Hometap, which provides a loan alternative for tapping into home equity without taking on debt, has closed its third institutional asset investment fund on $245m.
The commitments came from Bain Capital and Group 1001’s Delaware Life Insurance Company, as well as other Hometap affiliated insurance companies. The new fund, Hometap said, is its third institutional investment vehicle and will be the largest to date.
Hometap allows homeowners to receive debt-free cash in exchange for a share of their home’s future value. Homeowners can use the cash to meet a variety of needs from paying off credit-card debt to starting a business to buying a second home. When the home sells or the homeowner settles the investment, Hometap is paid out an agreed-upon percentage of the sale price or current appraised value.
The company said its product has been positively received by its invested homeowners, many of whom have built substantial equity in their homes and were seeking partial liquidity to handle life expenses, but for whom borrowing through traditional means like a loan may not have been feasible or desirable.
Hometap CEO Jeffrey Glass, said, “While homeowners have been fairly limited in the past when it comes to financing options, the landscape is changing for the better, with innovative solutions emerging that prioritise flexibility and ease. We’re excited to be able to offer more homeowners a fast, debt-free alternative that will deliver on our mission to make their lives less stressful.”
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