Unlock and an increasing number of other companies like it (such as Unison, Point, HomePace, and Hometap) are part of an emerging business segment in the home-equity space that serves borrowers who may not want or qualify for a traditional home-equity product like a HELOC. Instead, they offer homeowners a product called a shared-equity contract or agreement in which homeowners are provided cash upfront in return for a share of the equity in their homes.
At the end of the contract period (10 years in the case of Unlock) the homeowner must settle the terms of the contract either through a direct payment, refinancing or the sale of the home.
This article originally appeared on HousingWire. Read the full article here.