Hometap is a debt alternative for homeowners who are house rich and cash poor. Rather than take out a second mortgage, HELOC, or refinance, customers can receive an investment in exchange for a percentage of their house’s equity. Homeowners have to settle the investment at the end of a ten-year term, either through selling their house, buying out the investment, or refinancing their mortgage. Hometap raised $100M in a Series B round in 2019, with investment from ICONIQ Capital, General Catalyst, G20 Ventures, Pillar Ventures, and American Family Ventures.
Since its product is a nascent investment form whose alternative—in the form of debt and loans—has a considerable advantage in its size, age, and recognition, Hometap sees an especial need to be transparent and compliant, often going above federal requirements to establish homeowner trust.
Hometap translates the legalese of long legal agreements into simple, concise English. Its documents explain what happens if the value of the homeowner’s house increases or decreases, as well as the ways customers can buy out the investment at the end of the ten-year term. “You need to put the homeowner at the center of the wheel and make sure that you’re a good actor in every possible way,” Glass said. To Glass, this includes dedicating additional resources for training employees, in order for them to clearly outline the terms of investments to customers.
“It’s our aspiration to build the best consumer brand around, and you build your brand one homeowner at a time,” Glass continued. “You just go the extra mile.”
This article originally appeared on The Financial Revolutionist. Read it here.