Has anyone used this company before? https://www.hometap.com/faqs
From their FAQ "We invest in select homes and homeowners with an upfront payment and are paid out of the proceeds when the house is sold or refinanced, which must happen within the term, 10 years after the investment date."
"Unlike a lender, we are not guaranteed a return on our investment. No interest rate, no monthly payments. Instead, we get one payment - based purely on the market value of the home - when you sell, refinance or use savings to pay out your Hometap investment."
It's an interesting concept. Of course, the details of the investment and what they get in exchange for the upfront money would matter greatly.
@Lex Miller Hi Lex! I recently came across this company and decided to proceed until I found out that there’s a power of attorney requirement. Have you gotten any additional feedback/reviews or knowledge regarding this company? Did you use them?
I did not use them. Please let us know how it goes if you do.
Hi @Lex Miller - just hopping in to shed some light on Casida's comment and answer your question. (Full disclosure, I'm the content marketing manager at Hometap). Casida is correct that there’s a power of attorney requirement, that's required to protect our investment in case of a breach of contract, same as there would be for a mortgage. One of our investment managers actually had the opportunity to speak with @Casida Caines a bit more about why we require this. It's very understandable for homeowners to ask questions like this, and we urge that they 100% understand and agree with every detail before moving forward.
To your point, what Hometap receives in exchange for the investment is of course important for the homeowner to understand, and the investment managers are completely transparent about every step of the process. There is no fine print or surprises when it comes to any fees or cost to the homeowner.
What Hometap receives in exchange for the investment is their share of the home's value at the time of the settlement (which is either ten years or when the homeowner decides to sell). If the home appreciates, Hometap receives more, and if it depreciates, Hometap receives less, and that's a risk we're willing to take. Those percentages are given to the homeowner up front before any offer is accepted.
Closing costs are based on the investment total, but they're taken from the investment, so there are absolutely no out of pocket upfront costs.