No one’s talking about a dangerous new US housing trend. Why home equity agreements could trigger disaster for millions

Core Insights - American families have a total of $35.8 trillion in home equity as of mid-2025, but much of this wealth is illiquid and hard to access [1] Group 1: Home Equity Instruments - Home equity lines of credit (HELOC) are popular for accessing home equity, but there is a rising demand for home equity agreements (HEA) or home equity investments (HEI) as an alternative [2] - HEAs provide homeowners with upfront cash in exchange for a portion of their home equity, typically requiring repayment after a fixed term, along with a multiple of the home's value at settlement [3] Group 2: Market Trends - In the first ten months of 2024, 11,000 home equity contracts worth approximately $1.1 billion were signed, with the total market estimated between $2 billion and $3 billion [4] - The Consumer Financial Protection Bureau (CFPB) anticipates continued growth in the HEA market, despite it being smaller than the HELOC market [5] Group 3: Risks and Considerations - The complexity of HEAs may expose homeowners to risks that they may not fully understand, as the terms are often more favorable to the companies issuing these contracts [5]