a wide range of credit profiles. Point is especially appealing to homeowners in high-value markets who want longer-term flexibility.
Highlights:
- Up to 30-year term
- Borrow up to $500,000
- Available to homeowners with credit scores as low as 500
- Transparent pricing and early exit options
Read the full Point review
Unlock
Unlock focuses on making home equity investment agreements accessible for a broader range of homeowners. They offer competitive terms, support second homes in some cases, and have an easy online application process. Their agreements last up to 10 years and come with optional early buyout windows.
Highlights:
- Cash offers from $30,000 to $500,000
- 10-year agreement term
- Works with homes as low as $250,000 in value
- Available in many major states including California, Florida, and Texas
Read the full Unlock review
See our comparisons:
Alternatives to Home Equity Sharing Agreements
Not sure if a home equity investment agreement is right for you? Here are some popular alternatives:
Cash-Out Refinance
Replace your mortgage with a larger one and take the difference in cash. Great if interest rates are favorable — but you’ll have monthly payments.
Learn more about cash-out refinance
Learn more about cash-out refinance
Home Equity Loan (Second Mortgage)
A lump-sum loan secured by your home equity, paid back in fixed monthly installments.
Learn more about home equity loans
Learn more about home equity loans
HELOC (Home Equity Line of Credit)
A revolving credit line based on your equity, ideal for ongoing expenses. Requires strong credit.
Learn more about Heloc
Learn more about Heloc
Reverse Mortgage
For homeowners age 62+, a reverse mortgage allows you to tap into home equity and delay repayment until you move or pass away.
Learn more about reverse mortgage
Learn more about reverse mortgage
Sale-Leaseback
Sell your home and stay as a renter. Companies like EasyKnock offer this as a debt-free equity access option.
Learn more about sale-leaseback
Learn more about sale-leaseback
HEA vs Home Equity Loan vs HELOC vs Reverse Mortgage
| Feature | Home Equity Investment | Home Equity Loan | HELOC | Reverse Mortgage |
|---|---|---|---|---|
| Monthly Payments | No | Yes | Yes | No |
| Interest Charged | Doesn’t accrue like a traditional loan | Yes (Fixed) | Yes (Variable) | Yes (Accrued) |
| Credit Score Requirement | Flexible / Low | Good to Excellent | Good to Excellent | None |
| Age Requirement | None | None | None | 62+ |
| Repayment Trigger | Sale, Refinance, or End of Term | Monthly Installments | Monthly Payments During Draw and Repayment Periods | Home Sale, Move, or Death |
| Use of Funds | Unrestricted | Unrestricted | Unrestricted | Some restrictions may apply |
| Equity Retained | Partial (Shared) | Full | Full | Partial (Repayment at Exit) |
Final Thoughts: Is a Home Equity Investment Right for You?
A home equity investment agreement provides a flexible way to unlock the value tied up in your home without taking on a traditional loan. It’s ideal for homeowners who:
- Need cash now but don’t want more debt
- Have significant equity but low income or credit
- Are comfortable with sharing future appreciation
However, it’s not a one-size-fits-all solution. If you expect your home to appreciate dramatically or you qualify for low-interest loans, a traditional product may be more cost-effective in the long run.
Read more: What is Shared Equity Homeownership?
Learn how to use a Home Equity Investment to buy another property and unlock the value of your home without taking on traditional loan payments.
HEI With No Income Verification — Learn how a home equity investment can serve as an alternative to a HELOC when you don’t meet traditional income requirements.
Key Takeaways
- Home equity investment agreements let you tap into your home’s value without a traditional loan or monthly payments.
- You receive a lump sum today in exchange for sharing a portion of your home’s future appreciation.
- Repayment is typically due when you sell, refinance, or reach the end of the agreement term.
- They’re ideal for homeowners with significant equity who want cash without taking on additional debt.
Frequently Asked Questions
What’s the difference between a home equity loan and a home equity investment agreement?
A home equity loan is a type of debt that requires monthly payments with interest, while a home equity investment agreement provides cash upfront in exchange for a share of your home’s future appreciation — with no monthly payments.
Can I get out of a home equity investment agreement early?
Yes, most HEA providers allow you to buy out the agreement early, but there may be specific time windows, fees, or appraisal requirements depending on the company’s terms.
What happens if my home goes down in value?
If your home loses value, many HEA companies share in the loss. This means you may repay less than you received, making it a potentially less risky option in declining markets.
Do I have to pay taxes on the money I receive from an HEA?
Generally, the funds received from a home equity investment agreement are not considered taxable income because they do not accrue interest like a traditional loan or count as earned income — but it’s always wise to consult a tax advisor.
Can I use a home equity investment agreement on a rental or investment property?
Some HEA companies only work with primary residences, while others — like Point or Unlock — may allow agreements on second homes or investment properties. Terms vary by provider.
Looking to invest in real estate? Learn how to use a Home Equity Investment to buy another property and unlock the value of your home without taking on traditional loan payments.
Understanding Home Equity Investments and Agreements
- How do HEI and HEA agreements work?
— Learn how home equity sharing agreements allow you to access cash without monthly payments or new debt. - Home appraisal requirements for HEIs and HEAs
— Understand how the appraisal process determines your property’s value and affects your funding amount. - Refinancing challenges with a home equity agreement
— Discover how a home equity agreement can impact your ability to refinance or sell your home in the future. - Exit options for a home equity investment or agreement
— Explore different ways to end your agreement, including repayment, refinancing, or selling your home. - What happens when an HEI or HEA term ends?
— Find out what occurs when your agreement reaches its maturity date and how repayment is calculated. - Common use cases for home equity investments and agreements
— See how homeowners use HEIs and HEAs for renovations, debt consolidation, or funding major expenses. - The cost of a home equity investment or agreement
— Get a clear overview of potential fees, home appreciation sharing, and total costs involved.
Related Reading: Compare Your Options
Curious how home equity investment agreements stack up against more traditional ways to tap your equity? Check out these in-depth comparisons:
- Home Equity Investment vs HELOC: See how shared equity compares to a revolving line of credit.
- Home Equity Investment vs HELOC vs Home Equity Loan: Explore all three options side-by-side to find the best fit for your needs.
These supporting guides break down the key differences in cost, structure, and repayment — helping you make the most informed choice possible.
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