Unison Launches Innovative Equity Sharing Home Loan to Convert Home Equity Into Cash

Core Insights - Unison has launched the Unison Equity Sharing Home Loan, allowing homeowners to access cash at below-market rates while maintaining their existing low-interest mortgages [1][2][3] - Carlyle has agreed to purchase up to $300 million of these equity sharing home loans, indicating strong institutional interest in this innovative financial product [2][3] - The loan structure combines a fixed below-market interest rate with a share of future home appreciation, providing homeowners with lower monthly payments and financial flexibility [4][5][6] Product Features - The Unison Equity Sharing Home Loan is an interest-only loan, where part of the cost is offset by sharing a portion of the home's future appreciation and partially deferring interest [5] - Eligibility criteria include a minimum FICO score of 680, a maximum combined loan-to-value ratio of 70%, and a debt-to-income ratio not exceeding 40% [5] - Borrowers can repay the loan early without penalty, which includes repaying the original loan amount, any deferred interest, and the agreed-upon share of appreciation [5] Market Context - U.S. homeowners currently hold nearly $32 trillion in home equity, but many are not refinancing their low-interest first mortgages, making their largest asset less accessible [2] - The Unison Equity Sharing Home Loan aims to address this issue by providing a new financing option that offers lower rates and monthly payments compared to traditional equity financing products [6] - Unison's approach allows homeowners to access their equity without the need to sell their homes or incur significant additional debt, promoting financial wellness [7]