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Loan-to-Value-ratio

Unlock better loan terms! Discover how your Loan-to-Value (LTV) ratio affects interest rates, PMI, and eligibility for mortgages and other loans.

What is LTV? | Unison Home Equity

Contact us today to learn more about how Unison can help you access your home equity with lower monthly payments, flexible terms, and competitive rates.

Summer Home Maintenance: This Season's Steps to Protect Your Best Investment

Stay ahead this summer with seasonal home maintenance tips to protect your home, boost efficiency, and avoid costly repairs.

Summer Home Maintenance: This Season's Steps to Protect Your Best Investment | Unison Home Equity

More Than Just Payments: How Your Home Value Grows

Mortgage payments are only part of the story. Learn how home value grows through equity, market trends, and smart improvements – even in today's changing economy.

More Than Just Payments: How Your Home Equity Grows | Unison Home Equity Solutions

Get your personalized rate estimate today and access your home equity with Unison.

a person closely examining tax documents with a magnifying glass

10 Commonly Overlooked Tax Breaks and Deductions You Might Be Missing

Don't miss out on valuable tax savings. Discover 10 commonly overlooked tax breaks and deductions – including homeowner, education, and retirement benefits.

10 Commonly Overlooked Tax Breaks and Deductions You Might Be Missing | Unison Home Equity Sharing

What Are Property Taxes For?

Learn what property taxes are for, how they're assessed, and why they’re essential to funding schools, public services, and your community's quality of life.

What Are Property Taxes For? How They Work and Why They Matter | Unison Home Equity Sharing

What Is DTI? Understanding Your Debt-to-Income Ratio

Faced with unpredictable rates in 2025? Learn how to lock in a good deal, refinance fast, and protect yourself from interest rate hikes with these smart borrowing tips.

What Is DTI? Understanding Your Debt-to-Income Ratio | Unison Equity Sharing

piggy bank broken with a hammer next to it

Equity-Sharing Home Loans vs. HELOCs: Building an Emergency Fund

Building an emergency fund? There are a few ways you can do it with your home equity. Compare an equity-sharing home loan vs. a home equity line of credit (HELOC) today.

Equity-Sharing Home Loans vs. HELOCs: Building an Emergency Fund | Unison Equity Sharing

Tips for Building a Budget and Creating Better Spending Habits

Learn how to create a budget, explore popular budgeting methods, and develop smarter spending habits to improve your financial well-being.

Tips for Building a Budget and Creating Better Spending Habits | Unison Equity Sharing

person putting work gloves on before doing home maintenance

Maintain Now, Save Later: 10 Home Maintenance Tips That Can Prevent Costly Repairs

Avoid costly home repairs with these simple maintenance tips. Catch small issues early and save money by staying ahead of preventable damage.

Maintain Now, Save Later: 10 Home Maintenance Tips That Can Prevent Costly Repairs | Unison Equity Sharing

Frustrated person, hand on their forehead looking down. 

How to Get Out of Medical Debt

Struggling with medical bills? Learn how to reduce or manage medical debt with proven strategies, from negotiating bills and budgeting tips, to asset-based options like home equity.

How to Get Out of Medical Debt: Smart Strategies to Reduce What You Owe | Unison Equity Sharing

retirement-savings

Wondering how much to save for retirement? Learn realistic savings goals by income level, plus practical tips to plan for retirement – no matter where you're starting.

How Much Should I Save for Retirement? A Realistic Guide for Any Income | Unison Equity Sharing

image of tax document, glasses, a pen and calculator

Why Do We Pay Both Federal and State Taxes?

Curious about the difference between state and federal taxes? Learn why we pay both, what they fund, and what to expect when filing your tax return each year.

State vs. Federal Taxes: What’s the Difference – And Why We Pay Both | Unison Equity Sharing

How Long Will it Take to Do My Taxes?

Wondering how long it’ll take to file your taxes? Learn what affects the time it takes, from tax prep methods to complexity, and how to make next season easier.

How Long Will It Take to Do Your Taxes? What to Expect Based on Your Situation | Unison Equity Sharing

Explore the Unison difference and discover how our Equity Sharing Home Loans can empower your financial freedom.

SURVEY: Hidden Costs of Early 401(k) Withdrawals and Alternatives

Survey: Hidden costs of early 401(k) withdrawals and alternatives. Learn how homeowners are using home equity for financial security amidst economic shifts. Protect your retirement now.

SURVEY: Hidden Costs of Early 401(k) Withdrawals and Alternatives | Unison Home Equity

Should You Use a Home Equity Loan in 2025’s Volatile Market?

Explore how fixed-rate home equity loans offer stability, flexibility, and lower costs during market volatility – and learn if tapping into equity is right for you.

Should You Use a Home Equity Loan in 2025’s Volatile Market? | Unison Home Equity Loans

Building with Wall St sign in front of it

How Market Volatility Impacts Borrowers in 2025 – And How To Stay Ahead | Unison Home Equity Loans

Wondering how market volatility affects borrowing in 2025? Learn how shifting rates, tighter lending, and housing market changes impact loans – and what you can do to stay on track.

Your bathroom is more than just a functional space—it's a personal retreat, a place to unwind and recharge. In 2025, bathroom design beautifully blends luxury with functionality, creating a spa-like experience right at home. Whether you dream of a sleek, modern oasis or a warm, nature-inspired sanctuary, the right upgrades will transform your space into the ultimate escape.<br><br>
The possibilities are endless and exciting! Your bathroom renovation journey opens doors to a world of relaxation and rejuvenation that awaits you each day. With thoughtful design choices, your bathroom will become a sanctuary that reflects your personal style while providing the perfect start and end to every day.<br><br>
Imagine stepping into your newly transformed space, feeling instantly calmed by the ambiance you've created. This isn't just a renovation—it's an investment in your daily wellbeing and home value. The bathroom of your dreams isn't just possible—it's within reach and ready to become your favorite room in the house!<br><br>
<h2>The Spa Experience at Home</h2>
One of the biggest trends in bathroom design is the integration of spa-like features that promote relaxation and well-being. Consider adding:<br><br>
<ul>
<li><b>Luxury walk-in showers:</b> Frameless glass enclosures, rainfall showerheads, and built-in steam functions for a true at-home spa.
<li><b>Soaking tubs:</b> Freestanding bathtubs remain a staple for ultimate relaxation, especially when paired with natural stone or wood accents.
<li><b>Smart bathroom technology:</b> Heated floors, touchless faucets, and customizable ambient lighting create a seamless, comfortable experience.
</ul>
<br><br>

<h2>Aesthetic Meets Functionality</h2>
Bathrooms in 2025 embrace both beauty and practicality. Some of the most sought-after elements include:<br><br>
<ul>
<li><b>Earthy and organic materials:</b> Stone, wood, and natural textures bring warmth and a sense of tranquility to the space.<br><br>

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<li><b>Bold yet calming color palettes:</b> Muted greens, soft blues, and warm neutrals create a peaceful, nature-inspired atmosphere.<br><br>

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<li><b>Floating vanities and sleek storage:</b> Minimalist design with hidden storage solutions keeps the space clutter-free and serene.<br><br>

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</ul><br><br>
<h2>Financing Your Dream Bathroom with Unison’s Equity Sharing Home Loan</h2>

Renovating your bathroom into a luxurious retreat doesn’t have to be financially stressful. With Unison’s Equity Sharing Home Loan, homeowners can access the funds needed for high-end upgrades while keeping monthly payments lower than traditional financing options. This 10-year, interest-only second mortgage allows you to invest in your home’s value while maintaining financial flexibility, thanks to a shared appreciation component.<br><br>

Plus, with Unison’s Capital Improvement Adjustment, any increase in home value due to renovations is excluded from the shared appreciation calculation. That means when you enhance your sanctuary bathroom, you reap the full benefits of your investment.
<br><br>
Transform your bathroom into the spa retreat you deserve—without compromising your budget. Learn more about how Unison can help you finance your home upgrades today!


picture of bathroom with tub in the middle

Did you know your home can finance your sanctuary bathroom?

Did you know your home can finance your sanctuary bathroom? Your bathroom is more than just a functional space—it's a personal retreat, a place to unwind and recharge.

Did you know your home can finance your sanctuary bathroom? | Unison

<h2>What are Liquid Assets and Why Do They Matter?</h2>
Liquid assets aren't actual fluids—they're simply assets that can be quickly converted to cash with minimal value loss.<br><br>
<h3><b>The Basics of Liquidity</b></h3><br><br>
Cash is the most liquid asset—immediately usable for purchases or bills. Other assets range from highly liquid to completely illiquid.<br><br>
<h3><b>Examples of Liquid Assets</b></h3><br><br>
Liquid assets convert to cash quickly. Examples include::<br><br>
<ul>
<li>Cash in your checking or savings account
<li>Money market accounts
<li>Treasury bills
<li>Certificates of deposit (CDs) that are about to mature
<li>Stocks and bonds traded on major exchanges
<li>Mutual funds
</ul><br><br>
<h3><b>Examples of Illiquid Assets</b></h3>
Illiquid assets sell slowly and may lose value if rushed. These include: <br><br>
<ul>
<li>Your home or other real estate
<li>Cars and vehicles
<li>Collectibles (art, antiques, baseball cards)
<li>Business ownership interests
<li>Retirement accounts with withdrawal penalties
</ul><br><br>
<h3><b>Why Liquidity Matters</b></h3>
Liquid assets provide financial security, covering unexpected costs like medical bills or job loss. Advisors recommend keeping 3-6 months of expenses as an emergency fund.<br><br>
<h3><b>Finding the Right Balance</b></h3><br><br>
Liquid assets provide security and flexibility, though they typically offer lower appreciation potential than certain illiquid investments over time. An effective financial strategy balances liquid assets for immediate accessibility with less-liquid investments for long-term growth potential.
Remember: Your optimal balance between liquid and illiquid assets should reflect your situation and appetite for financial risks. <br><br><br><br><br>

<i>The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</i>

What are Liquid Assets and Why Do They Matter?

Learn about liquid assets, their importance in financial planning, and examples like cash, stocks, and bonds. Understand why liquidity matters for emergencies and how to balance it with illiquid assets for long-term growth.

What are Liquid Assets and Why Do They Matter? | Unison Home Equity

In recent years, an alarming trend has emerged across several states: major insurance companies are pulling out of entire markets. From Florida's hurricane-prone coastlines to California's wildfire-vulnerable regions, insurers are reassessing risk and, in many cases, deciding to withdraw completely.<br><br>

If you've received notice that your homeowners insurance provider is leaving your state, you're likely feeling a mix of anxiety and uncertainty. Here's what you need to know and the steps you can take to protect your home and financial security.<br><br>

<h2>Understanding Why Insurers Are Leaving</h2>

Insurance companies operate on risk assessment, and climate change has dramatically altered the calculation in many regions:<br><br>

<b>Increasing natural disasters:</b> More frequent and severe hurricanes, wildfires, floods, and storms mean more claims.<br><br>

<b>Rising rebuilding costs:</b> Construction and material costs have soared, making claims more expensive.<br><br>

<b>Reinsurance challenges:</b> Insurance companies buy their own insurance (reinsurance), which has become more expensive or unavailable in high-risk areas.<br><br>

These factors have led many insurers to conclude that certain markets are no longer profitable, leaving homeowners scrambling for alternatives.<br><br>

<h2>Immediate Steps to Take</h2>
If you've received notice that your insurer is departing, here's what to do:<br><br>
<ol>
  <li><b>Don't Panic, But Act Quickly</b><br>
Your insurer is required to give you advance notice before cancellation. Start researching new insurance options right away. Waiting until the last minute could leave you with fewer choices and higher premiums.

  <li><b>Understand Your Timeline</b><br>
Note the exact date your coverage ends and any instructions about final payments or refunds.
</ol><br><br>
<h3><b>Finding New Coverage Options</b></h3><br><br>
<ol>

  <li><b>Contact Multiple Private Insurers</b><br>
Even if many companies are leaving your state, others may still offer coverage. Contact at least 3-5 insurers or work with an independent insurance agent who represents multiple companies.

  <li><b>Look Into Your State's FAIR Plan</b><br>
Most states offer Fair Access to Insurance Requirements (FAIR) plans – last-resort coverage for homeowners who can't find insurance on the private market. While typically more expensive with more limited coverage, FAIR plans ensure you have basic protection.

  <li><b>Consider Surplus Lines Insurers</b><br>
Surplus lines carriers specialize in higher-risk properties and may offer coverage when standard insurers won't. Be aware that these policies often come with higher premiums and aren't backed by state guaranty funds.

  <li><b>Explore Insurance Pools or Associations</b><br>
Some states have created special insurance pools or associations to provide coverage in high-risk areas. For example, Florida has Citizens Property Insurance Corporation, and California has the California FAIR Plan.
</ol><br><br>

<h2>Making Yourself More Insurable</h2>
While shopping for new coverage, take steps to make your property more attractive to insurers:<br><br>
<ol>

  <h3> <li><b>Invest in Mitigation Measures</b></h3><br><br>

In hurricane-prone areas: Install storm shutters, reinforce your roof, or upgrade to impact-resistant windows.<br>
In wildfire regions: Create defensible space around your home, use fire-resistant materials, and clear vegetation from your roof and gutters.<br>
In flood zones: Consider elevating utilities or installing flood vents.<br>

Many states offer grants or tax incentives for these improvements.

  <li><h3><b>Improve Your Home's Overall Condition</b></h3><br><br>
Fix any existing issues like leaky roofs, outdated electrical systems, or plumbing problems that might concern insurers.

  <li><h3><b>Consider Bundling Policies</b></h3><br><br>
Some insurers may be more willing to take on home insurance if you also bring your auto, life, or other policies to them.
</ol><br><br>

While finding new coverage options, consider VIU by HUB. As a digital insurance brokerage platform, VIU provides personalized access to multiple insurance carriers through one simplified application process. Their insurance advisors specialize in navigating challenging markets like Florida and California, offering expert guidance on available options, potential coverage gaps, and premium-saving opportunities. VIU's technology-enabled marketplace allows homeowners to compare quotes from multiple providers simultaneously, potentially identifying specialty or surplus lines carriers willing to write policies in high-risk areas. Most importantly, their advisors understand the unique challenges facing homeowners in disaster-prone regions and can recommend appropriate mitigation strategies that may improve insurability and reduce costs during this stressful transition.<br><br>

Give the VIU by HUB Advisory Team a call at (833) 431-0352 , Monday through Friday from 8 a.m. to 9 p.m. Eastern. <br><br><br><br><br><br><br><br>

<i>The content on this page provides general consumer information. It is not legal, financial, or insurance advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</i>


Unison provides alternatives to the traditional ways of accessing home equity like HELOCs, reverse mortgages, and second mortgages. 

What Can I Do if My Homeowners Insurance Provider Leaves the State? 

In recent years, an alarming trend has emerged across several states: major insurance companies are pulling out of entire markets. Here's what to do if it happens to you.

What Can I Do if My Homeowners Insurance Provider Leaves the State? | Unison Home Equity Sharing

Many homeowners are struggling to find good ways to use their home's value. Old-style loans are too hard to manage. They come with big monthly bills and strict rules that make it tough for families to have financial freedom.  <br><br>

Imagine a new way to get money from your home. It's called the shared appreciation model. Here's how it works: When your home's value goes up over time, you share some of that extra value with the lender. In return, they give you lower monthly payments and a better interest rate.<br><br>

Think of it like this: If your home is worth $300,000 today and becomes worth $400,000 later, you and the lender would split the $100,000 increase. This means you get money now, and the lender gets a part of your home's future value growth.<br><br>

Unison’s Equity Sharing Home Loan follows the shared appreciation model. The amount you share at the end of the loan is based on how much you borrow—usually 1.5 times the percentage of funds you receive. For example, if you borrow 10% of your home’s current value, Unison will receive 15% of the future appreciation (10 x 1.5 = 15). Please note that with the Equity Sharing Home Loan, Unison does not share in any loss of value. <br><br>

Unison built the Equity Sharing Home Loan to align with the needs of modern homeowners. In addition to the shared appreciation component, the 10-year loan features fixed interest-only payments, which are partially-deferred in order to even further lower the monthly obligation. With improved cashflow, you can use freed-up funds for other investments, whether you want to undertake home improvement projects, pay off debt, or save for retirement. The Equity Sharing Home Loan is purposely designed so that Unison succeeds only when you succeed! <br><br>
If you want to learn more about Unison’s innovative shared appreciation model and how the Equity Sharing Home Loan can help you maintain control of your financial future, speak to one of our experienced mortgage loan officers today!
<br><br><br><br><br><br>

<i>The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</i>

Find out how much home equity you could get with Unison today

couple toasting their cups of coffee while sitting on the couch.

What is shared appreciation?

Many homeowners are struggling to find good ways to use their home's value. Old-style loans are too hard to manage. Imagine a new way to get money from your home. It's called the shared appreciation model.  Learn more about how it works.

What is Shared Appreciation? | Unison

Credit cards with 0% APR promotions seem like a great deal. Whether you’re shopping for a new credit card, or searching for a mechanism for debt consolidation, the opportunity to save on interest can be tremendously appealing. However, it’s important to perform thorough research whenever you’re considering a decision that will affect your finances, and to consider the big picture. <br><br>

<h2>What is a 0% APR Promotion?</h2>

A 0% APR promotion credit card is a type of credit card that offers a promotional period during which you are not charged any interest on purchases, balance transfers, or sometimes both. This introductory period can last anywhere from a few months to over a year, depending on the card issuer and terms. Once the promotional period ends, the card’s regular annual percentage rate (APR) will apply to any remaining balance or new transactions.
<br><br>

<h2>What are the benefits of a Credit Card with a 0% APR Promotion?</h2>

The biggest benefit to a 0% APR promotion is the obvious one–there is no interest for a certain period, during which you can not only make purchases, but also transfer existing high-interest debt without accruing additional interest charges. This feature can be particularly valuable when making large purchases you plan to pay off over time or when consolidating existing credit card debt to save on interest payments.

<h2> What are the potential risks of a Credit Card with a 0% APR Promotion?</h2>

The most significant risk involved with a 0% APR credit card promotion arrives at the end of the promotional period. Any remaining balance will suddenly–and immediately–begin accruing interest at the card's standard variable rate. Bear in mind: this rate is often higher than average due to the generous promotional offer. Plus, some cards even apply deferred interest retroactively if you haven't paid off the entire balance by the end of the promotional period.
<br><br>
It’s also worth keeping in mind that despite the 0% interest during the introductory period, balance transfer cards typically charge a fee of 3-5% of the transferred amount. So, if you are transferring high interest debt onto such a card, those fees might dramatically eat into your savings. <br><br>

Credit cards with 0% APR promotions can also create a false sense of financial security. The availability of interest-free credit might tempt you to make unnecessary purchases or take on more debt than you can comfortably repay before the promotional period ends–at which point, you might be in for a rude awakening!

<h2>A Debt Consolidation Option with Predictable, Low Monthly Payments</h2>

Although we’re often taught to compare APRs when looking at loans and credit cards, you may actually get a clearer picture of what you are going to pay out of pocket by <a href=”https://www.unison.com/blog/homeownership/APR-vs-monthly-payment”>examining the monthly payments</a>. 

<br><br>With a credit card that has a 0% APR promotion, you will still need to make the minimum payment each month, and continue to chip away at the balance to the best of your ability. It may seem like a race to the end of the introductory period, because at that point, the balance will accumulate interest, and your monthly payment will increase. If you’re trying to consolidate and pay off debt, the introductory period may not be long enough for you to realistically achieve your goal. <br><br>

<a href=”https://unison.com”>Unison</a> designed their Equity Sharing Home Loan specifically to empower homeowners with financial flexibility. Structured with partially-deferred interest and an equity sharing component to keep monthly payments as low as possible, the ten-year, fixed interest-only loan offers homeowners the opportunity to save each month, and use those savings however they wish. When it comes to <a href=”https://www.unison.com/blog/home-equity/unison-equity-sharing-home-loan-vs-debt-management-plan”>debt consolidation</a>, the Equity Sharing Home Loan can be an attractive option for homeowners looking for a more practicable way to increase the reach of their finances and move forward, rather than simply restructuring their debt. There are also no prepayment penalties, ensuring that homeowners maintain financial agency. <br><br>

With Unison, there are no surprises. Enjoy half the monthly payment as <a href=”https://www.unison.com/blog/revolutionize-your-home-equity-access”>compared to traditional equity financing options</a>, and maintain peace of mind in the knowledge that Unison also caps both the annualized return on Unison’s share, as well as all forms of interest. Sounds good? Speak to one of their experienced mortgage lending officers today.


Find out how much equity you could access with Unison

A couple reviewing documents at the table

The Hidden Risks of Credit Cards with 0% APR Promotions

Credit cards with 0% APR promotions seem like a great deal if you're searching for a mechanism for debt consolidation. But there can be some risks, too. This article delves into the details.

The Hidden Risks of Credit Cards with 0% APR Promotions | Unison Home Equity Sharing

<i>by Lauren Rosales-Shepard, Content Writer</i><br><br>

Refinancing a second mortgage can be a strategic move to lower your monthly payments, secure a better interest rate, or adjust the terms of your loan. Whether you’re looking to save money or consolidate debt, understanding the refinancing process is essential to achieving your financial goals. This guide will walk you through the steps to effectively refinance a second mortgage.<br><br>

<h2>Steps to Refinance a Second Mortgage</h2>

<ol>
<li><h3><b>Assess Your Financial Health:</b> </h3>Familiarize yourself with your credit score, your DTI (the lower, the better!), and the amount of equity you have in your home.
<li><h3><b>Set Your Refinancing Goals:</b></h3> What do you want to achieve through refinancing? Clarifying your goals will help guide you in your decision. For example, are you looking to reduce your monthly payments, save on total interest, or switch to a different loan type?
<li><h3><b>Shop Around for Lenders:</b></h3> Not all lenders offer the same terms, so it’s crucial to compare options. It can sometimes be difficult to really get a grasp on how much a loan might cost–look at the <a href=”https://www.unison.com/blog/APR-vs-monthly-payment”>monthly payment</a> for a clearer picture.
<li><h3><b>Gather Your Relevant Documents:</b></h3> You should be prepared to provide proof of income (e.g., pay stubs, tax returns), bank statements, details of your existing mortgage(s), etc.
<li><h3><b>Apply for Refinancing:</b></h3> Submit your application to the chosen lender. During this process, the lender will likely review your credit score and financial history, verify your income and employment status, and also order a home appraisal. 
<li><h3><b>Review Loan Terms Carefully:</b></h3> Once approved, the lender will provide a loan estimate outlining the terms. Scrutinize the document to ensure it meets your goals.
<li><h3><b>Close on the Loan:</b></h3>At closing, you’ll sign the new loan documents and pay any required fees. The new loan will then pay off your existing second mortgage, and you’ll begin making payments on the refinanced loan.
</ol>
<br><br>

<h2>Refinancing a Second Mortgage with a Unison Equity Sharing Home Loan</h2>

If the high monthly payments required by your current second mortgage are seriously cramping your style, you might be interested in refinancing with an Equity Sharing Home Loan from Unison. Unison designed the Equity Sharing Home Loan specifically to provide relief for homeowners whose steep monthly debt obligations are stripping them of their financial flexibility. 
The 10-year, interest-only loan empowers homeowners, offering:<br><br>

<ul>
<li><h3><b>Breathable Financial Structure:</b></h3> A ten-year, interest-only loan designed specifically to keep monthly payments low and manageable
<li><h3><b>Partnership Mindset:</b></h3> Through shared appreciation, Unison aligns its success with your home's future value
<li><h3><b>Competitive Rates:</b></h3> Access your equity without the burden of excessive interest charges
<li><h3><b>Financial Freedom:</b></h3> More flexibility to use–or save!-- your funds while maintaining comfortable monthly payments
</ul><br><br>

Unison’s application process is convenient and easy–homeowners have the option of a completely online experience, and our licensed loan experts are happy to help over the phone. If you are searching for a way to refinance your second mortgage for half the monthly payment as other equity financing products, the Equity Sharing Home Loan just may be the right fit!
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<br>
<br>
<br>
<br>
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<i>The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</i>

A couple looking at refinance options on their laptop and a document

How to Refinance a Second Mortgage

Refinancing a second mortgage can be a strategic move to lower your monthly payments, secure a better interest rate, or adjust the terms of your loan. This guide will walk you through the steps to effectively refinance a second mortgage.

How to Refinance a Second Mortgage | Unison Home Equity

A home appraisal is a crucial step in the process of applying for home equity financing. A professional appraiser–a licensed, independent third party–evaluates your property's value based on various factors, including location, condition, and market trends. Follow these key steps to prepare for your appraisal.<br><br>

<h2>Boost Curb Appeal</h2>

First impressions do matter. Consider enhancing your curb appeal by:<br><br>

<ul>
<li>Mowing the lawn and trimming hedges
<li>Power-washing the driveway and sidewalks
<li>Painting the front door or touching up exterior paint
<li>Cleaning gutters and removing any clutter from the yard
</ul><br><br>

<h2>Declutter and Deep Clean</h2>
Take the time to ensure your space is tidy:
<br><br>
<ul>
<li>Declutter rooms and organize storage spaces
<li>Dust and wipe down surfaces
<li>Vacuum carpets and mop floors
<li>Eliminate odors and use air fresheners sparingly
</ul><br><br>

<h2>Make Necessary Repairs</h2>

Make sure that the state of your home shows it has been well-maintained. Address issues such as:
<br><br>
<ul>
<li>Leaky faucets or running toilets
<li>Peeling paint or damaged drywall
<li>Burnt-out light bulbs and broken fixtures
<li>Broken door handles or loose cabinet hinges
<li>Cracked tiles or flooring damage
</ul><br><br>

<h2>Highlight Home Improvements</h2>

If you’ve made any upgrades or renovations, provide a list of improvements for the appraiser. Have the documentation ready but wait for the appraiser to request it. Include details such as:
<br><br>
<ul>
<li>New appliances, countertops, or cabinetry in the kitchen
<li>Updated bathrooms with modern fixtures
<li>Recent HVAC, roofing, or plumbing upgrades
<li>Energy-efficient windows or insulation improvements
</ul>
<br><br>

<h2>Ensure Easy Access</h2>

Appraisers need to inspect various areas of your home, including the attic, basement, and all rooms. Make sure these areas are accessible by:
<br><br>
<ul>
<li>Unlocking doors and gates
<li>Removing obstacles in hallways and storage areas
<li>Providing access to utility systems (furnace, water heater, electrical panel)
</ul><br>
<br>

<h3><b>Final Thoughts</b></h3><br><br>
It’s also a good idea to understand your neighborhood’s real estate market–look up recent sales of similar homes in your area and be prepared to discuss any factors that may positively influence your home’s value.
<br><br>

Remember that major renovations right before an appraisal rarely pay off. Instead, your goal should be to demonstrate that your home has been well-maintained and is consistent with local market values. Focus on repairs and improvements that align your home with neighborhood standards. By following these preparation steps, you'll position your home to receive a fair and accurate appraisal that reflects its true market value. <br><br><br><br><br>

<i>The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</i>

A home equity loan may work for you. Learn more...

Two people doing light repairs to a kitchen

How to Prepare for a Home Appraisal: A Step-by-Step Guide 

A home appraisal is a crucial step in the process of applying for home equity financing.  Follow these key steps to prepare for your appraisal.

How to Prepare for a Home Appraisal: A Step-by-Step Guide | Unison

<i>By Lauren Rosales-Shepard</i><br><br>

Are you looking to boost your credit score? It might be easier and more straightforward than you think! In this post, we’ll lay out some steps you can take to achieve your goal.<br><br>

While we aren't credit counselors, we are happy to provide some commonly shared general consumer information about credit in this article, as sourced from sites such as <a href=”https://www.nerdwallet.com/article/finance/raise-credit-score-fast”>NerdWallet</a> and <a href=”https://www.equifax.com/personal/education/credit/score/articles/-/learn/how-to-improve-credit-score/”>Equifax</a>. We highly recommend that you speak with licensed credit counselors or other experts if you have more questions. <br><br>
 <br><br>

<h2>What is a Credit Score?</h2>

Briefly, a credit score is a number meant to indicate how likely you are to repay borrowed funds on time, representing your creditworthiness to potential lenders. Lenders use your credit score not only to approve or reject your application for a loan, but to determine the terms and rates they want to offer you. Credit scores typically fall between the range of 300-850, with 850 being utterly perfect.   <br><br>

<h2>What Factors Impact My Credit Score?</h2>

There are several factors that affect your credit. Here’s a quick rundown:<br><br>

<ul>
  <li><b><h3>Payment History:</h3></b> Reflects whether you pay bills on time. Late or missed payments lower your score.
  <li><b><h3>Credit Utilization:</h3></b> The amount of available credit that you’re using. The less you utilize, the better for your score.
  <li><b><h3>Credit History Length:</h3></b> Longer credit histories suggest stability.
  <li><b><h3>Credit Mix:</h3></b> Having different types of credit (such as credit cards and loans) can help.
  <li><b><h3>New Credit Inquiries:</h3></b> Too many applications for credit in a short time can hurt your score.
</ul><br><br>

<h2>How Can I Increase My Credit Score?</h2>

Rebuilding your credit can take time. Moving forward, here are some actions you can take:<br><br>

<ol>
  <li><b><h3>Pay off debt:</h3></b> This seems obvious, and often much easier said than done. But bear in mind that late payments, even of a couple of days, can cause your score to drop significantly. Making regular, on-time payments improves your score, end of story.
  <li><b><h3>Keep your credit card balances low:</h3></b> When possible, don’t just pay the monthly minimum! 
  <li><b><h3>Keep credit cards open:</h3></b> Even once you’ve paid off a credit card, consider keeping it open for a small recurring charge, like a phone bill or Netflix subscription, to keep the cards active. If you close a credit card, you might negatively affect your score. 
  <li><b><h3>Only apply for credit when you need it:</h3></b> When you apply for a new account, the lender might perform a hard credit pull, which may hurt your credit scores. 
  <li><b><h3>Dispute any inaccuracies on your credit report:</h3></b> You can do this one today! Start to regularly monitor your credit reports to make sure they’re accurate, and dispute any wrongful charges ASAP.
  <li><b><h3>Ask to increase your credit limit:</h3></b> If you’re in good standing with a card, call to see if you can increase your limit. A higher limit lowers your utilization rate if you maintain the same balance
</ol><br><br>

<h2>Resources to Help You Rebuild Your Credit</h2>

As we said at the beginning of the post–we are not credit counselors. If you have further questions, or would like more specialized help, we recommend checking out these resources:<br><br>

<ul>
  <li><b><h3>Credit Monitoring Services:</h3></b> Credit monitoring tools help track your score and alert you to changes or potential fraud. There are several free options available, such as Credit Karma and MyFICO.
  <li><b><h3>Financial Counseling Services:</h3></b> Nonprofit organizations offer free or low-cost advice on credit and debt management. Take a look at the <a href=”https://NFCC.org”>National Foundation for Credit Counseling</a> (NFCC) and the <a href=”https:// FCAA.org”>Financial Counseling Association of America</a> (FCAA).
  <li><b><h3>Debt Management Tools:</h3></b> Managing debt effectively improves your score. Look for an app that can track your spending and debt payoff progress. 
  <li><b><h3>Debt Consolidation Services:</h3></b> Consider working with a credit counselor or lender for consolidation loans.
  <li><b><h3>Educational Resources:</b></h3> Understanding credit is the first step to improving it. <a href=”https://MyFICO.com</a>MyFICO.com</a> offers detailed explanations of FICO scoring. The <a href=”https://www.consumerfinance.gov/consumer-tools/”> Consumer Financial Protection Bureau</a> (CFPB) offers consumer guides on credit, loans, and debt. Local credit unions often provide free financial literacy programs and credit counseling for members, too. 
<li><b><h3>Professional Assistance:</h3></b> For complex credit challenges, you may want to hire a professional. Certified Financial Planners (CFPs) can offer a long-term strategy for credit and debt.
</ul><br><br>

<h2>An Innovative Option for Debt Consolidation</h2>

If you have multiple sources of debt, you may find it difficult to keep up with the various monthly payments. Consolidating that debt streamlines everything into one monthly payment, making your financial obligations easier to manage.<br><br>

Unison designed the Equity Sharing Home Loan to empower homeowners with financial flexibility. By offering a second mortgage with half the monthly payment as that of traditional home equity loans and lines of credit, we give you the ability to save on your monthly obligation–and use those savings however you wish! In addition, the Equity Sharing Home Loan has a 10-year term, and absolutely no prepayment penalties. With the convenience of a user-friendly online application, you can pursue your debt consolidation goals without added stress. Work with one of our licensed loan officers to start your application today!<br><br><br><br><br><br><br>

<i>The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</i>

Start your journey towards financial flexibility with a Unison Equity Sharing Home Loan.

Tips to Help Improve Your Credit Score

Are you looking to boost your credit score? It might be easier and more straightforward than you think! In this post, we’ll lay out some steps you can take to achieve your goal.

Tips to Help Improve Your Credit Score | Unison Home Equity Sharing

<i>By Lauren Rosales-Shepard, Content Writer</i><br><br><br><br>

“Home equity” is, by textbook definition, the difference between the current market value of a home and the outstanding balance of any mortgages or liens secured by the property. In plain English, it represents the portion of the home that the homeowner effectively owns outright.<br><br>

Understanding your home equity percentage empowers you to make informed financial decisions, manage debt effectively, and build wealth over time. This information is integral to assessing your overall financial position and net worth. Knowing your home equity is valuable; you can make an informed decision to borrow against it or sell the property to realize the equity as cash.<br><br>

<h2>Simple Steps to Determine Home Equity</h2>

What follows is a simplified approach to determining your home equity. In order to obtain the most precise picture of your home equity situation, consider ordering a professional appraisal or consulting with a financial advisor.<br><br>

<ol>
<li><h3><strong>Find your home’s current market value.</strong></h3> <br>
You can estimate your home's current market value by using various methods, such as hiring a professional appraiser to conduct a valuation, checking recent sales prices of comparable properties (comps) in your neighborhood, and using online real estate valuation tools or websites (<a href=”https://zillow.com”>Zillow</a> is a popular one).<br> <br>
<li><h3><strong>Calculate your outstanding mortgage balance.</strong></h3><br>
Obtain the most recent statement from your mortgage lender or servicer; it outlines the remaining principal balance of your mortgage(s), including any accrued interest and fees.<br><br>
<li><h3><strong>Subtract your mortgage balance from your home's market value.</strong></h3><br>
Subtract your outstanding mortgage balance from your home's current market value. The result equals your home equity. For example, if your home is valued at $500,000 and you still owe $200,000 on your mortgage, your home equity would be $300,000.
</ol>
<br><br>
<h2>How to Increase Your Home Equity</h2>

Home equity can grow over time and your property value may naturally appreciate, but there are strategies you can control to grow home equity more quickly. <br><br>

<ul>
<li><strong>Regular Maintenance and Upkeep:</strong> Keep your home well-maintained by promptly addressing repairs and maintenance concerns. Regular maintenance can help preserve the value of your property and prevent more minor issues from escalating into costly problems.
<li><strong>Home Renovations and Improvements:</strong> Invest in renovations and improvements that can increase the value of your home. Focus on projects that offer a high return on investment (ROI), such as kitchen and bathroom remodels, adding square footage, upgrading energy-efficient features, or greatly enhancing curb appeal.
<li><strong>Reducing Mortgage Debt:</strong> Pay down your mortgage principal more quickly by making extra payments or refinancing to a shorter loan term. When you reduce your mortgage balance, you effectively increase your home equity.
</ul>
<br><br>

<h2>How to Use Your Home Equity</h2>

Built-up home equity can be a financial tool to help you achieve life goals. For example:<br><br>

<ul>
<li>tackle home improvement projects
<li>pay off debt
<li>advance your career or start a business
<li>fund big purchases (wedding, college, new car, medical bills, etc.)
<li>supplement retirement income
<li>down payment on a home
</ul>

<br><br>

<h2>Put your Home Equity to Work and Achieve Your Life Goals with Unison</h2>

Unison designed the Equity Sharing Home Loan to empower homeowners with financial agency and flexibility. The innovative financial structure benefits of this 10-year, fixed interest-only loan unite to offer the savvy homeowner a smart alternative to traditional home equity financing. <br><br>

The Equity Sharing Home Loan features:<br><br>

<ul>
<li><b>Interest-Only Payments</b>: Dramatically lower monthly obligations
<li><b>10-Year Term</b>: Extended timeframe for reaching your financial objectives
<li><b>Flexible Payment Options</b>: No prepayment penalties
<li><b>Home Improvement Value Recognition</b>: Eligible for credit from property improvements
<li><b>Capped Returns</b>: Predictable sharing structure for peace of mind
<li><b>Aligned Interests</b>: Unison succeeds only when you succeed
<li><b>Improved Cash Flow</b>: Keep more money in your pocket each month
<li><b>Investment Opportunities</b>: Use freed-up cash to invest elsewhere
<li><b>Debt Consolidation Power:</b>Effectively streamline your finances
<li><b>Increased Financial Flexibility</b>: Maintain control of your financial future
</ul>
<br><br>

While every homeowner's situation is unique, Unison's Equity Sharing Home Loan opens up exciting new possibilities for those seeking to leverage their home's value. If you’re interested in accessing your equity with half the monthly payment as traditional financing options, learn more about Unison’s revolutionary approach to home equity today. <br><br><br><br>

  <i>The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</i>


Invest in your future with a Unison Equity Sharing Home Loan and enjoy the peace of mind that comes with lower monthly payments.

How to Calculate Your Home Equity

Wondering how to figure out how much equity you have in your home? Follow these simple steps to make calculating home equity quick, easy, and stress-free.

How to Calculate Home Equity | Unison Home Equity Sharing

In today's dynamic financial landscape, homeowners have more options than ever to access their home's equity. While traditional home equity loans have been the go-to solution for decades, Unison's innovative Equity Sharing Home Loan is transforming how homeowners can leverage their property's value to achieve their financial goals.<br>

<h2>Traditional Home Equity Loans: The Old Way</h2>

Traditional home equity loans offer a straightforward but rigid approach:<br>
<ul>
<li>Borrow against your equity with a lump sum payment</li>
<li>Fixed monthly payments including principal and interest</li>
<li>Standard interest rates based on market conditions</li>
<li>Your home serves as collateral</li>
</ul>
<br>

While this conventional approach has served homeowners for years, today's financial landscape demands more innovative, flexible solutions.
<h2>Unison's Revolutionary Partnership Approach</h2>
Unison's Equity Sharing Home Loan represents a paradigm shift in home financing, offering a partnership model that aligns with modern homeowners' needs:
<br>
<h3><strong>Innovative Financial Structure</strong></h3>
<ul>
  <li><b>Interest-Only Payments:</b> Dramatically lower monthly obligations with partially-deferred interest
  <li><b>10-Year Term:</b> Extended timeline for achieving your financial goals
  <li><b>Flexible Payment Options:</b> No prepayment penalties
</ul>
<br>
<H3><strong>Unique Partnership Benefits</strong></h3><br>
<ul>
  <li><strong>Home Improvement Value Recognition:</strong> Eligible for property improvements credit
  <li><strong>Capped Returns:</strong> Predictable sharing structure for peace of mind
  <li><strong>Aligned Interests:</strong> Unison succeeds only when you succeed
</ul><br>
   <h3><strong> Enhanced Financial Freedom</h3></strong>

<li><strong>Improved Cash Flow:</strong> Keep more money in your pocket monthly
<li><strong>Investment Opportunities:</strong> Use freed-up cash for other investments
<li><strong>Debt Consolidation Power:</strong> Streamline your finances effectively
<li><strong>Financial Flexibility:</strong> Maintain control of your financial future
</ul>
<br>
<h2>Making an Informed Choice</h2>
While traditional home equity loans continue to serve a purpose, Unison's Equity Sharing Home Loan offers distinct advantages for forward-thinking homeowners. By choosing Unison, you're not just getting a loan – you're gaining a partner invested in your success.<br><br>
<h3><strong>Keys to Success with Unison</strong></h3><br>
<ul>
<li>Understand your credit profile and debt-to-income ratio
<li>Plan for the future with the balloon payment in mind
<li>Consider potential home improvements that could add value
<li>Think long-term about your property's appreciation potential
</ul><br>
<h2>Taking the Next Step</h2>
Ready to experience the future of home equity access? Unison's innovative approach offers the flexibility, partnership, and financial freedom that modern homeowners deserve. While the program includes a balloon payment at term's end, the benefits of lower monthly payments, shared appreciation, and partnership make it an attractive choice for those seeking a smarter way to access their equity.<br>

<br>
<br>
<br>
<i><font size="-1">Explore how Unison can transform your approach to home equity today. Remember to consult with financial professionals to ensure the best fit for your unique situation. The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</font></i></p>

Revolutionize Your Home Equity Access:

While traditional home equity loans have been the go-to solution for decades, Unison's innovative Equity Sharing Home Loan is transforming how homeowners can leverage their property's value to achieve their financial goals.

Revolutionize Your Home Equity Access: Unison's Partnership Approach vs Traditional Home Equity Loans | Unison Home Equity Sharing

Imagine accessing your home's equity without the burden of sky-high monthly payments. Sounds too good to be true? Not anymore, thanks to Unison's groundbreaking approach to home financing.<br><br>

<h2>The Traditional Home Equity Access Dilemma</h2>
For years, homeowners seeking to tap into their home's equity faced limited options. Traditional routes like home equity loans, HELOCs, reverse mortgages, and cash-out refinances each came with their own set of challenges. The common thread? High interest rates and hefty monthly payments that could strain rather than strengthen your financial flexibility.<br><br>
<h2>Enter Unison: Pioneering a Better Way Forward</h2>
As the pioneer of equity sharing, Unison recognized a crucial gap in the market: homeowners needed a smarter way to access their equity without sacrificing their financial freedom. Their solution? The innovative Equity Sharing Home Loan.<br><br>
<h3><strong>Why Unison's Approach To Equity Sharing Stands Apart</strong></h3><br><br>
The Equity Sharing Home Loan represents a fundamental shift in how homeowners can access their equity. Here's what makes it revolutionary:
<ul>
<li><strong>Breathable Financial Structure:</strong> A ten-year, interest-only loan designed specifically to keep monthly payments low and manageable, with partially-deferred interest
<li><strong>Partnership Mindset:</strong> Through shared appreciation, Unison aligns its success with your home's future value
<li><strong>Competitive Rates:</strong> Access your equity without the burden of higher interest 
<li><strong>Financial Freedom:</strong> More flexibility to use your funds while maintaining comfortable monthly payments
</ul><br><br>
<h2>An Equity Sharing Solution Built for Real Homeowners</h2>
Unison's innovation stems from a deep understanding of homeowner challenges. They recognized that traditional equity access methods often forced homeowners to choose between accessing their equity and maintaining financial stability. The Equity Sharing Home Loan eliminates this painful trade-off, offering a path that supports both immediate needs and long-term financial health.<br><br>
<h2>Your Path to Financial Empowerment</h2>
While every homeowner's situation is unique, Unison's Equity Sharing Home Loan opens up exciting new possibilities for those seeking to leverage their home's value. Whether you're planning home improvements, consolidating debt, or investing in your future, this innovative solution offers the financial breathing room you need to achieve your goals.<br><br>
<h3><strong>Take the Next Step</strong></h3><br><br>
Ready to explore a smarter way to access your home's equity? Unison makes it easy:
<ol>
<li>Learn more about the Equity Sharing Home Loan's unique benefits
<li>Get a personalized rate estimate today
<li>Consult with an experienced mortgage loan officer to confirm it's the right fit for your goals
</ol><br><br>
While there's no one-size-fits-all solution for accessing home equity, Unison's innovative approach deserves serious consideration for homeowners seeking financial flexibility with manageable monthly payments.
<br><br><br><br><br>

<i>The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</i>

Explore the Unison equity sharing difference.

Picture of homes in a row with a nice sidewalk in front

How Unison Revolutionizes Home Equity Access

Imagine accessing your home's equity without the burden of sky-high monthly payments. Sounds too good to be true? Not anymore, thanks to Unison's groundbreaking approach to home financing: the Equity Sharing Home Loan.

Breaking New Ground: How Unison Revolutionizes Home Equity Access | Unison Home Equity Sharing

Debt consolidation streamlines multiple different debts into one monthly payment, making your financial obligations easier to track and handle. Many people look into a home equity line of credit when they are struggling to manage multiple debts, but Unison’s Equity Sharing is an innovative alternative and we have licensed loan officers  who can help you. 

<h2>Home Equity Line of Credit (HELOC)</h2>

<p>A HELOC (Home Equity Line of Credit) acts somewhat like a credit card, using your home equity as a line of credit. You can borrow and repay funds during the draw period, typically 5-10 years, and then repay the balance over the next 10-20 years. This flexibility makes it popular for ongoing expenses or consolidating high-interest debt.</p><br><br>

<p>However, HELOCs often have variable interest rates, making budgeting unpredictable. And while the initial interest-only payments can give you some breathing room, you may find yourself in for a financial rude awakening at the end of the draw period when your payments increase. It's crucial to have a disciplined repayment plan and use the funds responsibly to avoid increasing your debt.</p><br><br>

<h2>Unison Equity Sharing Home Loan</h2>

<p>Unison's Equity Sharing Home Loan provides a unique approach to accessing your home equity, offering a model that aligns with modern homeowners' needs. Its innovative structure includes:
</p><br><br>
<ul>
  <li><b>Interest-Only Payments:</b> Dramatically lower monthly obligations
  <li><b>10-Year Term:</b> Extended timeline for achieving your financial goals
  <li><b>Flexible Payment Options:</b> No prepayment penalties
  <li><b>Home Improvement Value Recognition:</b> Get credit for property improvements
  <li><b>Capped Returns:</b> Predictable sharing structure for peace of mind
  <li><b>Aligned Interests:</b> Unison succeeds only when you succeed
</ul><br><br>

<p>Unison designed the Equity Sharing Home Loan purposefully to enhance homeowners’ financial freedom and flexibility. With improved cash flow, you can keep more money in your pocket each month and use the freed-up cash for other investments. And when it comes to debt consolidation? Homeowners can take advantage of the Equity Sharing Home Loan to effectively streamline their finances, all while enjoying the benefits of a user-friendly, completely online  application process. <br><br>

If you’re interested in refinancing a second mortgage for half the monthly payment, speak to one of our licensed loan officers today!<br><br>
</p>
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<i><font size="-1">The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</font></i></p>

person using a calculator and holding their glasses

Unison's Equity Sharing: An Innovative Alternative to a Home Equity Line of Credit (HELOC) for Debt Consolidation | Unison

When considering tools for debt consolidation, learn about the differences between Unison's Equity Sharing Home Loan and a traditional home equity line of credit, or HELOC.

Are you sitting on substantial home equity while juggling monthly debt payments? Many homeowners face this exact dilemma, sometimes even turning to their 401(k) as a last resort for debt consolidation.  Now, there’s an innovative option that can help you streamline your monthly payments and get control of your finances without tapping into your retirement savings: Unison's Equity Sharing Home Loan. <br><br>

<h2>401(k) Loans</h2>

At first glance, borrowing from your 401(k) might seem appealing. It offers quick access to funds with relatively low interest rates, and those interest payments go back into your account. Plus, it won't impact your credit score since it's not reported to credit bureaus.
<br><br>
But here's the catch: while you're borrowing from yourself, you're also borrowing from your future. Your retirement savings lose out on potential market gains, and if you change jobs, you might need to repay the loan quickly.  There are also <a href=”https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-exceptions-to-tax-on-early-distributions”>significant tax penalties</a> to dipping into your 401(k) before retirement, as such withdrawals are subject to income tax, and there is usually an additional 10% tax. Such disadvantages account for why this is usually considered a last resort for debt consolidation. <br><br>

<h2>Enter Unison: A Revolutionary Approach to Home Equity</h2>

Unison's Equity Sharing Home Loan represents a paradigm shift in home financing. Instead of depleting your retirement savings or taking on traditional high-interest debt, Unison offers an innovative approach that could transform your financial future.

<br />

<h2>Here's What Makes Unison Different:</h2>

Lower Monthly Payments: With a 10-year, interest-only structure, you'll enjoy more manageable monthly payments that free up your cash flow.<br><br>

Shared Investment: Rather than charging high interest rates, Unison becomes a partner in your home's future appreciation. This alignment of interests means they succeed only when you succeed.<br><br>

Flexibility First: No prepayment penalties means you're not locked in. Plus, Unison considers home improvements in their appreciation calculations, encouraging you to invest in your property.
<br><br>

<h2>Smart Features for Smart Homeowners</h2>

Unison's program is designed with homeowner empowerment in mind. The partially deferred interest structure means more money in your pocket today, while their capped annualized return ensures predictability for the future. Whether you're consolidating debt, funding home improvements, or investing in your future, Unison provides the flexibility to achieve your goals without sacrificing your retirement savings.<br><br>

<h2>Making the Right Choice</h2>
While both 401(k) loans and Unison's Equity Sharing Home Loan have their place, Unison offers a more innovative and potentially less risky approach to accessing home equity. Yes, there's a payment at the end of the term, but with proper planning and Unison's transparent terms, you can make informed decisions about your financial future.<br><br>

Remember to consider your specific situation, including your credit score, debt-to-income ratio, and long-term financial goals. The key is choosing a solution that not only addresses your immediate needs but also supports your future financial success.
<br />
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<i><font size="-1">Disclaimer: This content is for informational purposes only and does not constitute financial or legal advice. Consider consulting with financial professionals to determine the best option for your specific situation.</font></i>

Partner with Unison and achieve your goals.

Maximize Your Home's Potential: Why Unison's Equity Sharing Could Be Smarter Than a 401k Loan

When looking for ways to consolidate debt, you might think about withdrawing from your 401(k). Unison's innovative Equity Sharing Home Loan can help you avoid borrowing against your future.

Maximize Your Home's Potential: Why Unison's Equity Sharing Could Be Smarter Than a 401(k) Loan | Unison

When it comes to debt consolidation, it's essential to carefully consider your circumstances and choose an option that aligns with your long-term financial goals–there’s no one-size-fits-all solution. However, if you do your research, you can make an informed choice regarding the best tool for your own unique situation. A popular tool that can help you manage your debt is a debt management plan, but if you need a more immediate remedy to get your finances in order, you should also consider Unison’s innovative Equity Sharing Home Loan. Learn more about each of these options below!<br><br>

<h2>Debt Management Plan</h2>

A debt management plan, offered by credit counseling agencies, helps you repay unsecured debts like credit cards and medical bills. A counselor works with you to create a budget and negotiates with creditors to lower interest rates and create a manageable repayment plan. This provides structured support and can be a good option if you're facing financial hardship or want to avoid bankruptcy.<br><br>

However, creditors are not obligated to participate, and fees for the service can vary. It's crucial to evaluate your financial situation, consider the costs involved, and commit to sticking to the plan for it to be successful.<br><br>

<h2>Unison Equity Sharing Home Loan</h2>

Unison's Equity Sharing Home Loan provides a unique approach to accessing your home equity. The 10-year, interest-only second mortgage offers half the monthly payment as traditional home financing options, empowering homeowners with the tremendous financial flexibility to save each month, and use those savings however they wish. The Equity Sharing Home Loan utilizes both partially-deferred interest and a shared appreciation component in order to keep monthly payments more practicable for homeowners who want to increase the reach of their finances.  Unison also caps both the annualized return on Unison’s share, and all forms of interest. This can be an attractive option for homeowners seeking increased cash flow and flexibility, especially with additional features like no prepayment penalties and potential adjustments for capital improvements. 
<br><br>

Ultimately, Unison provides a pathway to potential wealth building while maintaining financial flexibility–instead of merely restructuring debt. To prepare for success, be sure to review  your credit score and debt-to-income ratio, as well as plan for the balloon payment at the end of the loan, before deciding if it aligns with your long-term financial goals. If the answer is “yes,” work with one of their licensed loan officers to start your convenient, online application today!<br><br>

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<i><font size="-1">The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</font></i></p>

woman with piles of pamphlets and letters in front of her 

unison-equity-sharing-home-loan-vs-debt-management-plan

A debt management plan can help you create a strategy to manage your finances, but if you're looking for quick relief, Unison's Equity Sharing Home Loan can consolidate your debt into one monthly payment.

Faster Debt Consolidation Relief with Unison's Equity Sharing Home Loan | Unison Equity Sharing

Making informed financial decisions is crucial for your future success. When looking to consolidate debt or access funds for your goals, it's important to understand how innovative solutions like Unison's Equity Sharing Home Loan can offer unique advantages over traditional options.<br><br>
<h2>Traditional Debt Consolidation: A Common Approach</h2>
Traditional debt consolidation loans serve a straightforward purpose: combining multiple debts into one monthly payment. While this approach can:<br><br>
<ul>
<li>Simplify your monthly payments
<li>Potentially reduce interest rates
<li>Provide a clear repayment timeline
<li>Help manage various types of debt
</ul><br><br>
The challenge? Traditional consolidation simply reshapes existing debt without offering the innovative benefits that modern homeowners deserve.<br><br>
<h2>Unison's Revolutionary Equity Sharing: A Smarter Way Forward</h2>
Unison's Equity Sharing Home Loan transforms how homeowners can achieve their financial goals. This innovative solution offers a powerful combination of benefits that traditional debt consolidation simply can't match:<br><br>
<h3><b>Immediate Financial Freedom</b></h3><br><br>
<ul>
<li>Lower Monthly Payments: Enjoy more financial flexibility with interest-only payments
<li>Improved Cash Flow: Keep more money in your pocket for what matters most with partially-deferred interest
</ul><br><br>
<h3><b>Smart Partnership Features</b></h3>
<br><br>
<ul>
<li>Shared Success: Unison partners in your home's future appreciation, aligning their interests with yours
<li>No Prepayment Penalties: Maintain the flexibility to manage your loan on your terms
<li>Home Improvement Recognition: Benefit from adjustments for capital improvements you make to your property<br><br>
<h3><b>Long-Term Financial Benefits</b></h3><br>
<li>10-Year Term: Plenty of time to achieve your financial goals
<li>Structured Planning: Clear terms help you prepare for the future
<li>Investment Potential: Use freed-up cash flow to invest in your future</ul><br><br>.
<h2>Why Homeowners Choose Unison</h2>
Unison's approach stands out by offering homeowners a true partnership in their financial journey. Instead of just restructuring debt, Unison provides a pathway to potential wealth building while maintaining financial flexibility. The partially deferred interest structure, combined with shared appreciation, creates an innovative solution that traditional debt consolidation loans simply can't offer.<br><br>
<h3><b>Making Your Choice</b></h3>
<br><br>While traditional debt consolidation has its place, Unison's Equity Sharing Home Loan represents the future of home financing. With features designed to empower homeowners, Unison offers a sophisticated solution for those ready to take control of their financial future.<br><br>
<h3><b>Key Considerations for Success</b></h3><br><br>
<ol>
<li>Review your credit score and debt-to-income ratio
<li>Consider your long-term financial goals
<li>Plan for the balloon payment at the end of the term
<li>Evaluate how home improvements might benefit you under Unison's program
</ol><br><br>
Ready to explore how Unison can transform your financial future? Take the first step today by learning more about Unison's innovative Equity Sharing Home Loan program.<br><br>
<i>Remember: Your financial journey is unique. While Unison offers compelling advantages, consider consulting with financial professionals to ensure the best fit for your specific situation.</i>


professional woman discussing something with another person

unison-equity-sharing-home-loan-vs-debt-consolidation-loan

Looking to consolidate debt? Learn more about a traditional Debt Consolidation Loan and the benefits of Unison's Equity Sharing Home Loan as a tool for debt consolidation.

Smart Financial Solutions: Why Unison's Equity Sharing Home Loan Stands Out from Traditional Debt Consolidation | Unison Equity Sharing

<i>by Lauren Rosales-Shepard, Content Writer</i><br><br><br>
Welcome to the third and final blog post in our series, “Beyond Home Equity: How to Finance Your Next Big Expense.” You can read Part II <a href="https://unison.com/blog/beyond-home-equity--retirement-savings-accounts">here</a>. <br><br>

<h2>An Alternate Means to Tapping Into Your Equity</h2>

If you’ve considered accessing your home’s equity as the means to fund a big expense, you’re probably familiar with the usual suspects–<a href="https://www.unison.com/blog/pros-cons-home-equity-loan">home equity loans</a>, home equity lines of credit (<a href="https://www.unison.com/blog/undefined/about-helocs">HELOCs</a>), <a href="https://www.unison.com/blog/reverse-mortgage-payments-costs/">reverse mortgages</a>, and <a href="https://www.unison.com/blog/cash-out-refinance-pros-and-cons">cash-out refinances</a>. Each of these options has its own distinctive characteristics–the reverse mortgage is meant for homeowners over the age of 62, for example, and <a href="https://www.unison.com/blog/tips/how-does-a-heloc-work">HELOCs</a> usually have an interest-only draw period, followed by a repayment period. One reason that many homeowners are historically reluctant to tap into their equity is that doing so often requires costly monthly payments, driven by high interest rates. <br><br>

<a href="https://unison.com">Unison</a>, the pioneer of equity sharing, observed that homeowners were struggling to tap into their equity without the penalty of soaring monthly payments that hampered their financial flexibility. So, through Unison Mortgage Corporation, they launched the <a href="https://unison.com/home-loan">Equity Sharing Home Loan</a>: a ten-year, interest-only loan with a shared appreciation component that empowers homeowners to save money and meet their goals with low monthly payments. With competitive rates, the Equity Sharing Home Loan aims to offer homeowners an innovative way to access their equity–one with financial breathing room. <br><br>

There is no one-size-fits-all method for tapping your home equity for funds. A financial advisor or other professional will be best suited to help you select the best option to fit your unique needs. However, if you are interested in accessing your equity for low monthly payments, <a href="https://unison.com/home-loan">learn more</a> about Unison’s Equity Sharing Home Loan and get a rate estimate today!

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<i><font size="-1">The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</font></i></p>

Cut your monthly payment in half with Unison’s Equity Sharing Home Loan

Beyond Home Equity: How to Finance Your Next Big Expense: Part III

Are you considering a big expense? One of the traditional ways to cover a large purchase is to tap into your home equity--but there are other methods, too. Check out our three-part series to learn more. 

Beyond Home Equity: How to Finance Your Next Big Expense: Part III | Unison

<i>by Lauren Rosales-Shepard, Content Writer</i><br><br><br>

Welcome to the second blog post in our series, “Beyond Home Equity: How to Finance Your Next Big Expense.” If you’re looking to finance a big expense, whether it’s a renovation or a large debt consolidation, you might be considering tapping into your home equity–but, you know you should consider the alternatives as well. Over the next several days, tune in to this series of shorter blog posts that delve into some of your options. You can read Part I <a href="https://unison.com/blog/beyond-home-equity-personal-loans-credit">here</a>. Today: Retirement Accounts and Savings Accounts.

<h2>Retirement Account Loans or Withdrawals</h2>

As a tool for retirement planning, many of us contribute to a retirement account. A 401(k) is an employer-sponsored plan; however, there are also self-managed retirement accounts called Individual Retirement Accounts (IRAs). Though that sum is meant to grow into a fund that will support you when you’re no longer working full time as a senior, it is possible to make an early withdrawal before you reach that stage of life.<br><br>

<h3><b>How does a retirement account withdrawal work?</b></h3><br><br>
There are multiple different factors that come into play if you’re contemplating an early withdrawal from your retirement.<br><br>

<b>Age</b><br><br>

<u>Before age 59.5</u>: Withdrawals from Traditional IRAs and 401(k)s generally incur a 10% early withdrawal penalty. They are also taxed as income. (There are some exceptions to the 10% penalty, such as medical expenses exceeding a certain percentage of your income).<br><br>

<u>Age 59.5 and older</u>: Withdrawals are free of the 10% penalty, but income tax still applies for traditional accounts. Note: Roth accounts are tax-free if the account has been open for at least five years.
<br><br>

<b>Traditional vs Roth</b><br><br>

<u>Traditional 401(k) or IRA</u>: Contributions are made pre-tax, and withdrawals are therefore taxed as ordinary income.<br><br>

<u>Roth 401(k) or IRA</u>: Contributions are made post-tax, so qualified withdrawals (after age 59½, and if the account is five years old) are tax-free.<br><br>

To make a withdrawal, you can log into your account online or otherwise contact your account administrator. Usually, you can opt to receive a lump sum or periodic payments. If you go this route, be sure to plan for the tax impact of the withdrawals, as well as the potential to disrupt your financial goals. It’s a good idea to consult a financial advisor or tax professional to explore your options and understand the long-term effects.<br><br>

<h2>Savings or Emergency Fund</h2>

Conventional wisdom recommends that we have at least three to six months’ worth of living expenses tucked away in a savings account in case of an emergency. Obviously, it doesn’t hurt to have more. If you have meticulously saved, and your savings can cover the major expense and still leave you with six months’ worth of living expenses, it might also be possible to dip into that fund. <br><br>

<h3><b>How does making a withdrawal from savings or an emergency fund work?</b></h3><br><br>

You can withdraw money from your savings account by visiting your bank, or making an online transfer. Because this is money you already essentially have, it is not taxed. You also don’t need to pay interest of any kind. However, if you empty your savings in order to cover a major expense, keep in mind that those depleted funds might not be there later if you truly need them.<br><br>

Continue to <a href="https://unison.com/blog/Beyond-home-equity-alternative">Part III</a>. 

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<i><font size="-1">The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</font></i></p>

Two people looking at financial documents

Beyond Home Equity: How to Finance Your Next Big Expense: Part II

Beyond Home Equity: How to Finance Your Next Big Expense: Part II | Unison Home Equity Solutions

<i>by Lauren Rosales-Shepard, Content Writer</i><br><br><br>

You’re pondering a major expense. Perhaps you’re tired of your cramped galley kitchen, and want to expand the space into a more open floor plan (complete with one of those lovely quartz countertop islands!). Maybe you’ve seen a commercial space for rent and know it would be the perfect place for the coffeeshop and bakery that your neighborhood so desperately needs. Or, you think it’s time to <a href="https://www.unison.com/blog/best-ways-to-consolidate-debt/">consolidate your various debts</a> into a single, more manageable monthly payment. Whatever the reason, you know that you will require a larger sum of money than your savings alone can provide. You’ve heard that home equity has <a href="https://www.cnbc.com/2024/09/11/home-equity-is-at-a-record-high-heres-how-to-tap-it.html">reached record highs</a> for Americans, and you know that there are a <a href="https://www.unison.com/blog/alternative-ways-to-access-home-equity">myriad of ways</a> to access it. Maybe, you think, this might be the best route to take to obtain the funds you need.<br><br>

But let’s make sure you cover all your bases. What are the alternatives to tapping into your home equity to cover a big expense? Over the next several days, tune in to this series of shorter blog posts that delve into some of your options. Today: Personal Loans and Credit Cards.<br><br>

<h2>Personal Loan</h2>

A personal loan enables you to borrow a lump sum of money to pay for a large expense, or variety of expenses. Unlike some other types of loans, a personal loan tends not to dictate what purpose the borrower uses it to fund (i.e. a student loan is specifically for college or graduate school). In most cases, the borrower repays the loan in regular monthly payments, with interest.<br><br>

<h3><b>How do personal loans work?</b></h3><br><br>

Firstly, there are two different types of personal loans: secured and unsecured. A secured personal loan requires that you utilize something as collateral, something that the lender can keep to satisfy your debt if you should default. The collateral can sometimes be a large asset, like a car or a boat, or a cash asset, such as a savings account. An unsecured loan is precisely what it sounds like–a loan that is not secured by any kind of collateral. Due to that lack of collateral, unsecured loans are often considered as more risky for the lender, and therefore the interest rates may be higher to compensate them for that risk.<br><br>

You can apply for a personal loan from a bank, credit union, or online lender. The lender reviews your application, and, if they approve, will offer terms. Once you accept the terms–the length of the loan and the interest rate, for example–the funds will be yours to use however you see fit. Then, you will make monthly payments comprised of a portion of the amount borrowed, as well as interest, until the loan is paid off. <br><br>

Some personal loans require you to cover additional fees, like a credit check fee or a loan origination fee. Plus, if you want to pay off the loan early, some loans may charge a penalty fee. It’s important to research the specifics when you’re shopping for any kind of loan, and a personal loan is no different!<br><br>

<h2>Credit Cards</h2>

You are undoubtedly already familiar with credit cards, those convenient revolving lines of credit. While their distant cousin, the debit card, is used to ferry funds from your checking account, a credit card borrows the money to make purchases. Although many use credit cards for various small or routine charges, it’s  possible to use a credit card–or even multiple credit cards–to cover a large expense, such as a remodel. <br><br>

<h3><b>How do credit cards work?</b></h3><br><br>

When you charge purchases to a credit card, you are meant to repay the balance you borrowed to make those purchases. For whatever portion you do not repay within a certain term–usually, a month–interest is added to that which you owe. Sometimes, when you open a new credit account, there may be a special promotional 0% APR for a set amount of time (often, a year), in which case, interest would not be added. <br><br>

Most major credit cards (i.e. Visa, Mastercard, American Express, Discover, etc.) are available through banks and other financial institutions. Besides acting as a credit line, many cards will also offer certain benefits or rewards, like airline miles, hotel rooms, or cash back on certain purchases. Some stores or retailers will offer a co-branded credit card–for example, Amazon’s Visa or Barnes and Nobles Mastercard. Such cards can include benefits that correspond to the store, or offer extra points when used there that will eventually pay off in rewards. <br><br>

Credit cards are ultra-convenient, but if you can’t make the payments, the interest can really add up. Plus, if you find yourself unable to make the minimum payments on time, you can damage your credit score.<br><br>

Continue to <a href="https://unison.com/blog/beyond-home-equity--retirement-savings-accounts">Part II</a>.

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<i><font size="-1">The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</font></i></p>

AdobeStock 327340214

Beyond Home Equity: How to Finance Your Next Big Expense: Part I | Unison Home Equity Solutions

Our Chief Investment Officer, Matt O’Hara, recently published an article as a member of Forbes Finance Council. In "7 Ways to Tap Into Your Home's Equity," he describes "the ever-evolving landscape of home financing," exploring both traditional options and newer equity sharing alternatives. Read the article <a href="https://www.forbes.com/councils/forbesfinancecouncil/2024/11/14/home-financing-7-ways-to-tap-into-your-homes-equity/">here</a>.<br><br>

7 Ways to tap into your home equity

Our Chief Investment Officer recently published an article as a member of Forbes Finance Council: "7 Ways to Tap Into Your Home's Equity."

Unison on Forbes Council: 7 Ways to Tap Into Your Home's Equity 

<br>
<i>by Jian Tong Chua, Quantitative Research Associate, and Winfield Xu, Director of Data Science</i><br><br>

  <br><br>The 2024 housing market has demonstrated significant growth and resilience, overcoming headwinds from high interest rates to achieve a remarkable surge in home equity. This annual report examines key trends in home equity throughout the year, analyzing both national and regional data to provide a comprehensive overview of the market. <br><br>

Home prices have reached record highs, with the past 12 months showing significant home price appreciation. As of July 2024, the national Case-Shiller Index reported a 4.5% <a href="https://fred.stlouisfed.org/series/CSUSHPINSA">year-over-year increase</a>. Much of this growth occurred in the first half of 2024, with the index rising by 4.7% year-to-date.<br><br>

This surge in home values has substantially boosted homeowner equity. Home equity, defined as the difference between a property's market value and the outstanding mortgage balance, has reached new heights. By the end of Q2 2024, Federal Reserve <a href="https://fred.stlouisfed.org/series/OEHRENWBSHNO">data</a> indicated total homeowner equity across the country had risen to $35 trillion, with the aggregate value of homes surpassing <a href="https://fred.stlouisfed.org/release/tables?rid=52&eid=810420#snid=810447">$48 trillion</a>.<br><br>

<img src="https://images.ctfassets.net/qppku9ygnsbb/596Cjk2NNBP0ARSHnEA6Ga/385a87c937c66794e1739035059d1eca/Home_Equity__Value___Mortgage.png"><br><br>  

<h3><b>Performance Distribution</b></h3><br><br>

While aggregate home equity has increased at the national level, there are significant variations across states and metropolitan areas.<br><br>

<img src="https://contentimages.o-prod.unison.com/images/Map.png">
<br><br>

From September 2023 to September 2024, median home equity growth was positive in 45 out of 50 states. Connecticut (24.6%), New Jersey (22.3%), and Delaware (18.3%) experienced the highest growth in home equity, while Mississippi (-2.1%), Louisiana (-3.9%), and Idaho (-6.5%) saw the largest declines. <br><br>

       <img src="https://images.ctfassets.net/qppku9ygnsbb/3e68upvrnCBsmQLrvfAilu/49fc44b83733e5d20f69ca1279069de7/Median_home_equity_YoY_growth_by_state.png"><br><br>
                                                                                               In dollar terms, Hawaii and California stand out as significant outliers in median home equity, with values of $564,728 and $497,558, respectively—nearly 30% higher than Massachusetts, which ranks third. On the other end of the spectrum, Oklahoma recorded the lowest median home equity at $118,331, amounting to just a fifth of the highest state.<br><br>
                                                                                               <img src="https://images.ctfassets.net/qppku9ygnsbb/3VjoEYt4CrmYDRjI2TNcfE/0fb9287e5167a3e50a887ce662ec6d88/Median_HE_by_state.png"><br><br>                                    

 At a more granular level, Core Based Statistical Areas (CBSAs) also showed notable differences in home equity performance. Dover, Delaware emerged as the top-performing CBSA, with an impressive 35.7% year-over-year increase in home equity. Two CBSAs in New Jersey, Trenton-Princetron and Atlantic City-Hammonton also performed well, rounding out the top 3.<br><br>
 <img src="https://images.ctfassets.net/qppku9ygnsbb/43Vn4AkIHRtibjg77MIjKk/693e1dfc3c2850f034d86f785b3dcd76/Top_MSAs_in_median_home_equity_YoY_growth.png"><br><br>

In contrast, CBSAs in New Mexico experienced the steepest declines. Espanola recorded the largest year-over-year drop at 43.5%, followed by Portales (-32.5%) and Carlsbad-Artesia (-32.2%).<br><br>
<img src="https://images.ctfassets.net/qppku9ygnsbb/PUuz5JzyF9ZWaefKzrhJH/d60a51d5c31b40173b06cfd7374c571d/Bottom_MSAs_in_median_home_equity_YoY_growth.png"><br><br>

 Even greater disparities emerge when examining median home equity levels. The Jackson Micropolitan Statistical Area, spanning Wyoming and Idaho, boasts the highest median home equity in the country at $1,562,4406. <br><br>

<img src="https://images.ctfassets.net/qppku9ygnsbb/1Zq6IhhudG746DXIgEr1Dt/a9cfa351c8f6d259d1874526f1e30f4a/Top_MSAs_in_median_home_equity.png"><br><br>

In fact, the highest median home equity in the country is more than twenty times that of the lowest, which is Pampa, Texas at $71,9837.     <br><br>

<img src="https://images.ctfassets.net/qppku9ygnsbb/3dlYV7e6nPZeKV8eTv9g6G/35e36260aabd37da77535da371848c90/Bottom_MSAs_in_median_home_equity.png"><br><br>

<b><h3>What does this mean for homeowners?</h3></b><br><br>

For most U.S. households, their primary residence is likely their
largest asset. With the strong growth in home prices over the past
few years, home equity has become an increasingly significant
portion of household net worth. As of July 2024, home equity
accounted for more than one-fifth of total household net worth.<br><br>

<img src="https://images.ctfassets.net/qppku9ygnsbb/5YH6H49fRrb53C4fwg6ZpM/31f0f05aa026a4533e3ae5da0267b4ba/Home_equity_share_of_household_net_worth.png"><br><br>

While future home price trends are difficult to predict, the recent rapid pace of price appreciation is historically
uncommon. Over the past three years, the national Case-Shiller Index has increased by more than 14%, a rate
of growth seen only about 7% of the time in the index's history. Given this exceptional performance,
homeowners may want to consider realizing some of these gains, especially if they have liquidity needs.<br><br>

<img src="https://images.ctfassets.net/qppku9ygnsbb/4vw69IHiT277isEQscWitA/c451abdcc649f7a70c18f45e9fae5a08/Case_Shiller_national.png"><br><br>

Unlike more liquid assets like stocks or bonds, home equity is especially challenging to access. Homeowners
typically have three main options for withdrawing equity: cash-out refinancing, home equity loans, or home
equity lines of credit (HELOCs). Over the past year, there has been an <a href="https://fred.stlouisfed.org/series/RHEACBW027NBOG">increase in HELOC activity</a>, possibly
driven by recent interest rate cuts and the growing awareness among homeowners of the significant value they
can tap into for liquidity.  <br><br>

<img src="https://images.ctfassets.net/qppku9ygnsbb/2u92xYi2pMml8jOQCZr7rR/6676362be91716be4a360f663b18dcb3/Revolving_home_equity_loans__all_commercial_banks____Billions_.png"><br><br>

A key distinction between accessing home equity through a HELOC or refinancing versus selling a portion of a
retirement portfolio is that HELOCs and mortgages create debt. While these options provide short-term
liquidity, they also come with the long-term obligation to service the debt.
In recent years, payments on both consumer and mortgage debt have <a href="https://www.federalreserve.gov/releases/dsr/">risen</a> as a percentage of disposable
(after-tax) income.<br><br>

Therefore, while HELOCs offer an appealing way for homeowners to unlock liquidity, it’s
essential to consider whether they have the capacity to manage the ongoing payments that accompany this
debt.         <br><br>

                                                                                               <img src="https://images.ctfassets.net/qppku9ygnsbb/53l67ZbnSQsIfJ5IeT8Bn/2699a746c9ba54e7cde999fa12aca782/Consumer_and_mortgage_debt_to_disposable_income_ratio.png"><br><br>

  Within the evolving home equity market, <a href="https://unison.com/home-loan">Unison's Equity Sharing Home Loan</a> offers a compelling alternative to
traditional second mortgages and HELOCs, particularly in key markets that have seen substantial increases in
home equity. The Equity Sharing Home Loan is currently offered in Florida, Colorado, Utah, Arizona, and
Oregon - states that have experienced median home equity growth of 9.1%, 3.7%, 1%, 0.2%, and -0.9%
respectively over the past year.<br><br>
The Equity Sharing Home Loan combines the benefits of both debt and equity, allowing homeowners to borrow
against their home equity at competitive rates and pay half as much each month as they would with the
competition--starting as low as $455 on a $100,000 loan in November 2024. Unlike standard refinancing,
the distinct structure includes interest-only payments for up to 10 years, providing immediate access to
funds without the financial strain of high monthly costs. Additionally, homeowners can defer a portion of their
payments until the end of the loan term, giving them flexibility without prepayment penalties. This
structure bridges the gap between homeowners' need for accessible capital and their wealth locked in
home equity. It provides liquidity without the higher payment burden typical of traditional home equity
products.                                                                                            
                                       <br><br> For questions about this report, email <a href="mailto:mediadesk@unison.com">mediadesk@unison.com</a> or visit our website at <a href="https://unison.com">unison.com</a>.


Screenshot 2024-12-02 at 2.11.05 PM

2024 Home Equity Report | Unison

A reverse mortgage is a convenient way to <a href="https://www.unison.com/blog/what-is-home-equity-and-how-to-use-it/">use your home equity</a> as a cash source during retirement, but there are some <a href="https://www.unison.com/blog/reverse-mortgage-pros-and-cons/">downsides to a reverse mortgage</a>. Before committing to this home loan option, it's important to familiarize yourself with the dangers of reverse mortgages and learn how to lessen those risks.<br><br>
<ul>
<li><a href="#Understanding">Understanding Reverse Mortgages
</a>
<li><a href="#KeepinMind">What to Keep in Mind with a Reverse Mortgage</a>
<li><a href="#ADifferentOption">An Alternative to Reverse Mortgages</a>
</ul>
<br><br>

<a id="#Understanding"><h2>Understanding Reverse Mortgages</h2></a>
Reserved for homeowners over the age of 62, a <a href="https://www.unison.com/blog/reverse-mortgage-payments-costs/">reverse mortgage</a> is a home loan that allows you to turn part of your equity into accessible cash without having to sell your property. Unlike a traditional mortgage, where a borrower makes payments to the lender, a reverse mortgage requires the lender to make payments to the borrower. <br><br>

You can choose to receive your funds through monthly payments, a lump sum of cash, a line of credit, or a combination of these options. Repayment on a reverse mortgage loan is due when you move out of your home, sell your home, or pass away. <br><br>

Considering the age requirement, reverse mortgages are normally used as a supplementary income source during retirement to help cover medical costs, living expenses, and other financial needs.
<br><br>

<a id="#KeepinMind"><h2>What to Keep in Mind with a Reverse Mortgage</h2></a>

It’s important to consider all aspects of a reverse mortgage if you’re thinking about obtaining one. Be aware of some of the potential downsides and utilize these tips.<br><br>

<h3><b>It May Be Tempting to Misuse Funds</b></h3><br><br>
Not all reverse mortgage dangers are unique to this loan. A downside that comes with reverse mortgages, along with many other types of loans, is that it can be tempting to overspend. With such a large sum of money available to you, it could be easy to lose track of how much you're borrowing.  
<br><br>

<h3><b>You Could Lose Your Home in a Foreclosure</b></h3><br><br>
As with other equity-based <a href="https://www.unison.com/blog/reverse-mortgage-alternatives/">reverse mortgage alternatives</a>, losing your home is the biggest risk of a reverse mortgage. Unexpected financial burdens like rising interest rates or healthcare costs could make it more difficult for you to make payments. And if you fail to pay property taxes, insurance fees, or other home-related costs outside of the loan, your house could be foreclosed. While you never know if these events will happen to you, it's still important to add some cushion into your budget just in case. <br><br>

<h3><b>You Could Be Swimming in High Upfront Costs</b></h3><br><br>

Another reverse mortgage downside is that you'll face higher origination fees than you would with a traditional mortgage. So, you'll have to scrounge up enough funds to pay the upfront charges. But if you're taking out a reverse mortgage for quick access to extra cash, you might not be in the financial position to afford such a hefty payment, creating a major barrier to entry.<br><br>

<h3><b>Your Budget Might Collapse Under Variable Interest Rates</b></h3><br><br>

Reverse mortgages can come with interest rates that fluctuate if they have a variable, rather than fixed rates. In that case, should rates continue to rise over time, homeowners may face less borrowing potential and more financial strain. This means your loan balance could grow significantly by the end of your loan term. So, if your budget is tight, a reverse mortgage with variable rates may not be worth the unpredictability.<br><br>

<h3><b>You’ll Own Less Equity in Your Property</b></h3><br><br>

Borrowing against your equity decreases the amount of equity you have in your home. This is one of the biggest problems with reverse mortgages, as you could be left with less to pass on to your heirs. Another negative effect of reduced home equity is that it could limit your options if you want to downsize later.<br><br>

<h3><b>Shop Around for Lenders</b></h3><br><br>

Before you take out a reverse mortgage, look into multiple lenders and carefully consider their costs, repayment plans, and other terms. Find one that fits your needs and has terms you feel comfortable with based on your budget. Once you find the right lender, be sure to work with them to land on a custom plan that's best for you.<br><br>

<h3><b>Know Your Loan Options </b></h3><br><br>

There are three main types of reverse mortgages:<br><br>
<ol>
<li><b>Home Equity Conversion Mortgages (HECMs):</b> Most common and federally-insured
<li><b>Proprietary Reverse Mortgages:</b> From private lenders and best for homes appraised at high values
<li><b>Single-Purpose Reverse Mortgages:</b> From government and nonprofits, often the least expensive, and carry more limitations
</ol><br><br>
Different costs and terms are associated with each of these loan options, so research them all to figure out which is right for you, your home, and your financial situation.
<br><br>

<h3><b>Trust the Experts</b></h3><br><br>
If you're still on the fence about taking out a reverse mortgage, get some advice! A good financial expert can advise you on the investment options that are suited for your circumstances. You can also take reverse mortgage counseling classes to gain more information.<br><br>

<h3><b>Set a Realistic Budget & Safety Net</b></h3><br><br>

If you're particularly worried about the risk of overspending, have a backup plan. An emergency fund set aside to cover unexpected costs can potentially help you use less of your home loan over time. Taking a close look at your budget and ensuring it's realistic can also help you manage your funds well.<br><br>

<h3><b>Borrow Only What You Need</b></h3><br><br>

The best way to avoid the reverse mortgage risk of overspending is to only borrow what you need. Rather than pulling out excess cash to have as a backup, stick to the amount that covers only the essentials so you're never tempted to overspend.<br><br>

<a id="#ADifferentOption"><h2>An Alternative to Reverse Mortgages</h2></a>

A reverse mortgage comes with a variety of risks, and it's not the right choice for everyone. If you don't meet the reverse mortgage requirements or you want a <a href="https://www.unison.com/blog/alternative-ways-to-get-equity-out-of-home/">home equity alternative</a>, consider Unison's <a href="https://www.unison.com/blog/introducing-unison-equity-sharing-home-loan/">Equity Sharing Home Loan</a>.<br><br>

The Equity Sharing Home Loan is an interest-only, ten-year second mortgage with a shared appreciation component that offers homeowners the opportunity to tap into their equity with low monthly payments. With partially-deferred interest and below-market rates, Unison designed the loan to offer more flexibility for homeowners when it comes to managing their monthly finances. In fact, your monthly payments could be as low as <i>half</i> of what they would be with a traditional equity financing option, such as a HELOC. <br><br>

If you’re looking for a way to tap into your equity but keep your monthly obligation low, <a href="https://unison.com/home-loan">learn more</a> about Unison’s Equity Sharing Home Loan today!<br><br>

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<i><font size="-1">The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</font></i></p>

Learn more about the Unison Equity Sharing Home Loan

Potential Downsides of a Reverse Mortgage

Is a reverse mortgage a good idea? Learn about the potential downsides of a reverse mortgage and find out what you can do to protect yourself.

The Potential Downsides of a Reverse Mortgage | Unison® Equity Sharing | Blog

<i>By Lauren Rosales-Shepard, Content Writer</i><br><br>

During the peak of the <a href="https://www.unison.com/blog/undefined/covid-wfh-part-one">COVID pandemic</a>, many of us were stuck at home. It’s no surprise that, given all this extra time in our houses, there was a resultant surge in home renovations and expansion. However, borrowing costs soon skyrocketed. This slowed home sales and made it prohibitively expensive to tap into home equity to fund larger projects with traditional loan products  like a HELOC.<br><br> 

That’s about to change.<br><br>

<i>The Wall Street Journal</i> is <a href="https://www.wsj.com/economy/housing/home-renovation-loans-2025-858e386d">forecasting</a> that remodeling was not merely a COVID phase, but is ramping again. According to a prediction made by Harvard’s Joint Center for Housing Studies and its Leading Indicator of Remodeling Activity, the annual spending will <a href="https://www.wsj.com/livecoverage/stock-market-today-dow-sp500-nasdaq-live-10-17-2024/card/remodeling-spending-forecast-to-rebound-next-year-5vYJnzcC4aSF1SIaUCz1?mod=article_inline">increase to $477 billion</a> in the first nine months of 2025, nearing the record of $487 billion for all of 2023.<br><br>

More evidence of the resurgence is a recent survey of 475 households, most of which claimed to be waiting for lower rates to use home-equity lines of credit to fund projects. The senior vice president of building products research at John Burns Research & Consulting estimates that this number is just the beginning; he suggests that there is about $30 billion in remodeling spending just waiting for the right moment. <br><br>

That moment may be now. Those who bought homes with historically low mortgage rates during the pandemic aren’t likely to move–perhaps ever–which increases the likelihood that they will renovate or expand instead. Now that the Fed has recently lowered interest rates, households may be poised to tap into their equity to fund new projects. <br><br>

One very popular new housing project is the construction of <a href="https://www.unison.com/blog/homeownership/what-are-adus">“Accessory Dwelling Units”</a> (ADUs). Also commonly referred to as a “granny house” or  “backyard cottage,” an ADU is an additional, self-contained living space attached or adjacent to the primary house on a single family residential lot. Traditionally, as the nickname “granny house” implies, these types of units were often utilized by family members in a multi-generational household. However, in California, <a href="https://therealdeal.com/magazine/november-2024/granny-flats-get-a-glow-up/">recent legislation</a> has both enabled and encouraged the construction of ADUs as rental properties–or even <a href="https://www.planetizen.com/news/2024/08/131136-san-jose-homeowners-can-now-sell-adus-condos">sellable condos</a>. In 2023, Los Angeles County alone permitted <a href="https://www.latimes.com/california/story/2024-07-30/la-is-the-epicenter-of-the-adu-boom-these-surprising-cities-are-building-the-most">more than 45,000</a> ADUs.<br><br>

Why the rising popularity? On the one hand, maintaining an ADU as a rental or even an AirBnb means additional, and eventually passive, income. But there are more wide-ranging benefits as well. ADUs are <a href="https://www.nar.realtor/magazine/real-estate-news/commentary/the-eco-friendly-adu-housing-s-game-changer">inherently sustainable</a>, as they are built on existing properties (particularly in urban areas) and therefore don’t contribute to sprawl. Plus, given their compact size, ADUs take fewer raw materials to build, conserving resources. These units are also seen as a way to <a href="https://www.marketwatch.com/story/adus-are-key-to-solving-the-housing-crisis-heres-what-to-know-b40c7672">mitigate the housing shortage</a>. States like <a href="https://states.aarp.org/massachusetts/adus-by-right-are-now-the-law-in-massachusetts-gov-healey-signs-aarp-backed-housing-bill">Massachusetts</a> and <a href="https://coloradonewsline.com/2024/08/12/colorado-law-opens-doors-wider-adu/">Colorado</a> have followed California’s example, paving the way for more homeowners to develop these small units on their land.<br><br>

Though a <a href="https://www.latimes.com/california/story/2024-09-19/pilot-program-offers-long-beach-homeowners-low-interest-loans">pilot program in Long Beach</a> is offering $250,000 in low-interest loans to build ADUs, most homeowners are turning to their built-up equity to provide the necessary funds for construction. <br><br>

<b><h3>A New Equity Financing Option: the Unison Equity Sharing Home Loan</h3></b><br><br>

When it comes to accessing home equity, there is now an additional option. Unison recently launched the Equity Sharing Home Loan, a ten-year fixed, interest-only second mortgage designed specifically to offer homeowners flexibility in their finances via low monthly payments. Through partially-deferred interest and a shared appreciation component, the Equity Sharing Home Loan endeavors to provide below-market rates that enable homeowners to save each month.<br><br> 

When it comes to renovating or remodeling, the Equity Sharing Home Loan has a particular feature of interest. The Capital Improvement Adjustment is available three years into the loan term, and is intended to offer the homeowner, if they make improvements to the home that boost its value (beyond regular maintenance), the opportunity to apply to maintain all the benefits. In other words, the value added by these improvements would not be part of the future shared appreciation. <br><br>

If you’re one of the many homeowners contemplating a renovation project, but hoping to keep your monthly payments low, <a href="https://unison.com/home-loan">learn more</a> about Unison’s Equity Sharing Home Loan today and get a rate estimate with no obligation. <br><br><br><br>

<i><font size="-1">The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</font></i></p>


Find out how much of your home equity you can access

Renovations are on the Rise, and With Them, ADUs

Renovations are on the rise! Learn more about the upward swing, and the burgeoning Accessory Dwelling Unit trend in this blog post. 

Renovations are on the Rise, and With Them, ADUs | Unison Equity Sharing

<i>by Lauren Rosales-Shepard, Content Writer</i><br><br>

So, you’re in the market for a loan. You know it’s important to do your research and shop around. While you’re undertaking that research, though, and doing that shopping, you continuously encounter interest rates and APR. What’s the difference? And what do they really mean, functionally, for your budget, your spending?<br><br>

As you’re probably aware, an interest rate is the proportion of a loan charged to you, the borrower; it’s typically articulated as an annual percentage of the loan outstanding. When you take out a loan, you ultimately pay back the amount that you borrow, plus the interest–usually in the format of monthly payments. Interest rates can be fixed (which is exactly what it sounds like; the rate does not change), or variable (the rate can change, based on market conditions).<br><br>

APR is the acronym for “Annual Percentage Rate.” Essentially, it’s meant to represent the total annual cost of a loan, from the interest to the portion of the principal being paid, as well as fees. There’s a typical equation used to calculate APR:<br><br>

 (((Interest charges + fees) ÷ Loan amount) ÷ Number of days in loan term x 365) x 100<br><br>

But–good heavens!--that’s a lot to process. The Truth in Lending Act requires lenders to do the calculation for you, and to disclose it whenever they offer you credit, or even display an interest rate. The idea is that an interest rate doesn’t tell the whole story, and consumers are therefore protected against being surprised by any extra fees. <br><br>

That’s all well and good. But, you might ask, how much am I actually going to pay? <br><br>

<h2>Limitations of APR</h2>

First thing’s first, APR isn’t perfect. The lenders have a fair amount of leeway when it comes to selecting the fees to include in its calculation. You may be missing any fees from appraisals or titles, to credit reports or document preparation. Plus, APRs were largely designed for longer-term loans, like a first mortgage. As you might imagine, the average annual impact of mortgage closing costs is much smaller when those costs are assumed to have been spread over 30 years instead of 7 to 10 years. APR also might not accurately reflect your actual repayment behavior. Because it assumes a “standard” repayment plan, if a borrower should make extra payments, or perhaps pay less frequently than monthly, the true cost of borrowing won’t be represented by the APR. <br><br>

<h2>Monthly Payments</h2>

If you’re looking to understand just how much of your monthly paycheck is going to go towards a loan, it makes sense to focus on the actual monthly payment. With most loans, this will be a percentage of the principal, as well as interest. However, some borrowing products have a more unique payment structure.<br><br>

Take Unison’s <a href="https://unison.com/home-loan">Equity Sharing Home Loan</a>. It’s a ten-year, fixed, interest-only loan with a shared appreciation component. In terms of the monthly obligation, homeowners have the option to partially-defer the interest payment to the end of the loan. Unlike standard refinancing, the Equity Sharing Home Loan allows homeowners to borrow against their home equity at below-market rates while keeping monthly payments low—starting as low as $455 on a $100,000 loan*.<br><br>

Unison created the Equity Sharing Home Loan specifically to offer homeowners an alternative to traditional home equity financing that provided more flexibility in their monthly spending. If you want to save more money each month to put towards your goals, <a href="https://unison.com/home-loan">learn more</a> about the Equity Sharing Home Loan today.<br><br>

*For well qualified customers and based on current interest rate as of October, 2024. Rates subject to change. Other terms and conditions may apply.

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<i><font size="-1">The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</font></i></p>


Couple discussing APR vs Monthly Payments

APR-vs-Monthly-Payments

When shopping for a loan, you'll encounter interest rates and APR. But what will you actually pay each month? This post explains APR and suggests that monthly payments may be a better indicator of actual cost.

APR vs Monthly Payments | Unison Home Equity Sharing

<i>by Lauren Rosales-Shepard, Content Writer</i><br><br><br>

<b>Introduction</b><br><br>

	Credit cards have undeniably become an integral part of our financial lives. According to the Federal Reserve, <a href="https://www.forbes.com/advisor/credit-cards/credit-card-statistics/">82% of adults</a> in the United States had at least one credit card in 2022. They are so ingrained in our culture, in fact, that many banks now offer specific <a href="https://www.fool.com/the-ascent/credit-cards/best-kids-credit-cards/">credit cards for children</a> and teenagers–ostensibly, to get a head start in learning financial literacy and building good credit. But why do we as a society seem to like credit cards quite so much? Sure, they’re convenient. Cash is not always practical to carry in large quantities; plus, credit allows consumers to make purchases <a href="https://papers.ssrn.com/sol3/papers.cfm?abstract_id=653382">in accordance with their long-term incomes</a>, rather than weekly, or bi-weekly, paychecks.<br><br>

	Perhaps on the surface, none of this seems like a problem. During the COVID pandemic, for example, the ability to pay without handling the same bills and coins that countless others had been touching was seen as positive. Cash is hardly sanitary! Plus, with the advent of e-commerce, where it is impossible to pay with cash, small online businesses can thrive, and consumers no longer need to live in a large city to have access to the same products. However, easy is not always equal to ‘good.’ The pleasurable feelings that accompany credit card use can also <a href="https://journals.sagepub.com/doi/abs/10.1177/0972262920981428?journalCode=visa">drive compulsive behavior</a> and addiction, so that the convenience factor becomes much more disquieting. And the ‘invisibility’ of cash when cards are used also leads users to spend more–sometimes <a href="https://www.forbes.com/advisor/business/software/people-twice-likely-spend-using-card-than-cash/">twice as much</a>! Out of sight, out of mind. <br><br>

	Therein lies the muddle. In America, credit card debt is currently up more than 12% compared to last year, totalling <a href="https://www.nerdwallet.com/article/credit-cards/average-credit-card-debt-household">more than $1.2 trillion</a>. In other words, the debt is nearly as pervasive as the use. In this report, we will offer an overview of the state of credit card debt in America and try to answer several questions that arise in the process. <br><br>

<b>Credit Card Debt in the U.S. </b><br><br>

	We’ve established the popularity of credit cards, and the fact that the ‘buy now, pay later’ mentality is a major factor contributing to that popularity. However, for a large percentage of Americans, ‘pay later’ doesn’t mean at the end of the month, when the bill comes due. A recent <a href="https://www.bankrate.com/finance/credit-cards/credit-card-debt-report/">BankRates credit card debt survey</a> reveals that 54% of adults carrying a credit card balance have had the debt for less than two years, and one in five reported that they’d had a balance for more than five years–half a decade. Fewer than half of the respondents claimed to have a plan to pay off the debt. This dispiriting data coincides with an online <a href="https://www.nerdwallet.com/article/credit-cards/average-credit-card-debt-household">survey commissioned by NerdWallet</a> in November 2023; among those who reported currently having revolving credit card debt, a hefty one-third admitted that they’ll probably always have some balance carried over from month to month. Just how much debt are we talking about? A <a href="https://www.experian.com/blogs/ask-experian/state-of-credit-cards/">study by Experian</a> found that the average credit card balance among consumers in Q3 2023 was $6,501–exactly 10% more than the previous year. <br><br>

Meanwhile, the interest owed accrues. A 2022 analysis from the Federal Reserve found interest accounts for <a href="https://www.cnet.com/personal-finance/credit-cards/features/maxed-out-inside-americas-credit-card-debt-crisis-and-what-we-do-next/">80% of total credit profitability</a>–in fact, in that year, credit card borrowers were charged a staggering $105 billion in interest. What is possibly most alarming is that a BankRates survey last year found that 43% of cardholders with debt <a href="https://www.bankrate.com/finance/credit-cards/more-americans-carrying-debt-and-many-dont-know-apr">don’t actually know how</a> much interest they’re paying. This lack of knowledge makes a kind of sense; in the same way that credit cards hide the reality of the amount of money one spends, interest charges are likewise invisible. <br><br>

The results of this overwhelming debt are manifest. One–perhaps obvious–consequence is the immense amount of stress that plagues the affected consumers. In the abovementioned <a href="https://www.nerdwallet.com/article/credit-cards/average-credit-card-debt-household">NerdWallet survey</a>, 27% of those surveyed with credit card debt said it’s their number one stressor, and a whopping 22% (nearly a fourth!), claimed that they felt “defeated” by their debt. A slightly less apparent result is that many are being forced to pay down their debt in a never ending battle–at the expense of their emergency savings. According to BankRates annual “Emergency Savings Report,” published in March 2024, <a href="https://www.usatoday.com/story/money/2024/03/10/credit-card-debt-swamps-savings/72894537007/">more than two-fifths</a> of adults said they lacked the savings to cover an emergency expense of $1,000 or more. In fact, the same report finds that 36% of U.S. adults have more credit card debt than emergency savings–the highest since BankRates started asking in 2011. These statistics paint a bleak picture of American consumers, one where they occupy a vulnerable position in which their debt is preventing them from building a financial contingency plan. If anything should go wrong, they will only end up digging themselves deeper into that same debt. <br><br>

So, how exactly did this happen?  There is something inherently seductive about the “'buy now, pay later' philosophy” that credit cards embody which goes <a href="https://www.degruyter.com/document/doi/10.1515/semi.1992.91.1-2.99/html">beyond mere utility</a> and convenience. One <a href="https://mitsloan.mit.edu/experts/how-credit-cards-activate-reward-center-our-brains-and-drive-spending">MIT study</a> found that using a credit card can exploit reward networks of the brain–and, the more we use them, the more we condition ourselves to enjoy the experience. Paying with a credit card feels good. This occurs on a purely neurological level–when we make a purchase with a credit card, additional studies have noted <a href="https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7892835/">strong activation in the striatum</a>–a critical component of the reward system in the brain. Not to mention, at the end of the day, paying with a credit card simply <a href="https://www.nerdwallet.com/article/credit-cards/credit-cards-make-you-spend-more">feels less ‘real’</a> than cash; you aren’t counting it out, bill by bill, and the experience of purchasing is self-contained, limited to the fun part.  And if you combine the convenience of paying with a credit card with this innocuous  façade, you can see just how easy it is to tap into that pleasurable reward center. So, we do. <br><br>

A recent BankRates survey regarding discretionary spending discovered that 38% of adults in the U.S. are <a href="https://www.bankrate.com/credit-cards/news/discretionary-spending-survey/">willing to go into debt</a> for such non-necessities as travel, dining out, and live entertainment. In addition to which, 75% of respondents to a recent Experian survey reported that <a href="https://www.experian.com/blogs/ask-experian/state-of-credit-cards">new or increased bills</a> have impacted their ability to pay down their credit card balances. Recent events reflect this data; student loan repayments are back on (after a respite during COVID), and premiums for both home and auto insurance have increased. Plus, over the last year, inflation saw the price of goods escalate–it’s only logical that more consumers would begin to use credit cards to bridge any monthly shortfall between static income and the increased cost of living. NerdWallet’s abovementioned survey found that <a href="https://www.nerdwallet.com/article/credit-cards/average-credit-card-debt-household">nearly half</a> of Americans with revolving credit card debt (48%) say spending on necessities contributed to their balances.<br><br>

Exceedingly <a href="https://www.vox.com/the-goods/22436051/social-media-credit-card-debt-instagram-tiktok">targeted advertisements</a> have also given us more to buy in the first place, and the repetition of specific ads tailored to our preferences breeds a comforting familiarity that can be difficult to resist. That same repetition also creates and reinforces a sense of truth–i.e. you should want to achieve a specific end (wealth, beauty, status), and the item in question can help you do so. It becomes less of a suggestion and more of a fact. Obviously, the companies want you to buy their products, and credit cards, likewise, increase their profits when you do.<br><br>

Studies have shown that <a href="https://journals.sagepub.com/doi/full/10.1177/00222437211070589">low minimum payments</a> on credit cards can distract the consumer from the actual, larger balance. This is especially the case when users opt into automatic monthly payments and neglect to check the account. In such scenarios, the interest continues to rack up, and often surpasses that which the consumer would have owed in the late fees they were trying to avoid in the first place A <a href="https://onlinelibrary.wiley.com/doi/abs/10.1111/ijcs.12614">gap in financial literacy</a> has also contributed to an (incorrect) assumption that once the minimum payment is made, the user is in the clear. This misconception, however, is in the best interest of the banks and credit card companies, as they make the most profit off of the customers who pay some each month, but <a href="https://www.debt.org/credit/cards/hazards-of-paying-the-minimum-payment-on-your-credit-card/">continue to carry a balance</a>. <br><br>

<b>Conclusion</b><br><br>

There are <a href="https://www.cnet.com/personal-finance/credit-cards/features/maxed-out-inside-americas-credit-card-debt-crisis-and-what-we-do-next/">well over half a billion credit card accounts</a>, according to Experian data. Through these accounts, U.S. consumers drive more than $4.5 trillion in purchases of goods and services annually. That is a lot of use, and it isn’t surprising when paired with the <a href="https://www.nerdwallet.com/article/credit-cards/average-credit-card-debt-household">survey data from NerdWallet</a> regarding credit card users with consistently revolving balances: nearly half (48%) said spending on necessities contributed to their balances, and close to a third (31%) reported the need to use a credit card to make ends meet. Perhaps most tellingly, one-third (33%) said they believe credit cards are necessary to make it in America if you aren’t rich. Ultimately, it’s clear that credit cards are here, and as a society we have made them an integral part of our financial lives. As credit cards continue to weave themselves into the fabric of our society, from such emerging features as “buy now, pay later” and Apple Pay, it’s important to remember that the benefit of convenience is also accompanied by the potential for misuse. <br><br>

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<i><font size="-1">The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</font></i></p>


Report on Credit Card Debt

As collective credit card debt in the U.S. increases, we've written a report to explore the factors that have contributed to it, as well as its overall effect.

Report on Credit Card Debt | Unison

Recently <a href=”https://www.unison.com/blog/unison_renovation_tips/”>decide to renovate your home</a> but not sure how to pay for the home improvements? Whether you're doing seasonal upkeep or preparing to sell your property, home improvement projects can cost serious money that you might not have lying around. From traditional methods like using cash or credit cards to more unconventional options like <a href=”https://www.unison.com/blog/home_improvement_renovation_home_equity/”>tapping into equity for home remodels</a>, here are eight ways to finance home improvements.

<br><br>

<ul>
<li><a href="#Cash">Cash</a>
<li><a href=””#CashOutReFi”>Cash-Out Refinance</a>
<li><a href=”#CreditCard”>Credit Card</a>
<li><a href=”#GovtLoan”>Government Loan</a>
<li><a href=”#HELOC”>Home Equity Line of Credit</a>
<li><a href=”#HomeEquityLoan”>Home Equity Loan</a>
<li><a href=”#HomeImprovementLoan”>Home Improvement Loan</a>
<li><a href=”UnisonESHL”>Unison’s Equity Sharing Home Loan</a>
</ul><br><br>
<a id=”#Cash”><h2>Cash</h2></a>

One of the most common ways to fund home improvements is by saving up cash. Due to the lack of interest payments and closing costs, saving is also one of the least expensive home renovation financing options. However, building up enough cash to complete all the projects around your house can be difficult if you're limited on time.<br><br>

It’s generally recommended to save <a href=”https://www.statefarm.com/simple-insights/residence/how-to-budget-and-save-for-home-maintenance”>1% to 4% of your home's value</a> for maintenance and repairs that come up, although major renovations might require additional savings. Then, with every project, set a realistic budget. If you lack the funds for a complete overhaul, prioritize only making essential repairs. Similarly, it's best to focus on improving one room at a time to avoid going over budget.<br><br>

So, should you pay cash for home improvements? Consider these pros and cons of saving money for home improvements.<br><br>

<table style="border: 1px solid black;">
<tbody>
<tr>
<td style="border: 1px solid black;"><b>Pros</b></td>
<td style="border: 1px solid black;"><b>Cons</b></td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>Less Costly:</b> Cash does not accrue interest or debt and is generally a less expensive payment solution.</td>
<td style="border: 1px solid black;"><b>Depleted Savings:</b> Overextending on your home improvement project can cause financial issues if emergencies that aren’t budgeted for arise.</td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>No Impact on Credit:</b> Saving up money to pay with cash will not negatively impact your credit score.</td>
<td><b>Delayed Start:</b> Paying with cash requires you to wait to start renovations until after you’ve saved up the necessary amount.</td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>Simple Payment:</b> Using cash for home improvements is straightforward and prevents adding the burden of additional monthly payments.</td>
<td style="border: 1px solid black;"><b>Limited Flexibility: </b>If unexpected issues come up or a project’s scale increases, you may not have sufficient funds to cover additional expenses.</td>
</tr>
</tbody>
</table><br><br>

<a id=”#CashOutReFi”><h2>Cash-Out Refinance</h2></a>

Cash-out refinancing is a <a href=”https://www.unison.com/blog/refinancing_tips/”>low-stress refinancing strategy</a> in which homeowners convert home equity into cash by replacing their existing mortgage with a new, larger one. The difference between these two mortgage amounts can then be "cashed out" through a lump sum payment to help you finance home improvements. <br><br>

Cash-out refis are repaid through monthly payments and are ideal for homeowners who expect to live in their homes for a long time. Although requirements can vary by lender, <a href=”https://www.unison.com/blog/how-long-to-get-cash-out-refinance/”>receiving approval for a cash-out refinance</a> typically requires a good credit score, a stable source of income, and roughly at least 20% equity in your home.<br><br>

To determine if this option is best for you, review the following cash-out refinancing pros and cons.<br><br>

<table style="border: 1px solid black;">
<tbody>
<tr>
<td style="border: 1px solid black;"><b>Pros</b></td>
<td style="border: 1px solid black;"><b>Cons</b></td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>Larger, Immediate Funds:</b> Homeowners receive a lump sum (up to 80% of your home’s value) which can immediately be put toward home improvements.</td>
<td style="border: 1px solid black;"><b>Decreased Home Equity:</b>  Replacing your previous mortgage with a new one eliminates the equity you’ve built up in your home.</td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>Lower Interest Rates:</b> Interest rates for mortgages are typically lower than other forms of borrowing.</td>
<td><b>Higher Debt:</b> Cash-out refis are affected by market fluctuations and may lead to increased monthly mortgage payments and higher overall debt.</td>
</tr>
</tbody>
</table><br><br>

<br><br>

<a id=”#CreditCard”><h2>Credit Card</h2></a>

When used in appropriate circumstances, credit cards can be an effective, low-cost method of paying for home renovations. Since balances must be paid off regularly, credit cards are best to use for minor repairs, cosmetic updates, minimal maintenance tasks, and other small improvements that you can easily pay off over time. This home repair finance option is also preferable for urgent projects that demand quick access to cash, but aren't substantial enough to warrant larger home repair loans.<br><br>

Most credit card companies require you to have a good/excellent credit score. To choose the best credit card for home improvements, look for favorable terms like low or 0% APR, no annual fees, and cash-back rewards. <br><br>

Here are some of the benefits and drawbacks of using credit cards to afford home renovations.<br><br>

<table style="border: 1px solid black;">
<tbody>
<tr>
<td style="border: 1px solid black;"><b>Pros</b></td>
<td style="border: 1px solid black;"><b>Cons</b></td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>Minimal Qualification Requirements:</b> Besides creditworthiness, credit cards are generally easier to qualify for compared to some loans for home renovations. </td>
<td style="border: 1px solid black;"><b>Impact on Credit Score:</b> If you do not make minimum monthly payments, you’ll see a negative impact to your credit score.</td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>No Collateral Required:</b> Unlike home remodeling loans that use your house as collateral, credit cards do not put your assets at risk.</td>
<td><b>Credit Limits</b> Credit cards come with a maximum charge limit and may not be able to support large home renovations.</td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>Rewards Points:</b> Some credit cards offer cash-back rewards for home improvement purchases.</td>
<td style="border: 1px solid black;"><b>High Interest Rates:</b> After the introductory period ends, standard credit card rates can be significant and leads to increased debt if not properly managed.</td>
</tr>
</tbody>
</table><br><br>

<br><br>

<a id=”#GovtLoan”><h2>Government Loan</h2></a>

The federal government provides many house renovation loans, including Title I Loans and FHA 203k rehab loans.<br><br>

<a href=”https://www.hud.gov/program_offices/housing/sfh/title/ti_abou”>Title I Loans</a> are offered by the <a href=”https://www.hud.gov/program_offices/housing/fhahistory”>Federal Housing Administration</a> (FHA) to help homeowners pay for necessary home improvements and repairs. This home improvement financing option is great for individuals who don't meet the credit or equity requirements to secure other types of loans.   <br><br>

<a href=”https://www.hud.gov/program_offices/housing/sfh/203k/203k--df”>FHA 203k rehab loans</a>, on the other hand, help you buy a property that requires substantial repairs. These mortgages are insured by the FHA and allow you to work with an approved contractor to renovate parts of the property, make extensive structural repairs, or eliminate safety hazards.<br><br>

Although those with poorer credit scores are eligible for Title I loans, they often still require you to have a <a href=”https://www.unison.com/blog/what-is-good-debt-to-income-ratio/”>decent debt-to-income ratio</a>, as well as proof that you make enough money to cover the proposed payments. Qualifying for FHA 203k loans usually requires a good credit score and a <a href=”https://www.nerdwallet.com/article/mortgages/fha-203k-renovation-loan”>3.5% down payment</a>.<br><br>

Taking out a loan for home improvements comes with several advantages and disadvantages. These are the main ones. <br><br>

<table style="border: 1px solid black;">
<tbody>
<tr>
<td style="border: 1px solid black;"><b>Pros</b></td>
<td style="border: 1px solid black;"><b>Cons</b></td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>Fixed Interest Rates:</b> Many government-backed home renovation loans come with fixed interest rates, so you can expect consistency to more easily budget for monthly payments. </td>
<td style="border: 1px solid black;"><b>Limited Loan Amounts:</b> Limits for FHA loans are lower than other forms of borrowing and may not be able to cover costly renovations.</td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>Lower Interest Rates:</b> Government home repair loans typically come with more competitive interest rates as opposed to traditional loans.</td>
<td style="border: 1px solid black;"><b>Insurance Premiums:</b> Many FHA loans come with upfront mortgage insurance costs, which add to the overall loan expenses.</td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>Less Strict Requirements:</b> With no equity requirement and more flexible credit requirements, government loans may be more accessible for you.</td>
<td style="border: 1px solid black;"><b>Long Processing:</b> Government loans can require more paperwork and longer processing times for closing compared to other types of loans.</td>
</tr>
</tbody>
</table><br><br>

<br><br>

<a id=”#HELOC”><h2>Home Equity Line of Credit</h2></a>

A <a href=”https://www.unison.com/blog/about-helocs/”>home equity line of credit</a> (HELOC) loan is a revolving line of credit with <a href=”https://www.unison.com/blog/home-equity-loan-heloc-application-approval-process/”>a process</a> much like a credit card. <a href=”https://www.unison.com/blog/how-does-a-heloc-work/”>HELOCs work</a> by using your home as collateral, allowing you to unlock your home's equity up to a certain credit limit in order to finance major home projects. Funds can be accessed on an as-needed basis via credit cards, electronic transfer, and/or checks. <br><br>

Once you've used up the allotted funds, you'll enter a repayment process to pay off the principal and accrued interest through monthly installments. The specific amount you can borrow through a HELOC depends on your credit score, income, and the amount of equity you own in your home. <br><br>

Check out the <a href=”Check out the pros and cons of home equity lines of credit to see if this option aligns with your goals.
“>pros and cons of home equity lines of credit</a> to see if this option aligns with your goals.<br><br>

<table style="border: 1px solid black;">
<tbody>
<tr>
<td style="border: 1px solid black;"><b>Pros</b></td>
<td style="border: 1px solid black;"><b>Cons</b></td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>Draw Period:</b> During the draw period, the homeowner typically only needs to make interest-only monthly payments on the funds they access. </td>
<td style="border: 1px solid black;"><b>Risk of Overspending:</b> The temptation to overspend on large home improvements can result in substantial debt.</td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>Flexible Access to Cash:</b> You can access your HELOC funds through many means and there are few limits on how and when you can use them.</td>
<td style="border: 1px solid black;"><b>Variable Rates:</b> Many HELOCs have variable, rather than fixed interest rates, which can lead to unpredictability and difficulty budgeting.</td>
</tr>

</tbody>
</table><br><br>

<br><br>

<a id=”#HomeEquityLoan”><h2>Home Equity Loan</h2></a>

Home equity loans, also known as closed end second mortgages, involve a homeowner borrowing against the equity built up in their home. Unlike other home renovation financing options, home equity loans provide a single lump sum payment with stable monthly repayment rates, ideal for large renovation projects that require a significant amount of cash on short notice. <br><br>

Qualifying for a home equity loan requires a strong credit score, a consistent source of income, a good debt-to-income ratio, and owning 15% to 20% equity in your home. <br><br>

Learn more about the main <a href=”https://www.unison.com/blog/pros-cons-home-equity-loan/”>advantages and disadvantages of home equity loans</a> if you're still on the fence about how to pay for a home remodel.<br><br>

<table style="border: 1px solid black;">
<tbody>
<tr>
<td style="border: 1px solid black;"><b>Pros</b></td>
<td style="border: 1px solid black;"><b>Cons</b></td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>Immediate Lump Sum:</b> Borrowers receive a single lump sum to pay for urgent home renovation costs. </td>
<td style="border: 1px solid black;"><b>Additional Mortgage:</b> Home equity loans are a second mortgage payment, which can increase financial stress on homeowners who are already struggling.</td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>Low, Fixed Interest Rates:</b> Regardless of market conditions, home equity loans offer a fixed interest rate that’s often lower than other forms of borrowing like credit cards.</td>
<td style="border: 1px solid black;"><b>Equity Loss:</b> A drop in the real estate market may lead to diminished equity or even negative equity with loans exceeding your property’s value.</td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>Predictable Repayment:</b> With set repayment periods, you’ll be able to appropriately budget for payments and have a clear idea of what you owe.</td>
<td style="border: 1px solid black;"><b>Risk of Foreclosure:</b> There is a risk of foreclosure with a home equity loan in the case that you fail to make your mortgage payments.</td>
</tr>
</tbody>
</table><br><br>

<br><br>

<a id=”#HomeImprovementLoan”><h2>Home Improvement Loan</h2></a>

As the name suggests, home improvement loans are personal loans that are specifically designed to help homeowners pay for home renovations, repairs, or remodels. Because they are unsecured, home repair loans might be the right choice for you if you prefer not to use assets, like your home, as collateral.<br><br>

These loans for home renovations are generally paid back in fixed amounts every month for a few years. To get a home renovation loan, lenders will consider your creditworthiness. This home renovation funding solution also typically requires a proof of stable income and a low debt-to-income (DTI) ratio to qualify.<br><br>

If you're wondering how to pay for home renovations without risking your house, turn to the pros and cons of home improvement loans.<br><br>

<table style="border: 1px solid black;">
<tbody>
<tr>
<td style="border: 1px solid black;"><b>Pros</b></td>
<td style="border: 1px solid black;"><b>Cons</b></td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>No Collateral Required:</b>Unsecured personal loans do not use assets like cars, homes, or savings accounts as collateral, putting you at less risk. </td>
<td style="border: 1px solid black;"><b>Higher Interest Rates:</b> Without collateral to secure the loan, home improvement loans often have higher interest rates.</td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>Fixed Interest Rates:</b> Home improvement loans often come with fixed interest rates and more predictable payments.</td>
<td style="border: 1px solid black;"><b>Strict Requirements:</b> Requirements to get approved for a home improvement loan tend to be stricter than secured loans.</td>
</tr>
<tr>
<td style="border: 1px solid black;"><b>Quick Funding:</b> These loans typically have a quicker approval process, meaning you can gain access to funds more immediately.</td>
<td style="border: 1px solid black;"><b>Borrowing Limits:</b> The amount of money you can access through home improvement loans is often lower than other forms of borrowing.</td>
</tr>
</tbody>
</table><br><br>

<br><br>

<a id=”#UnisonESHL”><h2>Unison’s Equity Sharing Home Loan</h2></a>

Unison’s <a href=”https://www.unison.com/blog/undefined/introducing-unison-equity-sharing-home-loan”>Equity Sharing Home Loan</a> is an interest-only, ten-year second mortgage, which innovatively combines aspects of a traditional home equity loan and Unison’s own <a href=”https://www.unison.com/blog/undefined/equity-sharing-agreements/”>equity sharing agreement</a> and empowers homeowners to tap into their equity to make home improvements. <br><br>

A shared appreciation component enables Unison to offer below-market rates*, which, with partially-deferred interest, adds up to low monthly payments for the homeowner! At the end of the loan, the homeowner pays back the principal, any deferred compounded interest, as well as a percentage of the home’s appreciation. Unison’s share in the home's future appreciation is fixed at the beginning of the origination process, and the amount is proportional to the amount of the Equity Sharing Home Loan–typically, 1.5x the percentage borrowed. For example, if you borrow 10% of your home’s current value, Unison will receive 15% of the future appreciation.<br><br>

Unison welcomes homeowners with a FICO score of 680 and above, a maximum combined loan to value ratio of 70%, and a debt-to-income ratio not exceeding 40%.<br><br>

<b><h3>Benefits of the Equity Sharing Home Loan</h3></b><br><br>

<b>Below-Market Interest Rates for Second Mortgages:</b> The shared appreciation component enables Unison to offer lower rates. <br>
<b>Low Monthly Payments:</b> Enjoy flexibility with your monthly finances. You only pay up to 75 percent of your loan’s interest each month and defer the remaining 25 percent to the end of the loan.<br>
<b>Flexible Terms:</b> There is no prepayment penalty if you decide to pay off sooner.<br>
<b>Hold on to Your Equity:</b> Unison shares in a portion of the future appreciation of your home, not the equity you’ve already built.<br><br>

<a href=”https://www.unison.com/home-loan/”>Learn more</a> about the Unison Equity Sharing Home Loan today to discover how you can put your home's equity to work on financing the home renovation of your dreams.<br><br>
<br><br><br>

*Based on an internal analysis and review through July 2024 of interest rates for second-lien home equity loans.<br><br><br><br>

<i>The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</i>


A couple looking at their phone and laptop thinking about different ways to pay for home improvement. 

How to Pay for Home Improvements

Need to take out a loan for home renovations? From home improvement loans to HELOCs, here are nine of the best ways to finance home improvements & repairs, including Unison’s Equity Sharing Home Loan.

How to Pay for Home Renovations—Find the Best Loan for You | Unison

By Lauren Rosales-Shepard, Content Writer<br><br><br><br>

You’ve probably heard that your home is your most valuable asset, that you (and so many homeowners across the country) are sitting on a tremendous amount of equity. But what does that mean, exactly? And what is it good for, in practice? <br><br>

“Home equity” is the difference between the market value of your home and the amount you owe on your mortgage–i.e. subtract the amount you owe on your mortgage from your home’s current market value and, voilà, you’ve got your home equity. <br><br>

Homeownership allows you to build equity over time both as you pay down your mortgage, and property values appreciate. This equity contributes to your overall net worth; it’s a valuable asset that can provide financial security, flexibility, and opportunities for homeowners. Because home equity isn’t exactly a <i>tangible</i> thing, there are <a href=”https://www.unison.com/blog/alternative-ways-to-get-equity-out-of-home/”>multiple different products</a> that can help you tap into that home equity and translate it into something liquid: cash. Traditionally, homeowners have used <a href=”https://www.unison.com/blog/about-helocs/”>HELOCs</a>, <a href=”https://www.unison.com/blog/home-equity-loan-vs-heloc/”>home equity loans</a>, <a href=”https://www.unison.com/blog/cash-out-refinance-pros-and-cons”>cash-out refinances</a>, or <a href=”https://www.unison.com/blog/reverse-mortgage-payments-costs”>reverse mortgages</a> to harvest their equity. By leveraging home equity wisely and responsibly, you can maximize its potential benefits, enhance your overall financial well-being, and even build wealth. How is that? Read on to find out.<br><br>

<h2>Make Home Improvements</h2>

When you make <a href=”https://www.unison.com/blog/best-home-improvements-to-increase-value/”>strategic home improvements</a>, you can increase your home’s value. And as we described above, as your home’s value goes up, so, too, does your equity. That said, the key word here is <i>strategic</i>--not all renovations are equal, when it comes to adding value to a home. <br><br>

<ul>
<li><b>Curb Appeal:</b> A well-maintained and attractive exterior can make a positive first impression on potential buyers and increase your home's market value. Enhancing the exterior of your home with landscaping, fresh paint, updated siding, or a new roof can all accomplish this objective.
<li><b>Kitchen Renovation:</b> The kitchen is often considered the heart of the home and a key selling point for buyers. Upgrading outdated appliances, countertops, cabinets, and fixtures can modernize the space and lead to higher resale value.
<li><b>Bathroom Remodel:</b> Renovating bathrooms can significantly increase your home's value. Updating fixtures, adding storage, replacing old tile, and upgrading the shower or bathtub can enhance both functionality and aesthetics. 
<li><b>Energy Efficiency Improvements:</b> Installing energy-efficient features, such as new windows, doors, insulation, and HVAC systems, can reduce utility costs and increase your home's value, especially as energy-efficient homes are in high demand among buyers seeking to lower their energy bills and reduce their environmental footprint.
<li><b>Home Expansion or Addition:</b> Adding square footage to your home through expansions or additions, such as a new bedroom, bathroom, or living space, can significantly increase its value. Additional square footage can improve functionality and accommodate growing families.
  <li><b>Basement or Attic Conversion:</b> Finishing an unfinished basement or attic can add valuable living space to your home. Converting these areas into bedrooms, recreational rooms, or home offices can significantly increase your home's usable square footage.
<li><b>Maintenance and Repairs:</b> Addressing deferred maintenance issues and making necessary repairs can help maintain your home's value and prevent depreciation over time. Regular maintenance, such as roof repairs, HVAC servicing, and exterior painting, shouldn’t be ignored.
</ul>
<br><br>

<h2>Consolidate Debt</h2>

High-interest debt can hinder wealth-building in several ways. Such debt can eat into your income and consume a significant portion of your monthly budget. Think of it like this: the more money you spend on interest payments, the less you have available to spend otherwise. The strain on your monthly cash flow makes it difficult to cover essential expenses, save for emergencies, or invest in wealth-building opportunities. <br><br>

Using home equity to consolidate debt can free up money and improve your financial health.<br><br>

<ul>
<li><b>Lower Interest Rates:</b> Credit cards, personal loans, and other forms of unsecured debt often have the highest interest rates. By consolidating high-interest debt into a single, lower-interest loan, you can reduce the overall cost of borrowing and save money on interest payments over time.
<li><b>Single Monthly Payment:</b> Consolidating multiple debts into a single loan simplifies your monthly finances and makes it easier to manage your debt. Rather than juggling multiple payments with different due dates and interest rates, you'll have simply one convenient payment to make each month, streamlining your budgeting process and reducing the risk of missed payments.
<li><b>Extended Repayment Terms:</b> Home equity financing solutions frequently have longer repayment terms than unsecured loans or credit card debt. By extending the repayment period, you can lower your monthly payments and improve your cash flow, making it easier to manage your debt and meet your financial obligations.

</ul>
<br><br>

<h2>Pay Off College Tuition</h2>

Pursuing higher education isn’t cheap. But education and the development of new skills can lead to future income growth in several ways. Home equity financing can cover tuition expenses for formal education programs, such as college, university, vocational school, or trade school. They can also be used to fund advanced degrees, such as master's degrees or doctoral programs, that lead to specialized knowledge and expertise in a particular field. Generally, earning an advanced degree can enhance your professional qualifications, increase your earning potential, and position you for leadership roles or higher-paying positions in your chosen industry.<br><br>

However, while investing in education can lead to future income growth and career advancement, it's essential to weigh the potential return on investment and ensure that the benefits outweigh the costs of borrowing. Most importantly, be sure to explore alternative financing options, such as scholarships, grants, employer tuition assistance programs, or personal savings, before turning to home equity financing for this use case.

<h2>Advance Your Career</h2>

If you have a business idea or entrepreneurial venture you want to pursue, tapping into your home equity can provide the initial capital needed to start your business. These funds can be used to cover startup costs, such as purchasing equipment, leasing office space, hiring employees, or funding marketing efforts. In addition, if you already own a business and are looking to expand operations, your home equity can provide the necessary funds to grow your business. Whether you're opening a new location or launching a new product line, home equity financing can support your business expansion goals.

<h2>Buy More Real Estate</h2>

You could also use your home equity to fund the downpayment on an additional property, one intentionally purchased as an investment opportunity. Investment properties can:

<br><br>
<ul>
<li>provide a steady stream of passive income from the rental payments from tenants
<li>diversify your income streams and  balance out the volatility of other investments, such as stocks or bonds
<li>furnish financial stability by supplementing retirement savings and otherwise compounding your wealth over the long term via additional investments
</ul>
<br><br>

<h2>Diversify Your Investment Portfolio</h2>

We’ve all heard the old adage not to “put all your eggs in one basket.” That advice holds true for investments–it’s best to spread them out between different asset classes to decrease the risk. If you tap into your home equity, a financial advisor could help you select mutual funds, bonds, and other potential investment opportunities with which to diversify your portfolio.  

<h2>Build Your Emergency Fund</h2>

Your savings are there for the future–whether in case of an emergency, or to set you up in your retirement. Retirement savings not only allow you to maintain your standard of living after you stop working, but they can also cover healthcare costs, which we are more likely to accrue later in life. Plus, if you need to perform any renovations in order to <a href=”https://www.unison.com/blog/downsizing-vs-aging-in-place/”>age in place</a>, or put down a downpayment in efforts to downsize, these savings can be indispensable. Lastly, retirement should be your great next act in the grand play of life–having financial resources allows you to enjoy retirement to the fullest and pursue activities that bring fulfillment and joy.

<h2>How Unison Can Help You Build Wealth</h2>

One of the most popular ways to tap into your home equity to accomplish any of the above objectives has long been to utilize a home equity financing debt product, such as a home equity line of credit. These traditional options did enable homeowners to harvest their equity, but they were accompanied by punishingly high interest rates, and steep monthly payments that often left the borrower with no financial flexibility. Enter Unison.<br><br>

Unison pioneered the <a href=”https://www.unison.com/home-loan/”>Equity Sharing Home Loan</a>, a 10-year, shared appreciation, interest-only home loan with below-market rates for second mortgages*.  Homeowners are empowered to access their equity with low monthly payments, thanks to both the loan’s partially deferred interest, as well as Unison’s share in their home’s future appreciation. 
<br><br>

If you’re interested in making your home equity work for you, but also want to maintain flexibility in your monthly spending, <a href=”https://www.unison.com/home-loan/”>learn more</a> about the Equity Sharing Home Loan today.<br><br><br>

*Based on an internal analysis and review through July 2024 of interest rates for second-lien home equity loans.<br><br><br><br><br><br> 

<i>The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</i>


Apply now for a Unison Equity Sharing Home Loan and experience the benefits of homeownership without the financial burden.

Couple looking at finances to figure out how to build wealth

How to Use Home Equity to Build Wealth

Tapping into your home equity is one of the best ways to build wealth passively. Learn how to use home equity to make money with little additional effort.

How to Use Home Equity to Build Wealth | Unison 

picture of couple looking at documents and thinking of ways to consolidate debt

Ways to Consolidate Debt

If you have multiple high-interest debts, you might be looking for a way to combine them into a single monthly payment. Learn about nine ways you can consolidate debt in this blog post, including a HELOC or Equity Sharing Home Loan.

9 Ways to Consolidate Debt | Unison

<i>by Lauren Rosales-Shepard, Content Writer</i><br><br><br><br>

At <a href=”https://unison.com/”>Unison</a>, we’re fond of saying that we “pioneered” the equity sharing agreement, an innovative product that took note of conundrums faced by both homeowners and investors. Since then, we have paid close attention to the evolving needs and desires of homeowners, as well as the shifting state of the market. <br><br>

When it comes to traditional options, like the closed end home equity loan or a <a href=”https://www.unison.com/blog/about-helocs”>home equity line of credit</a> (HELOC), homeowners have been weary of increasingly high interest rates. And those who were lucky enough lock down favorable first mortgage rates on their homes have naturally been averse to <a href=”https://www.unison.com/blog/cash-out-refinance-pros-and-cons/”>refinancing</a>, or moving into a new house, when the current rates are so much higher. No one actively wants to <i>increase</i> their monthly payments! Unison began to look at ways to help reduce monthly obligations and shorten the loan term. The result? Let us introduce you to the Unison Equity Sharing Home Loan!<br><br>

<h2>What is a Unison Equity Sharing Home Loan?</h2>

You’ve heard of the <a href=”https://unison.com/blog/equity-sharing-agreements”>equity sharing agreement</a>, and your’re familiar with <a href=”https://www.unison.com/blog/pros-cons-home-equity-loan/”>home equity loans</a>. The Equity Sharing Home Loan unites aspects of both products to suit the needs of consumers in this market. <br><br>

Our Equity Sharing Home Loan is an interest-only, ten-year second mortgage that offers homeowners the opportunity to tap into their equity with low monthly payments. The interest rates are below-market for second mortgages, and the interest only payments are partially-deferred, leading to more flexibility for homeowners when it comes to managing their monthly finances. The  shared appreciation component enables us to offer these lower rates. At the end of the loan, the homeowner pays back the principal, any deferred compounded interest, as well as a percentage of the home’s appreciation. <br><br>

Let’s unpack each of these factors. To begin with, an individual’s interest rate is largely determined by their creditworthiness. Unison’s share in the home's future appreciation is fixed at the beginning of the origination process, and the amount  is proportional to the amount of the Equity Sharing Home Loan. Unison's share is typically 1.5x the percentage borrowed. For example, if you borrow 10% of your home’s current value, Unison will receive 15% of the future appreciation. An important distinction is that unlike Unison’s Equity Sharing Agreement, Unison does not share in any depreciation in the home’s value.<br><br>

<h2>What are the benefits of a Unison Equity Sharing Home Loan?</h2>

<ul>
<li><b>Below-Market Interest Rates for Second Mortgages*:
</b> You only pay up to 75 percent of your loan’s monthly payments every month and defer the remaining 25 percent of the interest payments to the end of the loan.
<li><b>Low Monthly Payments:</b> The partially-deferred interest, plus the equity sharing component, keeps monthly payments low.
<li><b>Reach Your Financial Goals:</b> When you save money on your monthly obligations, these savings can go elsewhere to further your financial goals.
<li><b>Flexible Terms:</b> There is no prepayment penalty if you decide to pay off sooner.
<li><b>Hold on to Your Equity:</b> We share in a portion of the future appreciation of your home, not the equity you’ve already built.
</ul>
<font size="-1">*Based on an internal analysis and review through July 2024 of interest rates for second-lien home equity loans.</font>
<br><br>

<h2>How does the Unison Equity Sharing Home Loan compare to other home equity financing options?</h2>

<b><h3>Home Equity Loan vs Equity Sharing Home Loan</h3></b>
<br><br>
Perhaps the first obvious comparison to make is between the traditional home equity loan and Unison’s Equity Sharing Home Loan. A “closed-end” home equity loan offers the homeowner the loan as an upfront lump sum, and the homeowner pays back a portion of the principal, plus interest at a fixed rate, each month for a set term–often 15 years. <br><br>

Unison’s Equity Sharing Home Loan also starts with an upfront lump sum. However, the monthly payment is interest only, with a portion that is deferred. Then, at the end of the loan term (10 years–or, prepay before without penalty!), the homeowner will pay back the principal, any compounded deferred interest, and a percentage of the home’s appreciation in value. <br><br>

Because monthly payments to Unison are interest-only–and that interest is partially-deferred, too!-- they are extremely low. This is especially the case when compared to other traditional forms of home equity financing, which require full interest, and  a percentage of the principal amount every month (though this is not the case with HELOCs, as you will read below). <br><br>

<b><h3>Home Equity Line of Credit (HELOC) vs Equity Sharing Home Loan</h3></b>
<br><br>

A <a href=”https://www.unison.com/blog/how-does-a-heloc-work/”>HELOC</a> is a line of credit that has a draw period and a repayment period. During the draw period, the homeowner is able to withdraw up to a specific amount of Funds. They often only need to pay interest on the amount that they have used each month, rather than interest on the entire amount available. (That said, even if you don’t withdraw any cash, there is often a small maintenance fee imposed). Then, during the repayment period–you guessed it, the homeowner repays the amount, with interest. It’s also important to note that HELOCs tend to have variable interest rates, which means that the interest can change based on market conditions.<br><br>

In contrast, Unison’s Equity Sharing Home Loan has fixed interest rates, and the homeowner only pays a partial percentage of that interest on the loan each month–the rest is compounded, and deferred to the end of the loan. With a Unison Equity Sharing Home Loan, the homeowner will never experience uncertainty regarding their interest rate during the loan term. Plus, the partially-deferred nature of the interest keeps monthly payments low. <br><br>

<b><h3>Reverse Mortgage vs Equity Sharing Home Loan</h3></b>
<br><br>
A <a href=”https://www.unison.com/blog/reverse-mortgage-payments-costs/”>reverse mortgage</a>, as the name implies, differs from a regular mortgage in that the lender makes payments to the homeowner rather than the other way around–either in a lump sum, monthly installments, or as a line of credit. The loan becomes due when the homeowner permanently moves out of the home, sells the home, or passes away. At that time, the loan amount plus accrued interest and fees must be repaid, which is usually done through the sale of the home, with any remaining equity belonging to the homeowner or their heirs. One of their defining features is that reverse mortgages are only available to homeowners age 62 or older. <br><br>

Unison’s Equity Sharing Home Loan does not have an age restriction. And while the reverse mortgage defers the entirety of accrued interest to the end of the loan, the Equity Sharing Home Loan does have monthly interest-only payments, with a percentage deferred to the end of the term. Additionally, while a reverse mortgage requires that the homeowner either own their home outright, or use part of the funds to pay off the remainder of the first mortgage, an Equity Sharing Home Loan is a second mortgage, which is not the primary lien on the property.<br><br>

<b><h3>Cash-Out Refinance vs Equity Sharing Home Loan</h3></b>
<br><br>
A cash-out refinance is the process of a type of mortgage refinancing where you borrow more than your current mortgage balance and receive the difference in cash. While the primary objective is, as the name implies, to get “cash out,” homeowners often also try to take advantage of more favorable interest rates at the same time, ensuring that they will have lower monthly payments even as they extend the amount of time they will be repaying the mortgage. Like with the original first mortgage, homeowners make monthly payments made up of interest and a percentage of the principal. <br><br>

The Equity Sharing Home Loan is a second mortgage, and not a replacement mortgage for the underlying first mortgage. As such, it has a much shorter term–ten years. Plus, the monthly payment does not include a portion of the principal loan amount, as it, along with any compounded, deferred interest, and a percentage of the home’s appreciation, is repaid at the term’s end.<br><br>

Unison developed the Equity Sharing Home Loan as an innovative option for homeowners who want to access the equity in their homes without moving and without exceedingly high monthly payments. Does this describe you? You can <a href=”https://www.unison.com/home-loan/”>learn more</a> today!
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family standing outside of home looking at something

Introducing the Unison Equity Sharing Home Loan

Want to tap into your equity? Learn more about Unison's Equity Sharing Home Loan, and see how it compares to traditional forms of lending like HELOCs and reverse mortgages.

Introducing the Unison Equity Sharing Home Loan | Unison Equity Sharing

Homeowners preparing for retirement could be sitting on a sizable, untapped financial asset—your <a href=”https://www.unison.com/blog/what-is-home-equity-and-how-to-use-it/”>home equity</a>. If you've been paying off your mortgage for a while, chances are you could be using that home equity for your retirement income. Before tapping into home equity, though, it's crucial to understand if pulling equity from your home when you're retired is the right option for you and, if so, the best ways to use it.<br><br>

<ul>
<li><a href=”#WaystoUse”>Ways to Use Home Equity in Retirement</a>
<li><a href=”#ShouldYouUse”>Should You Use Home Equity in Retirement?</a>
<li><a href=”#Unison”>Using Unison’s Equity Sharing Agreement or Equity Sharing Home Loan as Extra Income for Seniors</a>
</ul>
<br><br>

<a id=”#WaystoUse”><h2>Ways to use Home Equity in Retirement</h2></a>

While home equity does not count as retirement savings, you can leverage it as extra cash flow if you need additional income. Learn about the different options for tapping into home equity while retired below.<br><br>

<h3><b>Cash-Out Refinance</b></h3><br><br>

A <a href=”https://www.unison.com/blog/cash-out-refinance-pros-and-cons/”>cash-out refinance</a>—like typical mortgage refinancing—involves a new interest rate and mortgage term. However, with a cash-out refinance, your new loan is larger than your mortgage balance, so you get to pocket the difference. You can secure a cash-out refinance by applying for a new mortgage with a higher loan amount, then paying off the rest of your current mortgage with the new one. The amount that remains can be put toward your retirement goals.<br><br>

Cash-out refinancing is a great option if you've been paying off your mortgage for years and can afford a higher monthly payment and if current interest rates are lower than the ones you're currently paying. If interest rates are higher or if you don't want to add more debt, temporarily lose home equity, or worry that you can't afford a larger monthly payment, you're probably better off skipping a cash-out refinance.<br><br>

<h3><b>Downsizing</b></h3><br><br>

If you're an empty-nester with more space at home than you can or want to take care of, you might consider <a href=”https://www.unison.com/blog/downsizing-vs-aging-in-place/”>downsizing rather than aging-in-place</a>. This involves selling your current home and moving to a smaller home, apartment, or senior living community. You can put the profits from your home sale toward your more immediate financial needs in retirement.<br><br>

While downsizing often lightens your monthly payments, it's possible that you could run into inflation, which would lessen the amount of money you gain from your home sale. In addition, housing shortages and higher costs of living could make it difficult to find a new living community you can afford. If you're considering downsizing, talk to a financial planner before moving forward with a sale to evaluate the state of the housing market and determine if this option would financially benefit you.<br><br>

<h3><b>Equity Sharing Agreement</b></h3><br><br>

Home equity sharing agreements are another way to use home equity during retirement without taking on an additional loan. In this process, you'll make an agreement with a third party, such as an investor, and they'll give you cash based on the current value of your home. In exchange, you'll share a portion of your home's future change in value with them. At the end of a given term or when you decide to sell your home, you'll pay the agreed upon amount.<br><br>

This is perfect for retirees who don't want to worry about adding another monthly payment to their budget. However, an equity sharing agreement might cost more than a loan, especially if your home appreciates significantly over the term. Learn how <a href=”#UnisonESA”>Unison's equity sharing agreement works for retirees</a>.<br><br>

<h3><b>Home Equity Line of Credit (HELOC)</b></h3><br><br>

A <a href=”https://www.unison.com/blog/about-helocs/”>home equity line of credit</a> is a flexible, revolving line of credit that <a href=”https://www.unison.com/blog/how-does-a-heloc-work/”>uses your home as collateral</a>. One <a href=”https://www.unison.com/blog/pros-cons-heloc/”>advantage of a HELOC</a> is that you'll have more control over how much money you take out at a single time, since your money is available on an as-needed basis—and these funds can be used for anything you may need during retirement. The <a href=”https://www.unison.com/blog/home-equity-loan-heloc-application-approval-process/”>process of securing a HELOC</a> starts with applying through a lender, who will ultimately decide on a credit limit based on the equity you've built in your home.<br><br>

It's possible that interest rates could increase over the life of the HELOC because the rates are variable. and if your home value decreases, there's a potential for negative home equity. For retirees that don't have a steady stream of income, adjusting monthly payments could be too difficult. Because your home functions as collateral, failing to meet payment requirements could put your home at risk of foreclosure.<br><br>

<h3><b>Home Equity Loan</b></h3><br><br>

Home equity loans offer a lump sum of cash to be paid back over time (with interest). Home equity loans, also called <a href=”https://unison.com/blog/what-is-second-mortgage”>closed end second mortgages</a>, are taken out in addition to your first mortgage using your home as collateral. In order to secure a home equity loan, you'll start by getting your home equity appraised by a lender.<br><br>

Home equity loans for seniors are a great way to access the home equity you've built up over the years. A major <a href=”https://www.unison.com/blog/pros-cons-home-equity-loan/”>plus of home equity loans</a> is their fixed interest rate that's usually lower than other loan types. If you need to pay for a large one-time payment without drastically altering your monthly budget, this could be the right choice for you. However, the process involves taking on an additional monthly payment and more debt, which could be a financial burden in the long run. You'll also risk foreclosure on your home if you can't make payments on time.<br><br>

<h3><b>Reverse Mortgage</b></h3><br><br>

Retirees that want an option for using home equity that's tailored specifically to their age group may want to consider a <a href=”https://www.unison.com/blog/reverse-mortgage-payments-costs/”>reverse mortgage</a>. This senior equity loan is only open to homeowners ages 62 and older who own significant home equity. With a reverse mortgage, a lender converts your home equity into cash and pays it out to you in monthly installments, as opposed to you paying the lender (as with a traditional mortgage). After your home is appraised, you'll receive a disbursed amount of money based on your home equity, which is then repaid when you sell your home or pass away.<br><br>

Not only does a reverse mortgage give you additional cash flow, but it allows you to continue living in and maintaining ownership of your current property. It's important to remember, though, that your home equity may decrease as you accrue interest, and you could still lose your home to foreclosure should you default on your reverse mortgage.<br><br>

<a id=”#ShouldYouUse”><h2>Should You Use Home Equity in Retirement?</h2></a>

Whether you should or should not use home equity in retirement is heavily dependent on your financial situation and available budget. It's best to consult a financial advisor and assess your current situation before deciding to tap into your home equity, but here are a few guidelines to get you started.
<br><br>

<h3><b>When Tapping into Home Equity Is a Good Idea</b></h3><br><br>

<ul>
<li>You're <a href=”https://www.unison.com/blog/home_improvement_renovation_home_equity/”>funding home improvements</a>
<li>You're fielding unexpected emergency expenses
<li>You're <a href=”https://www.unison.com/blog/tips/debt_management/”>paying off high-interest debt</a>
<li>You're covering college tuition costs for children or grandchildren
</ul>
<br><br>

<h3><b>When Tapping into Home Equity Is a Bad Idea</b></h3><br><br>

<ul>
<li>You have a limited budget or significant debt
<li>You don't have a specific purpose in mind for the money
<li>You're planning to sell your home in the near future
<li>You wish to leave your home to family in your will
</ul><br><br>

<a id=”#UnisonESA”><h2>Using Unison’s Equity Sharing Agreement or Equity Sharing Home Loan as Extra Income for Seniors</h2></a>

Unison's <a href=”https://www.unison.com/blog/equity-sharing-agreements/”>equity sharing agreement</a> helps retirees tap into their home's equity <a href=”https://www.unison.com/blog/how-to-access-home-equity-without-debt/”>without the burden of added debt</a>, interest, or monthly payments.<br><br>

We provide seniors with a straightforward, stress-free process. You'll receive up to 15% of your home’s current value in cash, in exchange for a percentage of your home’s change in value over time. You can use that cash for any financial assistance you need during retirement. During the <a href=”https://www.unison.com/blog/process-agreement-duration/”>30-year term</a>, you can choose to <a href=”https://www.unison.com/blog/process-termination/”>buy Unison out</a> or settle the agreement upon the sale of your home. Should your home value increase, Unison will share in the profits. If your home value should decrease, we'll typically share in the loss.<br><br>

<b><h3>Unison’s Equity Sharing Home Loan–an Innovative New Offering</h3></b><br><br>

The Equity Sharing Home Loan combines features of a traditional home equity loan with aspects of Unison’s pioneering equity sharing agreement. It is a mortgage with a ten-year term that allows borrowers to access the equity in their home at a low, below-market interest rate for second mortgages, which is moderately offset by a percentage of future appreciation of the house's value. This loan also features interest-only payments, with partially-deferred interest, leading to a lower monthly obligation for the homeowner.

<br><br>
Either a) after ten years, b) when you sell your home, or c) if you choose to prepay, the net appreciation (if any) will be determined. The loan is negative amortizing, so you will owe the principal amount borrowed, the agreed-upon percentage of the home’s appreciation, as well as any deferred interest. Note that unlike Unison’s equity sharing agreement, Unison does not share in any depreciation in your home’s value.<br><br>

If you’d like to learn more about Unison’s offerings, and see whether tapping into your equity with either the equity sharing agreement or the equity sharing home loan might be a good fit for you,  <a href=”https://unison.com”>learn more</a> today. 
<br><br>
*Based on an internal analysis and review through July 2024 of interest rates for second-lien home equity loans.
<br><br><br>

<i>The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</i>


Couple sharing ideas about how to use home equity in retirement.

Couple sharing ideas

There are a few ways to access your home equity–this article describes home equity loans, HELOCs, among others, including Unison's Equity Sharing Home Loan.

How to Use Home Equity in Retirement | Unison Home Equity Sharing

Tapping into your home equity is a great way to access funds for immediate financial needs. While selling your home is one way to achieve this goal, there are many other solutions that allow you to take equity out of your home without having to move. Learn about these six alternative ways to get equity out of your home.<br><br>

<ul>
<li><a href="#CashOutReFi">Cash-Out Refinance</a>
<li><a href="#HELOC">Home Equity Line of Credit</a>
<li><a href="#HomeEquityLoan">Home Equity Loan</a>
<li><a href="#HomeSaleLeaseBack">Home Sale Leaseback</a>
<li><a href="#ReverseMort">Reverse Mortgage</a>
<li><a href="#EquityAgreement">Home Equity Sharing Agreement</a>
<li><a href="EquitySharingHomeLoan">Unison’s Equity Sharing Home Loan</a>

</ul><br><br>

<div id="#CashOutReFi"><h2>Cash-Out Refinance</h2></div>

With cash-out refinancing, a homeowner replaces their current mortgage with a newer, larger loan. This <a href="https://www.unison.com/blog/refinancing_tips/">refinancing strategy</a> results in access to a lump sum of cash reflecting the difference between your new loan amount and the existing mortgage balance.<br><br>

<h3><b>How Does a Cash-Out Refinance Work?</b></h3><br><br>

In the <a href="https://www.unison.com/blog/how-long-to-get-cash-out-refinance/">cash-out refinance process</a>, you'll first need your property appraised for its current market value. Then, you'll submit an application for a new mortgage loan, which indicates the amount you want to borrow on top of your current balance. Upon approval, you'll receive a new mortgage balance that includes both of these amounts. Then, after paying off your existing mortgage with the funds received, you can apply the remainder towards immediate financial demands. <br><br>

To receive approval for a cash-out refinance, you must typically have at least 20% equity in your home, a good credit score, and proof of reliable income. <a href="https://www.unison.com/blog/cash-out-refinance-vs-home-equity-loan/">Similar to a home equity loan</a>, a cash-out refi involves fixed monthly payments that begin immediately.<br><br>

<h3><b>Pros of Cash-Out ReFi</b></h3><br><br>

Before choosing this option to unlock home equity, take into account the following <a href="https://www.unison.com/blog/cash-out-refinance-pros-and-cons/">cash-out refinance pros and cons</a>.<br><br>

<ul>
<li><b>Upfront Cash:</b> Cash-out refinancing offers you a lump sum of money that can be used for mortgage payments and other expenses in relatively no time.
<li><b>Lower Interest Rates:</b> Mortgage interest rates are usually lower than other forms of borrowing. Plus, if current mortgage interest rates are lower than the rate you're paying for your existing mortgage, you could have smaller monthly payments. 
<li><b>Tax Deductions:</b> You may be eligible for tax deductions on the interest you pay on your cash-out refinance.
<li><b>Flexible Terms:</b> Cash-out refis typically involve fixed, predictable repayments, while also offering flexible terms featuring longer repayment periods, variable interest rates, and more.
</ul><br><br>

<b><h3>Cons of Cash-Out ReFi</h3></b><br><br>
<ul>
<li><b>Increased Debt:</b> With a higher loan amount and potentially higher monthly payments, you may see an increase in mortgage debt.
<li><b>Equity Reduction:</b> Cash-out refinancing erases the amount of equity you've built in your home and limits your ability to access funds in the future.
<li><b>Closing Costs:</b> Application costs, appraisal fees, and other closing costs add up when cash-out refinancing.
<li><b>Risk of Foreclosure:</b> Failure to pay your new mortgage payments could put your home at risk of foreclosure.
</ul><br><br>

<a id="#HELOC"><h2>Home Equity Line of Credit</h2></a>

A <a href="https://www.unison.com/blog/about-helocs/">home equity line of credit</a>, also known as a HELOC, is a borrowing option that allows you to access cash using your home equity as collateral.<br><br>

<h3><b>How Does a Home Equity Line of Credit (HELOC) Work?</b></h3><br><br>

HELOCs function similarly to a traditional credit card, with your home acting as the credit line.<br><br>

To begin the <a href="https://www.unison.com/blog/how-does-a-heloc-work/">HELOC mortgage process</a>, a lender will need to assess three factors: your current financial standing, the amount of home equity you have, and your home's current market value. After you're approved for a home equity line of credit and a credit limit is determined based on your home's equity, you can use the funds at any time for any amount (up to the limit). <br><br>
In order to get approved for a HELOC, you must be at least 18 years old, have a stable stream of income and good credit score, and own around 15% to 20% equity in your home. Once your HELOC's funds are depleted, you'll enter the repayment period, which typically involves monthly payments on the principal and accrued interest.<br><br>

<h3><b>Pros of Home Equity Line of Credit</b></h3><br><br>

As with other equity alternatives, there are several <a href="https://www.unison.com/blog/pros-cons-heloc/">advantages and disadvantages of home equity lines of credit</a> to consider before borrowing.
<ul>
<li><b>Lower Interest Rates:</b> You can usually expect to see lower interest rates on <a href="https://www.unison.com/blog/best-fit-for-HELOC-and-alternatives/">HELOCs compared to traditional home equity loans.</a>
<li><b>Flexible Use:</b> Borrowers can use HELOC funds for a wide variety of purposes and are given flexibility in how and when they can access cash.
<li><b>Long Draw Period:</b> Should your home's value increase during the life of the HELOC, your equity and borrowing capacity may also grow, providing additional access to funds.
<li><b>Tax Benefits:</b> If funds are used on relevant payments, such as home improvements, a HELOC's interest may be eligible for tax deductions. 
</ul><br><br>

<h3><b>Cons of Home Equity Line of Credit</b></h3><br><br>
<ul>
<li><b>Variable Interest Rates:</b> Over the course of a HELOC, there is a potential for interest rates to change and result in higher monthly payments.
<li><b>Temptation to Overspend:</b> Entering a HELOC requires disciplined spending to accumulate less debt than you can afford to repay.
<li><b>Lower Home Equity:</b> It's possible that you could owe more on your HELOC than what your home is worth if your home value decreases.
<li><b>Risk of Foreclosure:</b> Since a HELOC uses your home as collateral, missing required payments puts your property at risk of foreclosure.
</ul>
<br><br>

<a id="#HomeEquityLoan"><h2>Home Equity Loan</h2></a>

Home equity loans, or second mortgages, are fixed-term loans that allow homeowners to borrow against their property's equity.<br><br>

<h3><b>How Does a Home Equity Loan Work?</b></h3><br><br>

Acquiring a home equity loan requires a lender to assess your financial standing and the amount of home equity you have. If you're approved, you'll be given an upfront lump sum based on these factors, which can be used to cover important expenses. <br><br>

Home equity loans <a href="https://www.unison.com/blog/reverse-mortgage-vs-home-equity-loan/">vary from reverse mortgages</a>, for example, which do not involve regular monthly payments. In a second mortgage, you must begin paying it back immediately. While home equity repayment periods differ by lender, this typically occurs over the course of five to 30 years. Meeting home equity loan requirements usually means having at least 15% to 20% equity in your home, a strong credit score, a stable source of income, and a low debt-to-income ratio.<br><br>

<h3><b>Pros of Home Equity Loans</b></h3><br><br>

There are many <a href="https://guide.unison.com/blog/pros-cons-home-equity-loan/">pros and cons of home equity loans</a> to be aware of, including:
<ul>
<li><b>Access to Cash:</b>  A single lump sum payment is perfect if you're looking to pay off major expenses quickly. 
<li><b>Stable Interest Rates:</b> Home equity loans function at fixed rates and involve consistent monthly payments, regardless of market conditions.
<li><b>Extendable Repayment Period:</b> It's possible for the loan's repayment period to be extended up to 30 years, making monthly payments more manageable.
<li><b>No Age Requirement:</b> Most lenders do not have a minimum age requirement for home equity loan eligibility.
</ul><br><br>

<h3><b>Cons of Home Equity Loans</b></h3><br><br>
<ul>
<li><b>Decreased Home Equity:</b> If the real estate market drops, your home value could drop, too, and leave you with a loan balance exceeding your property's value.
<li><b>Risk of Foreclosure:</b> Because this loan is secured by your home, you could be at risk of losing your property if you fail to meet your monthly payments. 
<li><b>Additional Costs:</b> On top of adding a second monthly mortgage payment, home equity loans come with appraisal fees and closing costs. 
</ul><br><br>

<a id="#HomeSaleLeaseBack"><h2>Home Sale Leaseback</h2></a>

If you'd prefer to <a href="https://www.unison.com/blog/how-to-access-home-equity-without-debt/">access home equity without refinancing or accruing debt</a>, consider a home sale leaseback. This is a real estate transaction in which a homeowner sells their property and becomes a tenant, continuing to live in their home (or elsewhere) while paying rent for the house.<br><br>
<b><h3>How Does a Home Sale Leaseback Work?</b></h3><br><br>

After finding a buyer, the home sale leaseback option works just like selling a home. In this sell and leaseback process, you'll define terms and transfer ownership to the buyer, who will then ask you to sign a lease agreement. Then, you can either begin living in your home as a tenant or lease the property out while living elsewhere, as long as you make regular rental payments to the buyer-turned-owner.<br><br>

<b><h3>Pros of Home Sale Leaseback</b></h3><br><br>

Here are a few sale and leaseback advantages and disadvantages that can help you decide whether this option is right for you.<br><br>
<ul>
<li><b>Quick Access to Funds:</b> Selling your property gives you immediate access to a lump sum that you can use toward other expenses as needed. 
<li><b>Rental Perks:</b> Selling and renting back your house can help eliminate/decrease any existing mortgage debt and allow you to remain unaffected by fluctuations in the real estate market.
<li><b>Negotiable Terms:</b> Because buyers and sellers can negotiate terms independent of traditional lending institutions, leasebacks might be more flexible and help you avoid additional fees.
<li><b>Flexibility to Stay or Move:</b> Entering a home sale leaseback gives you the flexibility to remain in your current home or relocate as you wish. 
</ul><br><br>

<b><h3>Cons of Home Sale Leaseback</h3></b><br><br>
<ul>
<li><b>Loss of Ownership:</b> Once you give up ownership of your home, you can no longer benefit from property appreciation, build home equity, or make property-related decisions. 
<li><b>Total Loss of Equity:</b> To reiterate, selling your home in this manner means that you lose all of your equity.
<li><b>Risk of Eviction:</b> Failure to make lease payments or other violations to the contract could result in eviction. 
<li><b>Rental Payments:</b> Home sale leasebacks result in regular rental payments, which could increase based on market fluctuations depending on the terms. 
<li><b>Tax Liabilities:</b> You may be responsible for potential tax liabilities on the capital gains associated with the sale of your property. 
</ul>
<br><br>

<a id="#ReverseMort"><h2>Reverse Mortgage</h2></a>

<a href="https://www.unison.com/blog/reverse-mortgage-payments-costs/">Reverse mortgage loans</a> are unique alternatives to home loans. They allow homeowners over the age of 62 to convert a portion of their home's equity into cash. Unlike traditional mortgages, where homeowners make monthly payments to a lender, reverse mortgages require lenders to make regular payments to the borrower.<br><br>

<b><h3>How Does a Reverse Mortgage Work?</h3></b><br><br>

To get a reverse mortgage, you must first submit your application and home appraisal. Once you are approved, you'll be given an estimate determined by the amount of equity you've built in your home. Rather than making regular payments to the lender, these payments will be disbursed to you to use as you please. You (or your loved ones) must repay these funds when you sell your home or pass away. To be eligible for a reverse mortgage, you must be at least 62 years old and have a significant amount of home equity. <br><br>

<h3><b>Pros of Reverse Mortgages</b></h3><br><br>

Below are the primary <a href="https://www.unison.com/blog/reverse-mortgage-pros-and-cons/">advantages and disadvantages of reverse mortgages.</a><br><br>
<ul>
<li><b>Increased Cash Flow:</b> Payments from a reverse mortgage can help supplement your income or provide you with a financial safety net.
<li><b>Flexible Payment Options:</b> Reverse mortgage funds can be distributed to you via a lump sum payment, line of credit, regular monthly payments, or a mix of these options. 
<li><b>Continue Living in Your Home:</b> One of the major benefits of a reverse mortgage is that you can continue to maintain ownership of (and live in) your home. 
<li><b>Safe From Market Fluctuations:</b> Reverse mortgages are considered non-recourse loans, meaning you won't be personally liable for any loan amount that exceeds your home's value.
</ul>
<br><br>

<h3><b>Cons of Reverse Mortgages</b></h3><br><br>

<ul>
<li><b>Additional Costs:</b> Depending on the lender and terms, reverse mortgages can incur additional costs, including administrative fees, closing costs, monthly servicing fees, and more.
<li><b>Accumulating Interest:</b> A reverse mortgage accumulates interest over time, which may decrease the amount of home equity you own and negatively impact your heirs until the loan is repaid.
<li><b>Impact on Government Benefits:</b> Receiving a reverse mortgage may make you ineligible for government benefits, such as supplemental security income (SSI) and Medicaid.
<li><b>Risk of Foreclosure:</b> Falling behind on maintenance fees, property taxes, or other homeowner payments could put you at risk of losing your home.
</ul>
<br><br>

<a id="#EquityAgreement"><h2>Home Equity Sharing Agreement</h2></a>

A Home Equity Sharing Agreement (HESA), Shared Equity Agreement, or Home Equity Investment, is a way for homeowners to access a portion of their home equity without taking on additional monthly payments or selling their property. <br><br>

<b><h3>How Do Home Equity Sharing Agreements Work?</h3></b><br><br>

The process and terms will vary by provider, but generally a home equity sharing agreement works by homeowners first receiving a lump sum of cash in exchange for a percentage (typically between 15-50%) of the appreciation of their home in the future. Unlike a traditional loan, you don't have to make any monthly payments and simply pay when you sell your property or the agreement ends.<br><br>

<h3><b>Pros of Home Equity Sharing Agreements</b></h3><br><br>

Below are the following pros and cons of a home equity sharing agreement. 
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<li><b>Access to Funds:</b> You can get a large sum of money without taking on additional debt.
<li><b>No Monthly Payments:</b> You don't have to worry about making monthly payments.
<li><b>Home Appreciation:</b> You can share in the profits if your home value increases.
<li><b>Flexible Terms:</b> Homeowners can choose the term of the agreement and the percentage of appreciation to share.
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<h3><b>Cons of Home Equity Agreements</b></h3><br><br>
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<li><b>Loss of Equity:</b> You will be giving up a portion of the potential change in value  of your home to the investment company.
<li><b>Not One-Size-Fits-All:</b> Equity sharing agreements are unique, just like the homeowners they serve. As such, they are not the right fit for everyone. It’s important to make sure you understand the agreement and how it may impact you.
<li><b>Refinancing:</b> Some mortgage lenders may decline to provide new loans to you because you have subordinate financing that shares in equity or home appreciation.
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With Unison's <a href="https://www.unison.com/blog/equity-sharing-agreements/">equity sharing agreement</a>, we convert up to 15% of your home's value to cash, so you can <a href="https://www.unison.com/blog/process-funding/">put those funds to work</a> for you and continue to own your home. Like other home equity agreements, Unison features no monthly payments or added interest. But the best part is that we often share in your loss should your home decrease in value. And we make it easier than ever to <a href="https://www.unison.com/blog/process-termination/">end your agreement</a> or sell your home if your circumstances suddenly change.<br><br>

<a id="#EquitySharingHomeLoan"><h2>Unison’s Equity Sharing Home Loan</h2></a>

Unison’s equity sharing home loan is an innovative product that combines some of the best features of the home equity sharing agreement with the familiar idea of a home equity loan, or second mortgage. 
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<b><h3>How Does Unison’s Equity Sharing Home Loan Work?</h3></b><br><br>

The equity sharing home loan is a 10-year, shared appreciation, interest-only home loan with below-market rates for second mortgages*. You get to enjoy lower monthly payments thanks to both the loan’s partially deferred interest, as well as Unison’s share in your home’s future appreciation. <br><br>

<h3><b>Pros of Unison Equity Sharing Home Loan</b></h3><br><br>

<li><b>Low Monthly Payments</b>: The shared appreciation component, as well as the partially deferred interest, keep your monthly obligation low and increase your cash flow and spending power.
<li><b>No Prepayment Penalty</b>: You can repay your loan early without penalty, which includes paying back the original amount, any deferred interest, and the share of any appreciation.
<li><b>Capital Improvement Adjustment</b>: Unison believes that if you make improvements to your home that boost its value (beyond regular maintenance), you should get all the benefits!  The homeowner may apply to keep any value added by renovations, after three years. 
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<h3><b>Cons of Unison Equity Sharing Home Loan</b></h3><br><br>

<li><b>Eligibility </b>: Homeowners must have a minimum FICO score of 680, a maximum combined loan to value ratio of 70%, and a debt-to-income ratio not exceeding 40%.
<li><b>Potential Share Appreciation Interest</b>: If there is excessive home price appreciation, this can add to the total cost. However, Unison’s equity sharing home loan also includes a 17% annualized return cap which may limit the impact of the shared appreciation term.<br><br>

  <a href="https://www.unison.com/home-loan/">Learn more</a> about Unison’s Equity Sharing Home Loan today, and see whether it might be a good fit for you.

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*Based on an internal analysis and review through July 2024 of interest rates for second-lien home equity loans.
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<i>The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</i>


Happy couple sitting on porch of home they have equity in.

Alternative Ways to Get Equity Out of Your Home

You don't have to sell your home to harvest your equity. Learn more about the alternative ways to tap into your equity, from HELOCs to Unison's Equity Sharing Home Loan, among others.

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