If you currently own a home and are looking for access to funds, Unlock can help. Instead of a traditional home equity loan, Unlock gives you cash today in exchange for a percentage of your home’s future value. By “unlocking” your home’s equity you can borrow between $30,000 to $500,000 and avoid interest fees and monthly payments. Read on to discover if Unlock is the right lender for you.
The best way to understand how Unlock works is through an example. If your home is worth $500,000 and you own 50% of the equity (with your mortgage lender or bank owning the remaining 50%), you could borrow $50,000 from Unlock (10% of your equity) and in exchange, Unlock would then own 16% of your future home equity. So if in 5 years you choose to sell your home at a price of $550,000, Unlock would then receive $88,000 (16%) of the sale price. You could also choose to buy back the equity from Unlock at any time.
So while you won't make any monthly payments, you will have to factor in the cost of the loan when you sell your home.
Applying for an Unlock loan takes about 10 minutes and you’ll need a few personal documents including:
The approval process can take between 10-30 days which is longer than most traditional home equity loans. Once approved, you’ll receive your desired loan amount in exchange for a share of the future value of your home. You can end the agreement at any time either by buying back the equity or selling your home.
Unlock determines the value of your home based on the Total Home Finance, your home's current loan-to-value percentage plus Unlock's share percentage. Their website example uses a home valued at $500,000 with $300,000 in mortgage debt. If the Exchange Rate for a $50,000 Unlock Investment is 1.6x, this would result in a 16% Unlock Percentage (10% x 1.6 = 16%). The loan-to-value is 60% ($300,000 / $500,000) and the Total Home Finance is 76% (60% + 16%).
Unlock remains a silent partner, they won't appear on the title and will have no occupancy or ownership rights. Customers can end the term by buying out Unlock or selling their homes. You’ll just have to pay Unlock according to the original terms. Unlock receives 5% to 43.75% of the home's value at the end of the contract, based on how much cash you receive upfront.
Unlock Office
548 Market St #31036
San Francisco, CA 94104
If you have any questions, you can reach customer support through their website. Support is available by email (hello@unlock.com). You can also schedule a call through the website.
Unlock customer service will help you through the entire application process. Once you submit your initial documents, an agent will schedule a call to go over the agreement terms and estimated costs of the home equity cash-out.