Not All Equity Sharing Is Equal

Feb 20, 2020

Laura Hill

Changing economic models are intriguing, as they typically reflect socio-political and cultural shifts. The age of the sharing economy is here, and it’s hitting numerous segments of our life. Think of the way we get around (Uber, Lyft, Zipcar, etc.), how we sojourn while travelling (Airbnb, FlipKey, HomeAway, etc.), utilize co-working platforms (WeWork, Regus, HeraHub, etc.), dress up for nice events (Rent the Runaway, Le Tote, RockBox, etc.), and the list could go on with many more notorious examples. Some may think that a sharing economy is just focused on maximizing the use and usefulness of an otherwise underutilized asset (car, condo, etc.), and a way to make a profit as a result. Although that’s true, it is only partly so. A shared economy is more than acquiring, providing or sharing access to goods and services. It’s about participation, collaboration, and helpfulness. It occurs when we realize that, as people, we are stronger together than separated, we make better use of our belongings when others can benefit from them too, and the flow that connects one person to the next is actually enjoyable, enriching, and financially rewarding too.

Now, think of your home… the one you live in, or maybe the one you want to own one day, your dream home, or your starter home. Whatever home comes to mind, there are emotions connected to it because your home is where your story begins. Home is where we raise our family, where memories are created, and typically where we store most of our wealth. It’s an incredibly important place for each of us, and the choice we make requires we approach the topic with a heightened financial awareness.

Our home equity sharing is a financing path for those who want to start building their ideal future in the place they truly wish to be. The Equity Funding Instrument (EFI™), our core product, can help with your down payment if you are buying a home, and it can also assist you in accessing equity in your home, if you need liquidity. In both cases you share a portion of the future value of your home with a co-investor. So, instead of borrowing as much as you can, you can reduce that debt with a co-investor. When you borrow you pay interest to an investor that lends you money; with an EFI you share a portion of your home value with an investor when you sell – and there’s no monthly payment because it’s not a loan. Funny thing is… many of those investors who want to co-invest in your home are the same investors that buy your home loan after it’s originated. That’s because banks and mortgage companies don’t want to hold a loan after it’s been funded.

At EquiFi we take great care in providing the fairest pricing possible to our customers. We have literally spent years and years cultivating investor relations. When the investor market wanted more than what we thought was fair to the consumer we simply said NO! We only work with those who understand our values, and we now have a great lineup of investors who want to help you get the right financing for your home. It’s hard enough to live paycheck-to-paycheck and have little to nothing to save. Knowing that, we certainly did not want to burden consumers with an expensive equity product. It is imperative that you fully understand the terms of the transaction under any number of economic scenarios. All financing comes with a price, but we’re confident that in the end our equity sharing program will allow you to live in your ideal home and be better prepared for the wealth creation which home ownership can bring. Next chapter, let’s talk about more financial choices, evaluating risks and getting smarter about one’s financial wealth. Thanks for visiting us. Until next time!