About lender

It is an investment firm that offers proprietors money in exchange for a fraction of their property's future value. This firm calls itself a co-investor - it buys out up to 17.5% of your house's current value and then gives you that money. If the property's price increases, the home equity company earns a profit. If your home loses value, the company has to take that loss alongside you.

The loan is settled by either buying out the fraction they purchased or selling the house and then giving the company a part of the money before the thirty-year term elapses. There's also an option for refinancing. The main difference between this and traditional home equity services or products is that the latter comes with hefty fees and often necessitates a monthly payment.

History and current situation

The company was established a long time ago, in 2004. It took three full years for the founder, Thomas Sponholtz, to figure out what needed to be fixed about the market. The company entered the home ownership investment niche in 2007 and ten years later made the list of "2017 Innovators to Watch" by Bank Innovation. In addition to earning this honor and enjoying financial prosperity for more than a decade, the company also helped many families across America to improve their financial standing and start making large contributions to their retirement funds.

Currently, the company is headquartered in San Francisco, California. The Thomas Sponholtz-helmed juggernaut operates in 30 states, including Utah, Michigan, and Arizona.

Pros and cons

Despite its objective success rate and positive perception, this company also has several cons that need to be discussed. First, however, here are the pros:

1. Lack of monthly payment requirements or interest charges. That's what makes it a better option when compared to more traditional solutions – they charge interest and force you to pay every month.

2. Big payments are available. Unison can give you close to 17.5% of your home's current market price.

3. No limitations on spending. You can use that money however you see fit, even to cover unforeseen expenses or tuck more money into your retirement fund.

4. They share the loss if your house loses in value.

5. You receive the entire amount in cash. Unlike most other real estate companies, this makes sense for cash-strapped individuals.

6. You can renovate your house to boost its value. It's one of the most popular ways of spending money.

7. Pre-approval process doesn't affect your credit score. They conduct a soft pull.

Cons to consider include:

1. You cannot buy their share of your house in the first five years.

2. You can't rent a property. Only owner-occupied houses are eligible, meaning you can't rent a property for an additional income stream.

3. 3rd-party fees are applied in the process. Also, there's a 3% transaction fee.

4. It's not available in every state.

5. Other co-investors have shorter terms. For instance, Hometap offers ten-year terms.

6. There's a cap on the sum you can receive. It's not possible to receive more than $500,000.

7. There's risk adjustment involved. The company adjusts the home's value by 2.5% to compensate for market fluctuations and other risks.

All in all, it's safe to say that this can be a great option for some people, but there are still downsides to take into consideration.

Terms and conditions

You get access to up to 17.5% of your house's current value, but the amount can't be lower than $30,000 and higher than $500,000. There is a 2.5% origination fee, and the fixed term is thirty years.

You will repay four times the original loan (no more than 70% of the increase in value), and there's no prepayment penalty. The key requirements include a minimum credit score of 620 and a maximum LTV (Loan-to-Value) ratio of 75%.

The official Unison website outlines several ways to use the money, including home renovation, debt elimination, start-up investment (with no business loans), big purchases, and savings recovery. Each respective page has a built-in calculator that gives you an estimate. For instance, if your home costs $400,000 and you decide to remodel the kitchen, you will still have $45,000 left in cash. Those are only estimates and should be treated with a healthy dose of skepticism.

Unison’s funding

This company transfers cash to your bank account. Accessing the funds takes 30 to 45 days, but it can take even more time in some circumstances. The funding time is approximately the same for other co-investors as well.