Unlock Review: Get Cash in Exchange for Your Home’s Equity

Best Overall

4.7 _/5

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Home Equity Investment

• Access $30,000 to $500,000 in home equity
• No monthly payments or interest charges
• Option to buy out Unlock’s share in partial payments over the term
• Receive an estimate without impacting your credit score

• Origination fee of 4.9%
• Only available in AZ, CA, CO, FL, MI, NJ, NC, OR, PA, SC, TN, UT, VA, and WA

Unlock earns the title of best overall home equity investment because it offers a unique feature that most competitors don’t: the option for partial payments. 

Most competitors require that you settle these agreements—which allow you to tap into your home’s equity for cash without taking on debt—in one lump sum. But Unlock’s partial payments give you control over your finances throughout the term.

Unlock also sets itself apart with a lower credit score requirement—500 minimum—making it an accessible option for individuals who might not qualify for traditional home equity loans or home equity lines of credit (HELOCs).

About Unlock

Unlock was founded to offer homeowners a unique avenue to leverage their home’s value. Specializing in home equity investments—a financial model where the company invests in a homeowner’s property in exchange for a share of the home’s future value—Unlock provides an alternative to traditional loans and debt. 

This model can benefit those needing to finance specific endeavors, such as home renovations, or navigating a financial hardship like job loss.

Geared toward homeowners with significant property equity, Unlock fills a unique niche in the financial landscape with an option that differs from traditional home equity loans and reverse mortgages.

How does Unlock work?

Unlock offers homeowners a way to tap into their home’s equity without incurring more debt. Through a home equity investment, which Unlock calls a “home equity agreement,” you get cash upfront in exchange for a share of your home’s future value. When the term ends, you settle the balance by selling your home or buying out Unlock’s share.

Here are several important terms to know:

• Investment amounts: The cash you get from Unlock is based on a percentage of your home’s value, with a minimum of $30,000 and up to $500,000. The amount is based on factors such as your home’s current value, what you still owe on the home (if anything), your credit history, and the use of the property.
• Term length: Unlock’s 10-year term gives you a decade to sell your home or buy out Unlock’s share of the future home value.
• Repayment options: You have three paths to settle the balance:
  1. At the end of your 10-year term, sell your home and share the proceeds with Unlock based on the agreed percentage
  2. Buy out Unlock’s share at the current home value at the end of your 10-year term.
  3. Make partial buyouts throughout the 10-year term.
• Fees: Unlock deducts transaction expenses and a 4.9% origination fee at closing. These fees may vary and include appraisal, inspection, and title fees.
• Unique features: One standout feature is the option for partial buyouts throughout the term. This flexibility is rare among competitors.

Who’s eligible for a Unlock home equity agreement?

Eligibility for Unlock’s home equity agreement involves jumping through fewer hoops than a traditional loan. However, your property type, location, and credit score matter. 

Unlock doesn’t specify whether both spouses need to be on an application, but it’s generally wise to include all co-owners in financial agreements involving shared property.

Requirements	Details
Properties	Most residential real estate, including primary homes, second homes, and rental properties. No tenancy-in-common properties or mobile homes.
State of residence	AZ, CA, CO, FL, MI, NJ, NC, OR, PA, SC, TN, UT, VA, and WA
Maximum loan-to-value	80%
Maximum debt-to-income	45%
Minimum credit score	500
Minimum income	Not disclosed
Other requirements	Must maintain property, pay taxes and home insurance, and first-lien (primary) mortgage (if applicable)

How do you repay a home equity agreement from Unlock?

Repayment with Unlock differs from traditional loans. You’re not bound by monthly payments. The term length for Unlock’s home equity agreement is 10 years. At the end of this term, you have two options for repayment:

• Sell your home: You can sell your property and pay Unlock its share from the sale proceeds.
• Buy out Unlock: End your agreement by buying out Unlock’s stake in your property at its then-current value.

You also have a third repayment option: make partial buyout payments throughout the 10-year term. This unique feature of Unlock allows you to make partial payments toward buying out its share, increasing your home equity over time.

Your repayment amount will vary based on your home’s value at the end of the term. If your property’s value has increased, so will Unlock’s share.

How much does Unlock cost?

Unlock charges an origination fee of 4.9%, deducted at closing, along with transaction expenses. These costs include fees for appraisal, title, and other third-party services. You can pay the fees out of pocket or subtract them from the investment payment from Unlock.

How is the final payment calculated?

Several factors impact your final payment.

• Investment payment: The initial cash amount you get from Unlock.
• Starting home value: The appraised value of your home when the agreement starts.
• Investment percentage: The investment payment expressed as a percentage of the starting home value.
• Exchange rate: Multiply this rate by the investment percentage to derive the percentage of your home’s value Unlock receives. It’s often set at 2.0 but can vary based on your situation (see below).
• Unlock percentage: This is the portion of your home’s future value you’ll share with Unlock.

Here’s an example Unlock provides to illustrate how final repayment works:

• You receive an investment payment of $60,00 on a home valued at $600,000.
• This yields an investment percentage of 10%. 
• The exchange rate is 2.0.
• So your Unlock percentage is 20%.

If your home value increases

You decide to sell your house 10 years later, and its value has increased by an average of about 3% per year to an ending home value of $806,000.  

At closing, Unlock’s share of the sale proceeds (called the Unlock share) is calculated as: 

Ending home value   x   Unlock percentage   =   Unlock share $806,000 x 20% = $161,200 

If your home value decreases

You sell your house 10 years later, but this time, your home’s value has decreased by 10% to $540,000. The Unlock share is calculated as: 

Ending home value x Unlock percentage   =   Unlock share $540,000 x 20% = $108,000 

Your home value doesn’t change

Here we’ll assume you sell 10 years later and your home’s value is $600,000. The Unlock share is calculated as: 

Ending home value  x  Unlock percentage  =  Unlock share $600,000 x 20% =  $120,000

Note that the exchange rate can vary and that plays a large role in your total cost. Unlock provides the following examples:

• Owner-occupied homes: 2.05, which translates to a 20.5% Unlock percentage
• Rental or high-risk owner-occupied: 2.1, resulting in a 21% Unlock percentage
• Higher risk: 2.15, leading to a 21.5% Unlock percentage

Unlock also features an annualized cost limit of 19.9%. This limit caps the annualized growth rate of the amount you owe. If the annualized cost limit applies at the end of the term, it takes precedence over the exchange rate for determining your final payment. 

In simpler terms, if the home value rises significantly, leading to an astronomical payoff amount, the annualized cost limit helps cap that cost. 

Unlock provides this table to see how and when the limit comes into play. You can see how in the cells shaded green (term lengths of one to five years), the annualized cost limit trumps the exchange rate, indicating that the faster you pay off the Unlock share, the more you can potentially save.

Term length (years)	Ending home value	Calculated Unlock share	Actual Unlock share	Annualized cost
1	$618,000	$123,600	$71,940	19.90%
2	$637,000	$127,400	$86,256	19.90%
3	$656,000	$131,200	$103,421	19.90%
4	$675,000	$135,000	$124,002	19.90%
5	$696,000	$139,200	$139,200	18.33%
6	$716,000	$143,200	$143,200	15.60%
7	$738,000	$147,600	$147,600	13.72%
8	$760,000	$152,000	$152,000	12.32%
9	$783,000	$156,600	$156,600	11.25%
10	$806,000	$161,200	$161,200	10.39%

Does Unlock have any control over my home or its condition?

Unlock does not exercise direct control over your home during the term of the home equity agreement. Ownership and primary decision-making for the property remain with you. However, specific provisions related to home improvements and maintenance are worth noting.

Eligibility for home improvements

Homeowners may make improvements to their property. Furthermore, Unlock offers an improvement adjustment. For example, if renovations increase the home’s value by $40,000, an approved application for an improvement adjustment would exclude this amount from the amount you owe Unlock at the end of your agreement.

Requirements for home maintenance

Unlock expects homeowners to maintain their property adequately and includes a maintenance adjustment in its agreement. 

Should the home lose value due to lack of maintenance, for example, if it sustains extensive termite damage, Unlock has the right to adjust the ending home value upward before calculating your shared amount. This means Unlock does not partake in the loss resulting from property neglect.

Sharable value calculation
Many homeowners see improvement and maintenance adjustments come into play during their home equity agreement term. When this occurs, Unlock is entitled to the agreed-on percentage of the “sharable value,” calculated like this:

Ending home value – Improvement adjustment + Maintenance adjustment = Unlock’s shareable value

Inspection criteria and property condition

While homeowners maintain full autonomy over their property, they are expected to keep the home in good condition. There is no indication of mandatory periodic inspections; however, failure to maintain the property could trigger the maintenance adjustment.

Pros and cons of Unlock

Pros

• Partial payouts allowed

  Unlock permits partial payouts, unlike most competitors, who require lump-sum payments.

• Lower credit score requirement

  Unlock’s lenient credit requirements offer an avenue for those who may not qualify for traditional home equity loans or HELOCs.

• Dedicated home equity consultant

  A dedicated home equity consultant guides you through the process, adding a personalized touch.

Cons

• State limitations

  Unlock services are restricted to 15 states, limiting accessibility for many homeowners.

• Property type limitations

  The service is constrained to certain property types, which might not include everyone’s living situation.

• Limited term length

  Unlock offers just one 10-year term, unlike competitors Point and Unison, which offer terms up to 30 years.

• Higher competing limits

  Hometap allows loans up to $600,000, which may be more suitable for homeowners needing larger amounts compared to Unlock’s $500,000.

Unlock offers a unique, flexible approach to tapping into home equity, especially beneficial for those with lower credit scores. However, its service limitations related to location and property types could be a deal breaker for some. 

If you’re in search of longer term lengths or higher loan amounts, competitors such as Point, Hometap, and Unison may offer a better fit for your needs.

Is Unlock a reputable lender?

Source	Customer rating	Number of reviews
Trustpilot	4.7 out of 5	757
Better Business Bureau	3.94 out of 5	53
Google	4.1 out of 5	32

Reviews collected on March 1, 2024

Unlock generally enjoys positive feedback from customers. Trustpilot ratings highlight a straightforward and relatively stress-free process, along with good customer service. 

The Better Business Bureau (BBB) gives Unlock an “A” rating and accreditation, echoing the sentiments of Trustpilot reviewers, including stories of Unlock helping those who were denied a HELOC. However, three of the six Google reviews cite poor customer service and lower-than-expected home appraisals.

Trustpilot and the BBB are established platforms for consumer reviews and have robust systems to verify the authenticity of reviews. The BBB’s accreditation also indicates that Unlock meets specific standards of honesty and transparency. 

Google’s platform offers a more spontaneous customer sentiment, which provides a balanced perspective. Given the overall high ratings and accreditation, Unlock seems to be a reputable lender, though prospective clients should be aware of the noted concerns.

Does Unlock have a customer service team?

Unlock’s customer service team operates out of New York City, ready to assist you with any queries or concerns you may have regarding your home equity investment. From the application process to repayment terms, the team aims to provide comprehensive support.

Ways to contact Unlock:

• Email: [email protected]
• Phone number: 1-800-560-3450 (8:30 a.m. – 5:30 p.m. Pacific time)
• Mailing Address: 5 Bryant Park, Floor 23 New York, NY 10018
• Social Media:
  • Facebook
  • LinkedIn
  • X (formerly Twitter)

By offering multiple channels of communication, Unlock strives to be accessible and responsive to your needs.

How to apply for a Unlock home equity agreement

Compared to other companies in the home equity space, Unlock’s application process stands out for its simplicity and quickness. Getting an estimate takes just two minutes, won’t dent your credit score, and gives you a clearer sense of your options without any obligations.

Here are the steps to apply: 

1. Get an estimate: The first step requires minimal effort. Just fill out an online form to get an estimate; this takes approximately two minutes and has no impact on your credit score.

2. Apply online: Once you decide to proceed, Unlock assigns a dedicated home equity consultant to guide you through the application process. Expect this step to take a day or two.
3. Review your offer: After reviewing your independent third-party appraisal and title report, Unlock prepares an offer for you. This often happens within a week.
4. Your home equity agreement funds: After you sign the closing documents, expect a secure wire transfer within a few days. Be sure you have all necessary identification and property-related documents to speed up the process.

This streamlined process not only expedites the funding but also minimizes the typical stress associated with financial transactions.

What if I’m denied a home equity agreement from Unlock?

Being denied by Unlock isn’t the end of the road. The company should provide reasons for the denial, which could range from low property valuation to an unsatisfactory credit score. While the news might be disappointing, it’s an opportunity for you to address these issues and reapply or look elsewhere.

Common reasons for denial and next steps:

• Poor credit score: A credit boost might make you eligible next time around.
• High debt-to-income ratio: Lowering debt can improve your eligibility.
• Property location: Services are state-specific, so geographic limitations can be a factor.
• Inadequate home equity: Make sure you have enough equity in your home to meet Unlock’s criteria. The minimum investment amount is $30,000. You can learn how to calculate your home equity and loan-to-value ratio here. 
• Low property valuation: If your property doesn’t have the value required for an Unlock home equity agreement, you might consider alternatives, like a personal loan, to access the funds you need. 

If you’re denied, don’t get discouraged. It might be a good time to explore other lenders or alternatives to Unlock. For more insights on home equity companies that might be a better fit, check out this comprehensive list.

How do other home equity products compare to Unlock?

Unlock offers a distinct way to tap into your home’s equity without monthly payments or interest rates. Unlike a home equity line of credit (HELOC) or a home equity loan, both of which require monthly repayments, Unlock shares in the future value of your home. This feature can be appealing if you’re not interested in taking on more monthly debt.

In contrast, a reverse mortgage is more like Unlock in that it doesn’t require monthly payments, but it’s generally targeted at older homeowners and can come with more complex terms and higher fees. 

Unlock provides a more flexible equity arrangement for a broader demographic, allowing homeowners to access cash without incurring debt. This unique approach positions it as an alternative worth considering alongside traditional home equity options.

Unlock FAQ

How long does it take to receive funds from Unlock?

After completing your application and getting an appraisal, the typical timeline to get funds from Unlock is short. Once you’ve signed the closing documents, expect a secure wire transfer within a few days. The streamlined process is designed to get the funds into your hands as soon as possible.

Do you need to tell Unlock what the funds are used for?

Unlock doesn’t require you to specify what you’ll use the funds for during the application process. There’s no question about this on the application, and your intended use doesn’t affect your eligibility. The focus is more on your property value and other qualifying criteria, giving you the freedom to use the funds as you see fit.

Are there any tax implications for using Unlock?

A home equity investment from Unlock doesn’t have the same tax implications as a home equity loan or HELOC, where interest payments could be tax-deductible. There’s generally no immediate tax impact when you receive the funds. 

However, when it comes time to settle the investment, you may have capital gains tax obligations. We recommend consulting with a tax professional to understand the implications for your situation.

What happens if my home is damaged or destroyed during the term?

If your home suffers significant damage, such as from a natural disaster, it could affect the home’s value and, by extension, your agreement with Unlock. Generally, you would need to repair the home using your insurance payouts, personal funds, or additional financing to maintain the property’s value.

What happens if I die or become permanently disabled?

If you pass away or become disabled, the home equity agreement typically becomes due. This means your estate would be responsible for settling the account. In some cases, a family member can assume the agreement, but that would require approval from Unlock. Planning for these scenarios in advance can alleviate potential stresses for your loved ones.

How we rated Unlock

We designed LendEDU’s editorial rating system to help consumers identify companies that offer the best financial products. Our experts spend hours researching these companies each year to ensure our ratings are fresh and accurate.

Our most recent evaluation compared Unlock to several companies across a number of factors, including cash offers, repayment terms, customer reviews, and fees. We weighted, scored, and combined each factor to produce a final editorial rating. This rating is expressed on a scale from 1 to 5, with 5 being the highest possible score. We round all ratings to the nearest tenth decimal place.

Product	Best for	Our rating
Home equity investment	Best overall	4.7	Check your offer

4.7 Unlock Home Equity Sharing Agreement