Home Equity Hub: Your Complete Guide to HEIs, HELOCs & Tapping Into Your Equity
By: WalletGrower Financial Team | Updated: March 2026 | Read Time: 18 minutes
Quick Answer
Whether you need cash for renovations, debt consolidation, or financial flexibility, your home equity is one of your most powerful assets. This hub covers everything you need to know: Home Equity Investments (HEIs), HELOCs, home equity loans, real-world comparisons, company reviews, and step-by-step calculators—all in one place. Whether you have excellent credit or are just starting to rebuild, there’s a path forward.
Editorial & Expertise Credibility: The WalletGrower team has spent 200+ hours researching home equity products, interviewing industry professionals, and stress-testing calculators to build this comprehensive resource. We maintain transparent affiliate relationships with some providers, but all editorial recommendations remain independent and prioritize your financial interests. Last verified: March 2026.
What Is Home Equity?
Home equity is simple to understand: it’s the difference between what your home is worth and what you still owe on your mortgage. For example, if your home is valued at $400,000 and you have a $250,000 mortgage balance, you have $150,000 in equity.
Here’s why this matters: for most Americans, their primary residence is their single largest asset. According to recent data, the average homeowner has over $300,000 in home equity—yet many don’t realize they can tap into this locked-up wealth for important financial goals.
Your home equity can be accessed for renovations that increase your home’s value, debt consolidation to lower monthly payments, unexpected medical bills, education costs, or starting a business. The key is understanding your options and choosing the method that aligns with your financial situation and goals.
Unlike taking out a personal loan (unsecured debt), accessing home equity uses your property as collateral, which typically means lower interest rates and larger borrowing amounts. However, this also means your home is at risk if you cannot make payments.
4 Ways to Access Your Home Equity
You have multiple paths to unlock your home equity. Each has different costs, flexibility, and requirements. Here’s a quick comparison to help you understand your options:
| Method | Monthly Payment | Min. Credit Score | Best For |
|---|---|---|---|
| Home Equity Investment (HEI) | None | 500+ | No payment access, low credit, flexible terms |
| HELOC | Yes (variable) | 620+ | Flexible borrowing, lowest ongoing cost |
| Home Equity Loan (Fixed) | Yes (fixed) | 620+ | One-time large need, predictable payments |
| Cash-Out Refinance | Yes (replaces mortgage) | 620+ | Large amounts, excellent rates, long timeline |
Each method works differently depending on your credit score, income stability, and how quickly you need funds. The rest of this guide focuses on HEIs and HELOCs—the two most flexible and accessible options for most homeowners.
Home Equity Investments (HEIs) Explained
What Is an HEI?
A Home Equity Investment is a form of equity sharing where a company provides you with cash upfront in exchange for a percentage of your home’s future appreciation. Unlike a loan, there are no monthly payments, no interest, and no debt obligation.
How Does It Work?
Here’s the basic mechanics: You own a $500,000 home with $150,000 equity. A home equity investment company gives you $50,000 cash in exchange for 15% of any future appreciation (or depreciation, in some cases) over 10-30 years. If your home appreciates to $600,000, they receive 15% of the $100,000 gain ($15,000). If it deprecates, you may be protected depending on the terms.
Typical Terms
- Investment period: 10–30 years (varies by company)
- Credit score requirement: 500+ (no income verification needed)
- Minimum equity: Typically 20%–25% of home value
- Origination fee: 4–5% of investment amount (varies)
- Early payoff: Most allow early payoff without penalties
Who Benefits Most?
HEIs are ideal for:
- Self-employed individuals who struggle with HELOC/loan income verification
- People with lower credit scores (600 or below)
- Retirees on fixed incomes who cannot afford monthly payments
- Homeowners who want immediate cash without debt obligations
Costs & Risks
Key Risk: Appreciation Sharing
If your home appreciates significantly, an HEI can become expensive. A 15% share of $200,000 in appreciation = $30,000 paid to the investor. A traditional HELOC or loan might have been cheaper in that scenario.
For detailed analysis and company-by-company breakdowns, see our Complete Home Equity Investment Guide.
HELOCs Explained
What Is a HELOC?
A Home Equity Line of Credit (HELOC) is a revolving credit line secured by your home equity—similar to a credit card, but backed by your property instead of unsecured. You can draw, repay, and redraw funds during your “draw period,” then transition to a repayment period where you pay down the balance.
Current Market Rates
As of March 2026, the national average HELOC rate is approximately 7.17% (variable). Rates vary by lender, credit score, and equity percentage. Fixed-rate HELOCs are also available but typically cost 0.5–1% more.
Draw Period vs. Repayment Period
- Draw Period (typically 5–10 years): You can borrow and repay multiple times. Many lenders only require interest-only payments, keeping monthly costs low.
- Repayment Period (typically 10–20 years): The credit line closes, and you begin paying down the principal plus interest on any outstanding balance.
Key Advantages
- Flexibility: Draw only what you need, when you need it
- Lower ongoing cost: Interest-only payments during draw period keep monthly costs low
- Tax-deductible interest: In many cases, HELOC interest is tax-deductible (consult a tax professional)
- Refinancing potential: Can refinance to a fixed rate if you want payment certainty
Key Risks
Variable Rate Risk
Most HELOCs have variable rates tied to the prime rate. If rates rise, so do your payments—potentially making the HELOC unaffordable during the repayment period.
For a comprehensive walkthrough with payment examples and rate trends, read our HELOC Guide for 2026.
💡 Explore Home Equity Investments
Looking for an HEI with the longest terms available? Splitero offers up to 30-year investment periods with a 500+ credit score requirement and no income verification needed.
Explore SpliteroSplitero is a Fiat Growth portfolio company. This means we have a direct relationship with the team and have tested their process firsthand.
HEI vs HELOC: Which Is Right for You?
Both HEIs and HELOCs access your home equity, but they work very differently. Here’s a detailed comparison to help you decide:
| Factor | HEI | HELOC |
|---|---|---|
| Monthly Payment | None | Yes (interest-only or principal+interest) |
| Typical Cost (10 years) | 15–20% of home appreciation | 7–10% in interest + origination |
| Credit Score Required | 500+ | 620+ |
| Income Verification | None required | Full documentation |
| Term Length | 10–30 years | Draw 5–10 yrs + Repay 10–20 yrs |
| Rate Type | Fixed (appreciation share) | Variable (most) or Fixed |
| Best For | Low credit, no monthly budget, long-term needs | Good credit, flexibility, ongoing needs |
Pros & Cons: HEI
✅ Pros
- No monthly payments to manage
- Easier qualification (500+ credit score)
- Self-employed friendly (no income docs)
- Long terms (up to 30 years)
- No debt on your balance sheet
❌ Cons
- Expensive if home appreciates strongly
- Origination fees (4–5%)
- Limited availability (not all states)
- Lower investment amounts vs. HELOC
- Appreciation share locked in for 10–30 years
Pros & Cons: HELOC
✅ Pros
- Lower total cost (interest only, no appreciation share)
- Flexible draw/repay cycles
- Available nationwide
- Higher borrowing limits (up to 80%+ equity)
- Interest may be tax-deductible
❌ Cons
- Monthly payments required
- Higher credit score needed (620+)
- Income verification required
- Variable rates (rate risk during repayment)
- Creates debt obligation on your credit report
For a side-by-side detailed breakdown with real scenarios, see our HEI vs HELOC comparison guide.
Top HEI Companies Reviewed
We’ve evaluated the leading home equity investment companies based on term length, availability, ease of process, fees, and customer reviews. Here’s our breakdown:
Splitero
A Fiat Growth portfolio company — we’ve tested their platform firsthand and maintain an ongoing relationship with their team.
- Investment Terms: Up to 30 years (longest available)
- Credit Score: 500+ (no income verification)
- Investment Range: $15,000 – $600,000
- Origination Fee: 4.99%
- Available States: 14 states (expanding)
- Unique Feature: Longest terms in the market, self-employed friendly
- Processing Time: 2–4 weeks
Splitero is our top pick for borrowers who prioritize the longest possible terms and maximum flexibility. Their 30-year investment periods give you the most time to benefit from your equity without pressure to refinance.
Read Full Splitero ReviewHometap
- Investment Terms: 10 years
- Credit Score: 600+ recommended
- Max Investment: Up to $600,000
- Minimum Equity: 25%
- Available States: 17 states + DC
- Customer Rating: 4.8/5 on Trustpilot
- Best For: Borrowers comfortable with 10-year terms who want a trusted, established player
Point
- Investment Terms: 30 years
- Credit Score: No minimum (flexible)
- Available States: 29 states + DC (widest availability)
- Unique Feature: Homeowner Protection Cap limits maximum payout
- Processing: Fast online process
- Best For: National coverage and long 30-year terms with protection features
Unlock
- Investment Terms: 10 years
- Credit Score: 500+ (self-employed friendly)
- Tech Experience: Modern, intuitive digital platform
- Transparency: Clear upfront pricing with no surprises
- Processing: Fastest online application
- Best For: Tech-savvy borrowers who value digital experience and transparency
Unison
- Investment Terms: 30 years
- Investment Range: $30,000 – $500,000
- Unique Feature: Shares both gains AND losses (after 5-year period)
- Downside Protection: Built-in risk sharing if home depreciates
- Best For: Borrowers seeking long terms with mutual risk/reward alignment
- Note: Loss sharing feature may require careful evaluation
For comprehensive reviews of each company including customer experiences, application processes, and detailed fee breakdowns, see our Best HEI Companies 2026 article.
📊 Monitor Your Credit While Shopping
As you explore home equity options, it’s smart to monitor your credit score and understand what lenders will see. Credit Sesame gives you real-time credit monitoring and detailed insights into how home equity inquiries affect your credit.
Get Free Credit MonitoringCalculators & Tools
Understanding the numbers is critical to making the right decision. Use these calculators to estimate costs, compare options, and see exactly how much you could access:
HEI Calculator
See exactly what an HEI would cost based on your home value, equity, and company choice.
Use CalculatorHELOC Calculator
Estimate your HELOC monthly payments, interest costs, and total repayment amount at various rates.
Use CalculatorHome Equity Estimator
Find out how much equity you can actually access based on home value and mortgage balance.
Use EstimatorHEI vs HELOC Comparison
Side-by-side cost comparison showing total interest/appreciation share over your chosen term.
Use Comparison ToolReady to Compare Your Options?
Use our interactive comparison tool to see side-by-side HEI vs HELOC costs and determine which path makes the most sense for your financial situation.
Start Your ComparisonIn-Depth Guides & Articles
Dig deeper into specific topics with our comprehensive guide articles:
- What Is a Home Equity Investment? Complete Guide — A deep dive into how HEIs work, eligibility, costs, and when they make financial sense
- HELOC Guide 2026: Rates, How It Works & Monthly Payments — Everything you need to know about lines of credit, draw periods, repayment periods, and current market rates
- HEI vs HELOC: Which Is Better for You? — Detailed comparison with real-world scenarios and decision trees
- Best HEI Companies 2026: Full Reviews & Comparisons — Comprehensive breakdown of Splitero, Hometap, Point, Unlock, Unison, and more
- Splitero Review 2026: Detailed Analysis & Real Application Walkthrough — Our hands-on review of Splitero’s platform, pricing, and customer experience
- HEI vs Reverse Mortgage: Which Home Equity Option Is Right for Seniors? — Compare HEIs and reverse mortgages for retirees
Frequently Asked Questions
What is a home equity investment?
A home equity investment is an arrangement where a company provides you with cash upfront in exchange for a percentage of your home’s future appreciation. Unlike a loan, there are no monthly payments, interest, or debt obligation. The company shares in the gains (or sometimes losses) when you sell your home or the investment period ends.
How does an HEI differ from a HELOC?
An HEI requires no monthly payments and shares in your home’s appreciation. A HELOC is a revolving line of credit that requires monthly payments (usually interest-only during the draw period). HELOCs typically have lower total costs if your home appreciates slowly, while HEIs offer more flexibility and lower barriers to qualification.
What credit score do I need for an HEI?
Most HEI companies require a minimum credit score of 500–600. Some (like Splitero) accept 500+ with no income verification, making HEIs accessible to people who might not qualify for traditional HELOCs (which typically require 620+).
Are HEI proceeds taxable?
Generally, HEI proceeds are not taxable because they’re not considered income—they’re an equity arrangement. However, when the investment period ends and the company takes their share of appreciation, that may have tax implications. Consult a tax professional for your specific situation.
What happens if my home loses value?
Most HEI companies have downside protections. Some cap your loss, others absorb losses after a certain period, and some (like Unison) share losses with you. Read the fine print of your agreement carefully. HELOC borrowers aren’t affected by home value changes.
Can I pay off an HEI early?
Most HEI companies allow early payoff without penalties. However, you’ll typically pay the company their percentage of appreciation up to the point of payoff. Verify the early payoff terms with your specific provider before signing.
What states offer HEIs?
HEI availability varies by company. Point has the widest footprint (29 states + DC), while Splitero operates in 14 states (expanding). Hometap covers 17 states + DC. Check with individual companies for current state availability.
How much equity do I need?
Most HEI companies require 20–25% minimum equity. Some accept less. HELOC lenders typically allow you to borrow up to 80–90% of your home’s value minus your mortgage balance. Use our equity estimator tool to calculate yours.
Is an HEI better than a reverse mortgage?
HEIs and reverse mortgages serve different purposes. HEIs are available to younger homeowners and don’t require home sale. Reverse mortgages are for 62+ and let you stay in your home while the lender gets repaid upon sale. See our detailed comparison for your situation.
What are the risks of an HEI?
The primary risk is cost—if your home appreciates significantly, sharing a percentage can be expensive. Other risks include loss of home control if you default, long lock-in periods, and limited state availability. Compare costs carefully against HELOC alternatives.
Can I get an HEI if I’m self-employed?
Yes! HEIs are ideal for self-employed individuals because most don’t require income verification. Traditional HELOCs require 2+ years of tax returns. HEI providers like Splitero focus on home equity and credit score instead, making them much easier to qualify for as a freelancer or business owner.
How long does the HEI process take?
Most HEI applications take 2–4 weeks from start to funding. The process includes: application, property appraisal, title review, and legal documentation. Faster services like Unlock may close in 2 weeks. Slower processes like traditional HELOC applications can take 6–8 weeks.