California couple taps home equity to fund home repairs

How Paul Funded Home Repairs to Prepare for Retirement

For Paul and his wife, retirement isn’t too far down the road, so they’re thinking strategically about their financial plans. They anticipate moving within the next 10 years, but until then, they have some home repairs and updates they want to make now — before they’re on a fixed income.

“We wanted to stay here for a while and we wanted to have access to some of that equity that we have quite a bit [of] in the house and we wanted to be able to make some [home] improvements, and help assist our son who’s disabled,” Paul explained.

They knew they’d built enough equity up in their home to fund their goals, but with all of the different financing options available for accessing their equity, their work was cut out for them.

“We looked at the reverse mortgage options […] we looked at a home equity line of credit; we looked at quite a few different options and went through quite a process of number crunching. But for our situation, in our home, for how much equity we have, how little we owe against a low interest mortgage payment […] when we crunched the numbers, Hometap just came out making so much more sense.”

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For Paul and his wife, it was the structure of the Investment, the terms, and his Investment Manager that made their decision.

“I really like the design of this product,” Paul said. “I love to pay that fair percentage when the home sells, and that’s a pretty cool thing. It’s not like a compounding interest, like a reverse mortgage. And down the road, somewhere in that 5-to-7-to-10 year range, we will sell the home and we’re going to downsize and Hometap is going to get their share of the Investment and we are going to be 7, 10 years down the road in much better shape.”

As Paul describes it, there were many complexities that they needed to factor into the equation before making their decision. That’s where their dedicated Investment Manager was most valuable.

“This young man was incredible. He was helpful, informative, never pushy, never pressing us,” said Paul. “I kind of drug [sic] him through the wringer because I had complex situations to figure out our financial future that included complexities of a severance package, complexities of our Social Security income that we’ll be drawing, complexities of our IRA that we will be opening and accessing and how to blend those things to create the financial future over the next decade that we’re hoping to do. So he was super patient with all that.”

After completing their Application and receiving an Investment Estimate, Paul and his Investment Manager scheduled a home appraisal and the signing. Paul and his wife received their funds and set out to accomplish the renovations they’d been planning.

“I have a great amount of peace about our financial future now, about the way we have designed it for my wife and I and for my kids, my family. I’m just really very, very happy that I found this.”

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*Disclaimer: This homeowner was compensated for providing Hometap with an interview about his Investment experience.

Donna used her home equity to fund aging in place renovations

Donna used her home equity to fund aging in place renovations

Donna knew she had a significant amount of equity in her home in Hopkins, Minnesota. She’d lived there since it was built in 1986, and the home hadn’t undergone any updates in that time. She had no intention of moving any time soon, so when her partner began experiencing some mobility issues, she decided it was time for some updates so that it would stay accessible as they age in place together in their home.

Handrails in the two bathrooms, curbless shower stalls (often referred to as walk-in showers or zero-entry showers), kitchen cupboards that didn’t require lots of low kneeling, and narrower bathroom vanities in case a cane or walker is needed down the line—these were the renovations on Donna’s list that would all make aging in place more enjoyable.

But despite her substantial home equity, Donna’s mortgage company wasn’t interested in offering a line of credit to fund the kitchen and bathroom renovations they had planned. So the self-employed clothing designer started looking for alternative financing solutions.

After hearing a sponsored advertisement on Minnesota Public Radio about Hometap, Donna was intrigued.

“I have a background in security sales so I have familiarity with home equity products, and so first I wanted to see if it was legal in Minnesota,” explains Donna. “It felt like a good fit for me; I made the connection with [my Investment Manager] Sam, she got in touch with me right away, and I was impressed with the level of service I got. I never hesitated, any questions I had were answered thoroughly.”

Her Investment Manager’s expertise and attention, combined with Hometap’s Scenario Planner, helped Donna decide that Hometap was the right solution for her and her home.

“I liked the accounting part of it where [Sam and I] walked through scenarios and plugged in different numbers to come up with estimates,” says Donna. “I’m used to working with probables, so it made it easy for me to compare [a Hometap Investment] to a loan; it was fun and easy to work with, it gave me the right tools as I was thinking through my options. And the FAQ section was very thorough in answering questions I had, too.”

Just two months after accepting a Hometap Investment, Donna is about one-third of the way through with her home improvements, and is putting the final details together on her kitchen upgrades.

Susan W. is now living comfortably in retirement without the burden of debt

How Susan Paid Off Medical Bills and Credit Card Debt with Her Equity

Saddled with thousands of dollars in unexpected medical bills and credit card debt, Susan W. wasn’t having a great start to retirement.

The first thing Susan did each month was pay her mortgage, leaving just enough cash from her fixed retirement income to make the minimum payments on the rest of her bills. Interest was adding up and looming over her head, making it impossible for her to enjoy the retirement she’d worked so hard for.

“I felt like I was marching in place,” Susan recalled.

Susan started comparing her options to tap into her home equity: reverse mortgage, cash-out refinance, and Hometap. She quickly eliminated a cash-out refinance due to high rates and monthly payments that she knew wouldn’t be sustainable in the long term. She was also hesitant about a reverse mortgage since she wanted to leave her home to her children.

“When comparing a reverse mortgage to a refinance to Hometap, Hometap wins for me every time,” Susan said. With Hometap, she didn’t have to sell or sign her home over to a lender. She used her Hometap Investment to pay off her credit card debt and medical bills. The simple, fast, no-surprises process and one main point of contact were also beneficial. Susan felt like her Hometap Investment Manager understood her situation without having to explain it.

With no monthly payment, Susan is now living comfortably in retirement without the burden of debt. “After Hometap, I was finally able to breathe easy,” she said. “I feel like myself and can wake up happy again.

“Taking an investment in my home makes me feel like a pioneer. And I love sharing my story with friends.”