Updated
Apr 05, 2023 Founded in 2015, Point is a home lending startup to make home equity borrowing accessible for more homeowners. It offers a flagship product called a home equity investment (HEI). In addition, borrowers in California can qualify for a home equity line of credit (HELOC).
As of December 2022, Palo Alto, California-based Point’s products are available in 23 states (listed below) and the District of Columbia. Its home equity product availability is expanding, and Point has a waitlist, so you can find out as soon as Point offers products in your area.
In this review:
- How does Point help me access my home equity?
- Point rates, terms, fees, and limits
- Pros and cons of a Point Home Equity Investment
- What do Point’s customers say?
- Do I qualify to sell my home equity with Point?
- How do I apply with Point?
- How does Point determine how much equity I can access?
- What does the appraisal process look like?
- Does Point charge any fees?
- Does Point have a customer service team?
How does Point help me access my home equity?
When most homeowners want to access the cash tied up in their home, they take out a home equity loan or a home equity line of credit (HELOC).
These are tried and true approaches to accessing affordable financing from your home’s equity. Point offers a HELOC that allows borrowers in California to borrow as much as $500,000 of their home’s current value. HELOCs and home equity loans leave homeowners with monthly payments.
When borrowing against the equity you’ve built in your home, you have another option: shared appreciation mortgages, aka shared equity loans. These home loans work differently from traditional home equity loans because you don’t pay interest or make monthly payments. Instead, your lender shares in your home’s future appreciation (or depreciation).
Point Home Equity provides this type of shared equity loan. This Point review will explain how the process works and what Point offers so you can decide if this kind of funding makes sense.
Point rates, terms, fees, and limits
If you’re thinking about borrowing against your home’s equity with Point, here are important details to help with your decision-making.
Point HELOC
Point HELOCs are available in California to homeowners with single-family homes, condominiums, or owner-occupied residences with two to four units. Co-ops, multifamily properties with more than four units, and manufactured or mobile homes are excluded.
Point will fund your HELOC in as little as three weeks. Depending on your home’s equity, you can borrow between $10,000 to $500,000 against the property, with interest rates as low as 6.25% APR.
Point allows a maximum loan-to-value ratio (LTV) of 80%. This may vary based on your credit history, debt-to-income ratio (DTI), and location.
| Point HELOC | |
| Loan limits | $10,000 to $500,000 |
| Minimum draw | $50,000 (or 100% of your limit if the line of credit is $50,000 or less) |
| Maximum term | 30 years |
| Interest rates (APR) | Starting at 6.25% |
| Maximum LTV | 80% |
| Maximum DTI | Not disclosed |
| Minimum credit score | Not disclosed |
| Minimum income | Not disclosed |
| Fees | 3% processing fee ($1,000 minimum). Appraisal costs (amount not disclosed). Escrow and government fees (amount not disclosed). |
Point HEI
With a home equity investment (HEI) from Point, you can borrow against a percentage of your home’s future appreciation through an upfront lump sum. This loan is good for up to 30 years, but you don’t need to make monthly payments along the way, and interest charges won’t accrue.
Instead, when you sell your property, you must repay Point based on your home’s appreciation up to that date. You’ll pay back the original borrowed amount and a percentage of your home’s appreciation above a specific valuation. So the dollar amount you’ll repay can vary. Point will share in that value loss if your home depreciates during this time.
Point doesn’t state an income requirement to qualify for an HEI, and it accepts credit scores of 500 and up. You can prequalify without affecting your credit and get an estimate online in as little as 60 seconds.
| Point HEI | |
| Loan limits | $10,000 to $500,000 |
| Interest rates (APR) | None |
| Term | 30 years |
| Maximum LTV | 80% |
| Minimum credit score | 500 |
| Minimum income | None |
| Fees | 3% processing fee ($1,000 minimum). Appraisal costs (amount not disclosed). Escrow and government fees (amount not disclosed). |
Pros and cons of a Point Home Equity Investment
Pros
- No monthly payments. You don’t have to make monthly payments with a Point HEI, unlike when you take out a standard home equity loan or HELOC. This can be a terrific option for borrowers who are equity-rich but cash-poor.
- Point shares in the risk with you. If your home goes down in value, Point shares in this decline so you can spread the burden of your loss. This also makes your shared equity loan more affordable.
- It may be easier to qualify. Your credit score and debt-to-income ratio don’t matter as much with Point as when you take out many other types of loans. However, Point indicates borrowers with solid credit are more likely to get approved, and lower-credit borrowers may need additional equity.
- You retain control of your home. Point doesn’t get added to the title of your property, you keep living in your house, and you decide when to sell it—as long as you repay Point its share of your equity within 30 years.
Cons
- You could end up paying more. If your home value increases substantially over 30 years, you could pay much more than you would for a traditional home equity loan.
- Point undervalues your home. Point uses a risk-adjusted home value of up to 20% less than your home’s appraisal amount. This offsets slight declines in your home’s value to protect Point’s investment, but it still shares in significant value declines, and its upside is capped.
- You don’t have access to ongoing cash. Point gives you a one-time lump sum when investing in the equity in your home. As with a HELOC, you can’t access funds as needed for several years. That makes these types of loans best to pay off a specific debt or finance a big purchase, while a home equity line of credit may be better if you’re looking for an ongoing source of cash.
- Access is limited. Point Equity is available in a limited number of places and only to homeowners whose homes are likely to appreciate. You have broader access to general home equity loans and lines of credit.
If you’re unsure whether Point is the right fit for your home equity needs, check out the following resources:
What do Point’s customers say about the company?
| Source | Rating | Number of reviews |
| Better Business Bureau | 4.37 out of 5 stars | 219 |
| Trustpilot | 4.4 out of 5 stars | 1,384 |
Ratings collected on December 7, 2022.
Reviews and feedback from existing customers can give you a more comprehensive view of how a lender operates and whether other customers have had a positive experience.
One trusted platform is the Better Business Bureau (BBB), a consumer agency designed to encourage trust in the marketplace. According to the BBB, Point is an accredited lender with an A+ rating. Point also has a rating of 4.37 out of 5 stars, with over 200 customer reviews.
Another review platform to consider is Trustpilot, where consumers can leave feedback on their experience with companies. Through Trustpilot, Point earns a rating of 4.4 out of 5 stars, with more than 1,350 consumer reviews.
Customers praise Point for a smooth application process and closing, excellent communication with customer service representatives, and transparency throughout the process.
Do I qualify to sell my home equity with Point?
You can qualify for a Point Home Equity Investment if all the following are true:
- Your home is well-maintained and in an area where it’s likely to appreciate.
- You have a strong credit history or evidence your credit is improving.
- You have equity in your home. Point often wants you to retain at least 20% of the equity in your home after its investment. And if you live in a condo, already have a second mortgage, or have poor credit, you may need more equity.
As of December 2022, Point is available in the following 23 states and the District of Columbia:
- Arizona
- California
- Colorado
- Connecticut
- Florida
- Georgia
- Hawaii
- Illinois
- Maryland
- Massachusetts
- Michigan
- Minnesota
- Nevada
- New Jersey
- New York
- North Carolina
- Ohio
- Oregon
- Pennsylvania
- Tennessee
- Utah
- Virginia
- Washington
How do I apply with Point?
If you decide to get funding through Point, the borrowing process includes seven steps:
- Ensure your home address is within the covered area. (Even if Point HEIs are available in your state, it may exclude your address.)
- Get an online estimate on your home and see if it qualifies. When you enter your address, Point will assign an initial home value estimate, allowing you to calculate how much you may be able to borrow.
- Choose how much you want to borrow and how long you want your loan term to last.
- Review the different scenarios and costs. This allows you to see how much you might pay Point whether your home’s value appreciates, depreciates, or remains the same.
- Complete your online application, and upload the required documents.
- Undergo a home visit with an appraiser who will value your home.
- Close on the loan, and get your funds (minus a transaction fee, appraisal fee, and escrow fee).
How does Point determine how much equity I can access?
Before Point can decide how much to lend you, it needs to determine how much equity you have in your home.
After you enter your address, Point will access public records to get a rough idea of your home’s current value. You’ll then be asked to enter your remaining mortgage balance (if any), which will help the lender calculate your available equity.
Point allows a maximum CLTV of 80%, so you must retain at least 20% equity once your mortgage balance is factored in and you’ve chosen your loan amount.
So if your property’s current value is $500,000, and you don’t have a mortgage or other lien on the property, you could access up to $400,000 based on the following calculation:
$500,000 value x 80% CLTV = maximum $400,000 Point HEI
A balance on a mortgage loan would reduce your limit. Using the same example above, let’s say your remaining mortgage balance was $100,000. Your maximum line of credit would be $300,000:
$400,000 maximum Point HEI – $100,000 outstanding mortgage = $300,000 available
However, depending on your income, credit score, and location, you may be limited to borrowing less.
What does the appraisal process look like?
Before you borrow, you and Point must agree on the fair value of your home. This often involves a home appraisal.
Point will order your home appraisal, and an unbiased third-party inspector will conduct it. This appraiser will look at your home’s location, size, age, features, condition, and more. They will also consider “comps”—recently sold comparable homes nearby—to gauge how much buyers may be willing to pay for your home in the present market.
Once this report is complete, Point will use it to calculate your maximum HEI or HELOC.
If you take a Point HEI, you should plan to sell the home or buy back the equity within 30 years of taking the loan. If you don’t want to sell the house in 30 years and don’t have the cash on hand, you could refinance your mortgage to get the money you need.
Does Point charge any fees?
You’ll encounter several fees taking out an HEI or HELOC from Point.
| Point fees | |
| Processing fee | 3% – 4% ($1,000 minimum) |
| Appraisal fee | Not disclosed |
| Escrow fee | Not disclosed |
| Government fees | Not disclosed |
These fees are required, but the amount may vary and is not specified before Point processes your application.
Does Point have a customer service team?
Whether you have questions before applying or need help servicing your home equity product, you can reach Point in two ways.
- By phone: Reach a Point representative Monday through Thursday from 6 a.m. to 6 p.m. Pacific time, or Fridays from 6 a.m. to 4 p.m. Pacific, at 888-764-6823.
- By online contact form: Point offers an online form if you want to ask questions about its products and services. One of Point’s representatives will reach out during business hours to address your request.