By Lauren Rosales-Shepard, Content Writer

 It’s impossible not to notice that extreme weather and natural disasters have increased over the past several years. From the <a href="https://www.nytimes.com/2021/02/20/us/texas-winter-storm-explainer.html">historically severe</a> Winter Storm Uri in Texas, which led to unprecedented loss of power across the state for days, to the destructive flooding in Florida following Hurricane Ian, described as “<a href="https://www.theguardian.com/us-news/2022/oct/03/hurricane-ian-death-toll-florida">the second-most-costly</a> storm to ever strike” the state, it’s obvious that something meteorological is afoot.



 That something is, of course, <a href="https://doi.org/10.1007/978-94-017-8598-3_2">climate change</a>.

 Warmer surface temperatures lead to more droughts, but also <a href="https://www.usgs.gov/faqs/how-can-climate-change-affect-natural-disasters">more intense storms</a>. Think of the increased water evaporating into the atmosphere as powerful fuel for storm development. Plus, the escalated temperatures in the ocean and the air cause stronger winds to propel tropical storms–combine that fact with rising sea levels, and you will see more intense and widespread hurricane damage! When those higher temperatures <a href="https://disasterphilanthropy.org/resources/extreme-cold">disrupt the polar vortex</a>, imagine an enormous leak that causes Arctic weather to bleed into traditionally warmer geographies. In short, everything goes haywire–precisely as we have seen.


 We know from watching news reports that any given natural disaster can lead to displacement and loss of life; we know, too, that extreme weather affects <a href="https://climatechange.chicago.gov/climate-impacts/climate-impacts-agriculture-and-food-supply">crops</a>. However, common knowledge tells us much less about the effect that climate change-driven natural disasters and extreme weather have on home values and other housing issues.


 Home Values

 According to a study of hurricanes and housing markets in Florida during the span of 2000-2016, <a href="https://doi.org/10.1016/j.jeem.2022.102770">home prices temporarily increased</a> in the years following a hurricane. The study also found that there was a decrease in home sales during that same subsequent period–usually, about three years. This negative supply shock tended to rebound after that time, perhaps reflecting the ability for homeowners in the affected areas to obtain insurance payments or financial aid from government agencies and repair any incurred damages. As a result, the study describes, the sale prices and buyer incomes return to “baseline” levels–but not below–and so over time, more than 25% of households possess higher incomes than before the hurricane hit. 



 An alternate study that analyzed Hurricane Sandy’s effects on the New York City housing market found that damaged properties did suffer the big, immediate drop in value that one might imagine. Those values did enjoy a partial recovery over time, likely due to repair and restoration, like the homes in Florida described above. However, unlike the previous study, this research <a href="https://doi.org/10.1016/j.jue.2018.06.005">discovered a “price penalty”</a> seemingly suffered by flood zone properties that were not themselves damaged by Sandy at all. The hypothesis: immense news coverage surrounding the storm may have sparked widespread awareness of the risk of flooding in that location, turning people off from purchasing homes there. It’s worth noting that the Florida study did not focus on one extreme storm, so the data were less likely to be affected by the same type of news-led notoriety. In other words, if the area is hit by a more extreme and therefore more ‘famous’ hurricane, home values are more likely to suffer, because more people will know about it.



 A 2018 study reached <a href="https://doi.org/10.1016/j.jfe.2018.09.002">a similar conclusion</a> in its analysis of the 2010 Fourmile-Lefthand Canyon forest fire. At the time, the fire was the most expensive ($217 million in property damages) in Colorado history, drawing attention to the correlation between wildfires, forested areas, and economic loss in the area. Resultantly, sale prices of homes in nearby areas–though unaffected themselves–experienced a 21.7% decline. Conclusion? The area received a well-known reputation as at-risk for especially costly wildfires, and potential homeowners were not keen to take that risk.


 More recently, a 2020 study considers the correlation between natural disasters, regional economic health, and home values. A robust local economy often yields higher home values; the inverse is also true. The study finds that a more diverse local economy–i.e. comprising a plethora of industries, rather than only one–is <a href="https://doi.org/10.1016/j.regsciurbeco.2020.103581">more likely to bounce back</a> from a period of adversity, including natural disasters. Home values, in turn, reflect those shifts. For example, imagine Las Vegas. The area relies very heavily on tourism–expensive tourism. Therefore, when something like the Great Financial Crisis of 2008 happens, or the COVID-19 pandemic, and people don’t take expensive vacations, Las Vegas tends to suffer enormous economic loss. During these periods, the home values also suffered a dramatic drop. The study found that the same holds true for communities impacted by hurricanes and other natural disasters; in those with more than one thriving industry, home values suffered far less. 
 

 It might not come as a surprise, but belief in climate change also affects home values/prices. A concept called “homophily” refers to a preference for owning a home in a neighborhood where the other inhabitants are similar to oneself. You can probably see where this is going; if there is a strong desire to live in a neighborhood where your neighbors have the same political signs in their front yards, it’s pretty likely that you and those neighbors are going to have identical opinions on whether or not climate change is real. A 2020 study finds that in neighborhoods where the majority believe in climate change, if those neighborhoods are projected to be underwater in future due to rising sea levels, there is <a href="https://doi.org/10.1093/rfs/hhz073">a 7% drop in home prices</a>. Logically, it follows that in neighborhoods that maintain climate change denial, the home prices likely remain unaffected. The Scientific American suggested last month that either denying or, at least, ignoring climate change and its associated risks has <a href="https://www.scientificamerican.com/article/ignoring-climate-risks-has-inflated-property-values-in-flood-zones/">inflated the property values in various flood zones</a>–by over 40% in some areas! 



 Demographic Shifts
 The extreme weather and natural disasters resulting from climate change <a href="https://doi.org/10.1016/j.gloenvcha.2021.102329">do not affect everyone equally</a>. Perhaps it’s common sense, but studies, too, show that those with lower incomes are more often unable to recover when natural disasters strike their communities. Underrepresented and otherwise marginalized groups do not have access to prevention and mitigation measures, not to mention timely recovery efforts, or financial resources to help them rebuild. 

 A 2022 study analyzes the homeowner response in areas affected by Hurricane Andrew in 1992, and finds that the “<a href="https://doi.org/10.4337/9781035301614.00030">economic capacity to adjust</a>” seems to rule the results. After Andrew, the most financially vulnerable tended to move into low-rent housing in the hardest-hit areas, as it was all that they could afford. Middle-income households frequently abandoned the area entirely, choosing to relocate to somewhere with less risk association. On the other hand, the wealthy most often opted to remain, due to their ability to afford increased insurance protection, costly repairs, and future protection. 
 

 An earlier 2012 study of the housing aftermath of Hurricane Andrew finds, too, that the powerful storm led to <a href="https://doi.org/10.1068/b37121">widespread property abandonment and vacancy</a>. This result was most prevalent in neighborhoods and communities that were already in decline when Andrew hit, and the study shows that abandoned properties tend to have a “spillover effect” that, in the long term, leads to increased vacancy in the surrounding areas. Though a decade apart, these two studies of the same hurricane reach the same conclusion: low income households and communities who are affected by natural disasters are least likely to recover–ever–from those events. In fact, with the increasing occurrence of extreme weather that is triggered by climate change, it’s highly probable that these vulnerable populations will find themselves in consistently worsening circumstances due to both the likelihood of repeating hurricanes and their increasing inability to afford to move away from the area.


 There is an <a href="https://www.tandfonline.com/doi/full/10.1080/10527001.2020.1838172">uptick in missed mortgage payments</a> after a natural disaster hits, a 2020 study finds. Such data may not be surprising; after all, the sudden onslaught of pricey and necessary repairs could throw virtually anyone’s monthly budget out of whack. However, the study also finds that many of these mortgage delinquencies lead to foreclosure–in other words, one missed payment evolves into too many, until there is no possible rebound. The primary residence is <a href="https://www.nahb.org/blog/2021/02/homeownership-remains-primary-driver-of-household-wealth/">the largest financial asset</a> among the majority of home-owning households, so what happens when these families lose their homes? The study postulates that pre-existing inequalities in these communities are only further widened, reflecting the long-term, big-picture damage that extreme weather events can have in affected areas. 



 Conclusion 

 The insurance industry is <a href="https://heinonline.org/HOL/LandingPage?handle=hein.journals/davlr54&div=17&id=&page=">increasingly reluctant</a> to take on homes that are at high risk for wildfire, flood, or earthquake, leaving an alarming amount of households without a natural catastrophe safety net. Don’t let that be you! If you are looking to buy a house in a potentially impacted area, don’t hesitate to <a href="https://www2.unison.com/blog/climate_change/">think ahead</a> about the effects of climate change. Make sure you ask inspectors to look for evidence of previous flood or fire damage, and budget for future complications and damage. And don’t underestimate the effect of extreme heat, either–some homeowners in desert locales have <a href="https://www.wsj.com/articles/homes-designed-for-extreme-heat-4a60426a?mod=djemRealEstate_h">preemptively combatted future excessive summer temperatures</a> with features like solar panels and heat-reflecting roofs, for example. 

 The future may be nebulous, but the best defense is to be informed, knowledgeable, and prepared. 



 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

kelly-sikkema- whs7FPfkwQ-unsplash

When we see natural disasters on the news, we see numbers–property damages, loss of life, displaced peoples. What are the long-term effects on home values and demographics, though? 

Climate Change, Natural Disasters, & Home Values: an Overview

By Lauren Rosales-Shepard, Content Writer

 For years you’ve heard that real estate is one of the <a href="https://www.cnbc.com/2019/10/01/real-estate-is-still-the-best-investment-you-can-make-today-millionaires-say.html">best investments</a> you can make. It’s considered something of a safe bet; unlike the literal dollar, real estate doesn’t lose value to inflation over time. Plus, real estate investing is a tax savvy way to diversify your portfolio, as there are many write-offs available to you, as well as other benefits. And don’t forget the largely passive income boost! Where do I sign up?



 But, when you wake up on Saturday morning, you are dismayed to discover that it has snowed. A lot. It’s 20 degrees outside and windy–so, it “feels like” 6. You have never wanted to do anything less than abandon your fuzzy robe and find your thick, unfashionably practical winter gloves to proceed outside into the arctic abyss, armed (only) with a shovel. For a moment, you sit on the edge of your bed and wonder, “What would happen if I just didn’t do it?”


 It is a truth universally acknowledged that nobody wants to shovel their sidewalks. Nor do they desire to climb a slick ladder up to their roof, or spray tacky-looking foam from an aerosol ‘round the pipes leading from the washing machine to a mysterious outdoor location. Yet, as homeowners, these are tasks that we can’t pass off to obliging landlords–and, yes, we really do need to do them. As partners to our homeowners who want them to always win, we've looked into the WHY of winter maintenance, and collected a few tips along the way! 

 Spray Foam, Pipes, and Crevices

 Let’s tackle the unattractive foam first. Spray foam is composed of <a href="https://heartlandinspections.com/can-you-use-spray-foam-around-hot-water-pipes/">polyurethane and a catalyst</a>, the latter of which causes the foam to rapidly expand when it is sprayed on an area. That expansion is what makes it ideal for filling cracks, gaps, and crevices, as well as encompassing pipes as an additional warming layer. You can find the sprayable foam at any hardware store; in fact, there tends to be such a surplus of varieties that you will need to double-check that you’ve chosen the right one for your particular project. A couple of things to remember: firstly, clean the area before you spray, because dust and other contaminants could interfere with the chemical process that expedites the foaming; secondly, you really do need to generously and enthusiastically shake the can for a full minute before starting to spray, in order to get that chemical process going! 

 True, it’s not the most scenic addition. But, consider the benefits! Insulated pipes are less likely to freeze, or to produce condensation that can cause other problems. When you prevent cold air from entering the house through cracks, you not only keep your space warmer, but you can save money on your energy bills. A spray foamed seal is <a href="https://www.usiinc.com/blog/spray-foam-insulation/advantages-spray-foam-insulation">as much as 24 times less permeable</a> to outside air–now, translate that into dollars per month! If you’ve been noticing a winter surge in your energy bills, you may want to explore this option.



 Ice Dams and Roof Maintenance
 Spraying foam from an aerosol can is unquestionably easier than trying to perform roof maintenance in the dead of winter. However, it might be necessary to do it if your area experiences heavy snowfall or an ice storm. 

 

 First thing’s first: always remember to clean out your gutters before fall morphs into winter. If you don’t, the crispy leaves, abandoned acorns, and other autumnal detritus will be <a href="https://www.houzz.com/magazine/your-winter-home-maintenance-checklist-stsetivw-vs~55572864">perfectly positioned to cause water backups</a> when snow or freezing rain fall, leading to leaks, ice dams, and other damage to the roof and siding. Although your roof may still need urgent attention in the winter, taking this action preemptively will ensure it is much less likely! If you live in a region that regularly receives heavy snowfall, you might also consider installing heated cables (again, before winter hits!) that you can simply switch on to melt snow and ice after each storm. 



 But, let’s say that you either forgot to take preventative measures, or you just have bad luck. You’ve noticed that icicles, though rather picturesque, have unfortunately begun to form <a href="https://www.heatizon.com/blog/blogroll/roof-deicing-ice-melt/5-signs-you-have-an-ice-dam">along the gutter edge</a>. Those gutters don’t seem to be draining, either. These are signs of an ice dam, and you will need to take action quickly! However, don’t take to your ladder with a hammer, chisel, or mallet and start using brute force against the ice; you are fairly likely to do even more damage to your shingles. Instead, you can employ a long-handled roof rake from the safety of the ground. The rake can remove snow build-up, and the friction from a wheeled rake in particular can alter the temperature enough for the ice to melt. (Protip: using a roof rake after a heavy snowfall is also a good idea in general). 



 A less conventional method to dealing with ice dams involves–of all things–pantyhose! If you fill <a href="https://www.thisoldhouse.com/roofing/21017660/how-to-get-rid-of-ice-dams">one leg of pantyhose with calcium chloride ice melter</a> and then lay it onto the roof so that it crosses the ice dam and hangs over the gutter, the melter will get to work and conveniently carve a channel from which water can flow off the roof. Voila! 



 Shoveling 

 Very few people enjoy the manual labor of shoveling their driveway and the sidewalks in front of their house. Here’s the thing: it really needs to be done. 

 To start, let’s look at this from a legal standpoint. <a href="https://www.rentecdirect.com/blog/the-complete-guide-to-snow-removal-laws-by-state">Each state</a> (and sometimes city) has different laws about the need to shovel your sidewalk, as well as requirements regarding how quickly. In Omaha, Nebraska, homeowners (or tenants, as the case may be) have 24 hours to clear snow, or they will face a hefty fine. Just how hefty? One man faced <a href="https://www.wowt.com/content/news/Landlord-shocked-by-high-fine-after-snow-wasnt-cleared-at-property-508299221.html">a $1,600 fine</a>. At the very least, most of us are legally obligated, by city ordinance, to shovel sidewalks swiftly. 



 However, if you live in one of the states that does not have a law in place (Alabama, for example), if someone is injured in an accident that occurs on your property as a direct result of snow or ice that has been neglected, you could certainly find yourself <a href="https://www.heslinlawfirm.com/blog/importance-of-shoveling-your-sidewalk.cfm">being sued</a>. It’s also basic, neighborly etiquette. 

 When it comes to your driveway, you are unlikely to sue yourself if you slip and fall. However, it is still prudent to remove the possibility, for the sake of avoiding bruises or even more serious injuries. In addition, if the snow melts and then freezes into ice, it <a href="https://sbclandscaping.com/what-happens-if-you-dont-remove-the-snow-from-driveway/">may start to crack</a> your driveway. Then water will seep into those cracks over time, freezing and expanding, and the driveway will need expensive repair. Plus, if you continue to park and repark your car in a snowy driveway, the constant moisture might <a href="https://www.ehow.com/info_12038792_dangers-not-shoveling-driveway.html">begin to rust</a> the underbelly of your vehicle. 

 So, you should definitely shovel the sidewalk and the driveway. That said, it is important to do so carefully. If you aren’t usually an active person, suddenly undertaking this level of manual labor might be tough on your muscles, joints, and even your heart. The cold also increases the chance of experiencing <a href="https://www.nsc.org/community-safety/safety-topics/seasonal-safety/winter-safety/snow-shoveling">a blood clot</a>. It’s a good idea to stretch before shoveling, and to take it slowly. Don’t forget to push the snow more than lifting it; if you do need to lift some at times, be sure to do so with your legs and not your back! It may also be best to shovel in shifts, rather than all at once.


 Ultimately, it is worth it to postpone the crime novel and the second pot of coffee to take care of post-snow maintenance on and around your house. Be careful, and stay warm! 



 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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We know there’s certain stuff we’re supposed to do to take care of our homes during the snowy season. But what would happen if we just… let it slide? 

The Woes of Winter Maintenance 

By Lauren Rosales-Shepard, Content Writer

 For years you’ve heard that real estate is one of the <a href="https://www.cnbc.com/2019/10/01/real-estate-is-still-the-best-investment-you-can-make-today-millionaires-say.html">best investments</a> you can make. It’s considered something of a safe bet; unlike the literal dollar, real estate <a href="https://www.forbes.com/sites/forbesrealestatecouncil/2021/02/17/eight-reasons-you-should-consider-real-estate-investing/?sh=1f02cd075c51">doesn’t lose value to inflation</a> over time. Plus, real estate investing is a tax savvy way to diversify your portfolio, as there are <a href="https://www.rocketmortgage.com/learn/tax-benefits-of-real-estate-investing">many write-offs</a> available to you, as well as other benefits. And don’t forget the largely passive income boost! Where do I sign up?



 However, there are many ways to invest in real estate. You could buy a house or a condo, and rent it on a yearly lease. You could also rent a whole house or individual unit as an AirBnb or other short-term rental. That said, there are other ways to invest in real estate without becoming a landlord or host of any kind! Let’s take a closer look at each of these possibilities to get a better idea of what might work best for you.

 REITs
 Perhaps you’re thinking, “Owning my own home is stressful enough!” If you don’t want the added responsibility of being accountable for the functionality of somebody else’s living space–or the anxiety of finding a tenant who will treat that space kindly–then you may want to eschew purchasing an investment property altogether. However, you can still invest in real estate by purchasing shares of a real estate investment trust (<a href="https://www.bankrate.com/investing/reit/">REIT</a>). REITs are companies that own, finance, or manage various properties; they pay the majority (90%) of the rental (or other) income out to the investors who finance them. 

 With an REIT, you benefit from capital appreciation and <a href="https://www.investopedia.com/terms/r/reit.asp">receive dividends</a>. (Note, however, that those generous dividends are in fact taxed as <a href="https://www.investopedia.com/terms/o/ordinaryincome.asp">ordinary income</a>). And in addition, because a single REIT has a large variety of properties in its portfolio, your shares are automatically <a href="https://www.thebalancemoney.com/advantage-of-real-estate-investment-trusts-2867051">diversified</a>. That diversification cuts down on the risk, as it spreads your figurative financial eggs into many, many baskets. However, REITs tend to perform poorly <a href="https://www.investopedia.com/articles/investing/031915/what-are-risks-reits.asp">when interest rates are high</a>, and can sometimes be at the mercy of real estate trends over which you can have no control. (Consider the <a href="https://www.businessinsider.com/american-mall-decline-150-left-10-years-how-many-2022-10">increasingly defunct</a> suburban shopping malls, for example). 
 

 While purchasing shares in an REIT doesn’t come with the responsibilities of being a landlord, there are still risks and potential pitfalls. 



 Renting Out an Investment Property
 Let’s say that you aren’t at all discomfited by the idea of taking on additional landlord responsibilities. Perhaps your family has outgrown your current home, and you think it might be worthwhile to rent it out after you move, rather than sell it. If you don’t relocate to another locale, you can keep an eye on the property and be fairly available to your tenant. Or, you might have your eye on a particular property–say, a condo in the increasingly trendy downtown area, or a duplex near the local university. What are the benefits of such an arrangement?

 

 You could see a return on investment (<a href="https://www.rocketmortgage.com/learn/roi-real-estate">ROI</a>). Think about it; over time, the rents you collect can pay off the mortgage and account for any maintenance costs. Once you’ve paid that mortgage, those monthly rents go straight into your bank account, saved for a rainy day. That’s the obvious perk. There are also <a href="https://www.investopedia.com/articles/investing/051515/pros-cons-owning-rental-property.asp">some tax benefits</a>, like the ability to deduct your insurance, mortgage interest, maintenance costs, and other ordinary and necessary experiences. 



 However, leasing a property to a tenant has some inherent risks involved. Despite the careful language you may place in the lease, there’s no guarantee that a tenant is not going to be destructive or irresponsible. You might require them to put down a security deposit; however, if they don’t pay their rent on time, chain smoke in the living room, and have a secret cat who destroys the carpets, that probably won’t be much consolation. 



 It’s also important to note that a rental property is not a liquid asset. In other words, you can’t just cash it in, on the spot, if you need money. It can take months to sell a property–plus, you’ll incur taxes on the profit!--and you can’t eject a tenant before their lease expires just because you have a sudden expense. You may also experience difficulties with unexpectedly rising taxes and insurance premiums, or a swift shift in neighborhood desirability, that makes the asset much less lucrative. 



 Don’t forget, too, that you may find yourself driving across the city at two o’clock in the morning to deal with a heater that stopped working. If you hire a property manager, it can save you such headaches; however, that convenience can cost you <a href="https://www.rockethomes.com/blog/home-selling/should-rent-out-first-home">between 8-12%</a> of the monthly rent. 


 "AirBnbing It"

 While renting a unit or a house on a yearly lease will grant you regular income, converting a space into a vacation or temporary rental–for listing on apps like AirBnb or Vrbo–is increasingly popular. In 2021, worldwide revenue for vacation home rentals totalled <a href="https://www.statista.com/outlook/mmo/travel-tourism/vacation-rentals/worldwide#revenue">a staggering $57.94 billion</a>! Though AirBnb (and Vrbo, for that matter) charges <a href="https://www.igms.com/airbnb-service-fee/">a service fee</a>, the platform takes care of payments, and markets the property. And you wouldn’t be a landlord per se, so much as a host–you can take however many bookings as you want, instead of being on call 24/7 for a tenant. 
 

 There is also more flexibility in short-term vacation rentals. While a lease locks a tenant into a specific monthly rent for an entire year, you have the ability to change your prices for an AirBnb based on a variety of factors. Friday and Saturday nights, for example, might be listed as a higher rental price; summer months could cost more than the dead-of-winter (unless your property is near fabulous skiing, of course). 



 Although selecting a responsible long-term tenant can be tricky, you take that risk hundredfold when you imagine how many renters with whom you might contract via AirBnb. Unless you especially wish to go this route, you might run into trouble with those seeking a so-called 
<a href="https://www.texasmonthly.com/news-politics/inside-bro-tastic-party-airbnb-gentrifying-east-austin/">“party house.”</a> If that happens, you will be responsible for getting the space spick and span again–including replacing any broken furniture!--in time for your next rental. 


 Speaking of furniture, a considerable added cost to running a short-term rental is the need to furnish and stock the space. Since one of the major perks for many vacationers to renting a home or apartment unit is the use of a kitchen, you will need to remember to include basic dining and cooking implements, as well as pantry ingredients. A long-term tenant will bring her own furniture and buy her own toilet paper; you will have to purchase the entirety of both for an AirBnb. And since the competition can be pretty high, you won’t want to skimp, either. Attractive rooms and luxurious furnishings are increasingly the mainstay of short-term rentals. Haven’t you ever searched for an AirBnb that specifically had a hot tub? 


 If you want to list a short-term rental, you will need to diligently look into your city’s laws and regulations. Some may not allow them, and others will require a permit–and if you see fit to skip the latter, you may be looking at an enormous fine. In many cities, AirBnbs are seen as a <a href="https://www.vice.com/en/article/vbx588/airbnbs-gentrification-problem-podcast">vanguard of gentrification</a> and propagator of <a href="https://www.kvue.com/article/money/economy/boomtown-2040/airbnb-austin-housing-issues/269-53065189-c1f7-46e9-85d1-1a897375dfb5">affordable housing shortages</a>; therefore, cities from <a href="https://www.nytimes.com/2022/07/12/nyregion/airbnb-lawsuit-short-term-rental.html">New York City</a> to <a href="https://www.dallasnews.com/news/2023/02/17/plano-has-a-short-term-rental-problem-heres-what-arlington-did-to-solve-the-same-issue/">Plano, TX</a>, and <a href="https://www.wwno.org/2023-01-27/planning-commission-endorses-block-caps-for-new-orleans-short-term-rentals">New Orleans</a> to <a href="https://www.wcax.com/2022/12/12/morristown-cracks-down-short-term-rentals-fight-housing-crisis/">Morristown, VT</a> are combatting the prevalence of short-term rentals in their vicinities. With the situation in flux, it may not be an ideal time to dip one’s toe in the water, so to speak.


 If you’re considering a real estate investment of any kind, you’ll want to go above and beyond doing your due diligence. Like many things in life, there is no one-size-fits-all model for real estate investment. Obviously, any type of large investment is a huge decision which necessitates a gargantuan amount of research. Whatever investment pathway you pursue, a <a href="https://unison.com">Unison</a> equity sharing agreement may help secure the starting capital you need to diversify your portfolio. 



 
Our equity sharing agreements are designed to empower homeowners like you to live the life they’ve always wanted, by giving them a liquid slice of your home equity in exchange for a percentage of your home’s future change in value. Unlike a HELOC or home equity loan, we don’t require monthly payments or charge interest–that means no added debt! Unison does have an owner-occupancy requirement,so if you are interested in liberating the equity in your home to fund an investment opportunity, know in advance that you will need to occupy that home at least 180 days out of every 365-day period and must never be away for 60 consecutive days.

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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If you’re thinking about getting an investment property, you might be wondering whether it’s best to rent it outright, list it on AirBnb, or entertain an entirely different option. Let’s look into each and weigh the pros and cons. 

Is AirBnB Better Than Traditional Renting?: Investing in Real Estate

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<h4>Submit Your Application</h4>
 

<img width="100%" src="//contentimages.o-prod.unison.com/images/blog/submit_application.png">

 
Once you’re pre-approved, you can easily submit your complete application through our online portal. If you have further questions, want to learn more, or just need assistance with your application, our team is ready to help.
 

<h4>Upload Your Documents</h4>
 

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You make no payments to Unison, but we review your debt and income to ensure you can meet the carrying costs of our mutual investment, your home. You can securely upload key documents for review and validation by using our online portal. We provide a list of documents unique to your income and ownership situation. It’s easy to use and accessible at any time to update your documents.
 

<h4>Complete An Appraisal</h4>
 

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Once your document upload is completed and reviewed, the final step to receiving an offer is to have your property professionally appraised. Sometimes, a property inspection (which focuses more on the property's condition) is also required – we'll let you know if that's the case. If you’ve just purchased your home or had an appraisal done recently, it may not be necessary to schedule another!
 

<h4>Receive Your Offer</h4>
 

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Once your application has been approved and your checklist is complete, we’ll submit your final offer letter and closing package. Review to ensure everything meets your expectations. After you sign your offer letter, we then will schedule a closing with you to sign with a notary and you can receive your funds in as little as three days!
 
All said and done, the typical Unison equity sharing agreement goes from pre-approval to offer in just about 30 days, often depending on the appraisal step of the process. It’s a quick and easy way to get back your down payment, pay down costly debt, or fund an important purchase, without signing up for more monthly payments or accruing more interest.
 
We win, when you win – consider an equity sharing agreement from Unison to convert your home’s equity into cash. Give us a call today to learn more about how we can help you.


The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Find out how to apply to a Unison Equity Sharing Agreement

Applying for a Unison Equity Sharing Agreement

Ready to bring our partnership to an end? There are four ways in which your Unison greement can come to a close.
 
<h4>Sell your home</h4>
 

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You’re allowed to sell your home, which ends your Unison agreement, at any time. Keep in mind that if you sell your home before the 5-year milestone, Unison does not share in any decline in value. 
When your home sells, the amount owed to Unison will be based on the Ending Agreed Value of your home - typically determined by the open market sale price. This does not include any closing costs, seller concessions, taxes, or other expenses incurred while selling the home.
 

<h4>Special Termination</h4>
 

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At any time, you can choose to Special Terminate, or buy out of, the agreement without selling your home. In this case, we will use a third-party appraisal to establish the Ending Agreed Value. The process is similar to selling your home, except we will use the appraised value instead of a sale price - since you’re not selling. The main difference with a Special Termination is that Unison does not share in any decrease of value. This means that the Ending Agreed Value for your property will be at least equal to the Original Appraised Property Value, even if your property value has decreased since the start of your agreement. Thus, at a minimum, you’ll have to pay the Initial Payment (together with any amounts attributed to the Risk Adjustment).
 

<h4>After 30 years</h4>
 

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If 30 years have passed, and you haven’t otherwise ended the agreement, you’ll have two options for terminating the agreement at the 30-year mark. You can Special Terminate (buy out) or sell your home. Since our interests are aligned in either case, we will always try to work with you to help you receive as much value from your home as possible.
 

<h4>The last signatory passes away</h4>
 

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In the case that everyone on the agreement has passed away, Unison will work with the estate or heirs to conclude the agreement, by either selling the property or paying Unison the value of our interest in the home. It’s important to discuss your Unison agreement with members of your family who may be impacted, as well as anyone living in the house who is not a signatory to the agreement, as they may not be able to remain in the house in the event that the home is sold.
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Ready to bring our partnership to an end? There are four ways in which your Unison Agreement can come to a close.

Ending Your Unison Agreement | Unison® Home Equity Sharing

Unison home equity sharing agreements are best-suited to long-term use cases, allowing you to make your house a home, create lifelong memories, and accrue a healthy appreciation in your home’s value.
 
Once you’ve partnered with Unison and funded your goals, it’s time to get comfortable. Let’s break down some key milestones and important elements of the agreement to keep in mind.
 
<h4>Early Days</h4>
 

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Because a Unison agreement is intended for long-term situations, several perks of partnering with Unison will kick in after a few years have passed. 
You’ll become eligible to apply for a Remodeling Adjustment after three years have passed, a major benefit that allows you to keep the increase in home value that results from any home improvements you make while partnering with Unison. However, it cannot be applied if you sell your home before three years have passed, and it is based on how much value was added to your home - not the costs of the projects. 
You are always allowed to sell at any time since your home belongs to you, and you alone. If you decide to sell your home before the fifth anniversary of our partnership, then Unison will not share in any decline in the value of your home. This means that the Ending Agreed Value for your property will be at least equal to the Original Appraised Property Value, even if your property value has decreased since the start of your agreement. Thus, at a minimum, you’ll have to pay the original investment (together with any amounts attributed to the Risk Adjustment).
 

<h4>The 5-Year Milestone</h4>
 

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Once our partnership has reached five years, you unlock a significant amount of flexibility. Once your restriction period is up, we’ll share in any gain or loss in value if you do decide to sell your home. You are also able to buy Unison out at any time without selling your home, but Unison will not share in any decrease of value. And there’s no need to change anything if you’re happy at home! You and your family can keep the good times rolling, allowing your home to increase in value over time. To ensure we both win, there are a few straightforward rules to keep in mind: 
<ul>
<li>Keep your home as your primary residence.</li>
<li>Keep your home in good repair.</li>
<li>Maintain proper insurance.</li>
<li>Keep payments current.</li>
<li>Allow aerial photography of your home.</li>
<li>Keep us informed of any major changes.</li>
</ul>
 

<h4>Refinancing & Maximum Authorized Debt</h4>
 

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While working with Unison, it’s possible you’ll decide to pursue a secondary home loan or refinance your existing mortgage. In this case, your mortgage and new secondary home loan combined can’t exceed your Maximum Authorized Debt Limit — a limit on the total amount of debt secured by your house. 
There are, however, certain types of loans that we typically don’t allow — reverse mortgages, interest-only loans, shared appreciation loans, or any loan with a negative amortization feature. Also, if your home has declined in value since your agreement with us, we may not be able to approve any cash out loans that are above your current mortgage amount. 
If you plan on refinancing your home, you should consider doing so before entering an agreement with Unison. Some lenders will decline to provide new loans to you if you have received subordinate financing from Unison.

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Understand your home equity sharing agreement with Unison

During the Home Equity Sharing Agreement

Congratulations! Once you’ve accepted your offer and received your funds, it’s time to start planning your next big move – from paying down debt to supplementing your retirement income and beyond.
 
And once those funds are received, they are yours to spend or invest as you see fit. From paying down aggressive, overwhelming debts, to starting a new business with no loans required, or elevating the comfort of your retirement, your capital is yours to put to work! Here are some of the most common use cases for individuals and families who receive Unison equity sharing agreements:
 

<h4>Fund Your Retirement</h4>
 

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Retirement is a major milestone. While many celebrate this time in life, it can also be a stressful occasion if your savings alone cannot accommodate your accustomed standard of living. The additional income provided by a Unison equity sharing agreement could empower you to settle into this stage of life with security, financial freedom, and the ability to truly live out your dreams.
 

<h4>Remodeling with Unison</h4>
 

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With Unison, you can fund the renovations you’ve been dreaming of! More and more families are seeking to modify, expand, and improve their home – their way. Older homeowners can take advantage of “equity rich, cash poor” situations by using a Unison equity sharing agreement to make needed renovations to ensure their safety or transition to single story living, while keeping their best investment looking its best. Whatever the situation, home improvements are often a perfect investment, boosting the value of your home while increasing its livability for you, every day. Plus, after just three years of being in a Unison agreement, you’ll be eligible to apply for a remodeling adjustment.
 

<h4>Paying Off Debt With Unison</h4>
 

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Between the overwhelming amount of monthly payments and the seemingly never-ending amount of interest accruing, debt can be a massive source of stress. For homeowners, it can be a difficult decision to part with even just a portion of the value of your home, but when facing significant debt, it can be a wise decision. Whether you’re faced with medical debt, student loans, or mounting credit card debt, being able to wipe the slate clean can be a huge relief – and with the amount saved on monthly interest payments, you’ll be the master of your own pocketbook once again.
 

<h4>Fund A Purchase With Unison</h4>
 

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To quote ourselves from earlier – “your capital is yours to put to work”. Whether that means funding the trip of a lifetime, purchasing a summer home, or getting the keys to your dream car – we’re here to help you bring your bucket list to life. Alternatively, If you’ve identified a sound investment, Unison can help you jump on the opportunity before it’s gone, without needing to take out a loan.
 

<h4>Starting A Business With Unison</h4>
 

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One of the biggest hurdles to starting a business is acquiring a loan or outside investment. An equity sharing agreement with no monthly payments can eliminate stress, allow you to focus on running your business, and ensure that you’ll never have to compromise on your vision. Many of our homeowners have sought out a career change in recent years, and starting a successful business can pay off in a major way.

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Receiving Your Funds

Welcome to Unison, Together You Can.
 Home equity sharing is based on a straightforward yet radical idea: with a partner in home ownership, you can go further than you can go alone.
 
Welcome to Unison, the world’s first home equity sharing company. So what is home equity sharing? In short, it’s a smarter and better way to buy and own your home. One that results in less debt and more control for everyday people like you and me.
<img src="https://contentimages.o-prod.unison.com/images/blog/couple_on_patio.png">

What is home equity sharing?
 Home equity sharing allows you to access financial freedom and flexibility by leveraging the future equity your home will create. In plain English, we measure the likelihood of a home to appreciate over time. If your home is predicted to go up in value and meets our other investment criteria, we will invest in it with you. We will give you up to 17.5% of the total value on your existing home. This is not a loan and there is no monthly payment. You can pay us back at any time for up to 30 years. Then, when you sell your home, we take a percentage of the increase of its value. And if the home value goes down, we share in the loss up to the amount of our original investment, unless you sell within the first five years.
 
Why do we need it?
 Today, the cost of housing is growing faster than wages. The result is that more Americans than ever before either feel locked out of buying their dream home or forever trapped in the expression, ‘house rich, cash poor,’ and unable to live the lives they want. So, whether it’s sending your kids to the best college, buying a home in a better neighborhood, getting out from under medical debt or renovating your home, Unison allows you to unlock the future equity your home will create in the future to live your dream life today.
 
Just as collaborative consumption leaders like Uber and Airbnb disrupted transportation and hospitality, so, too, does Unison strive to leverage our homeowner partnerships to create an entirely new home equity sharing category. Our primary goal: to meet the growing needs of the homeowner, and establish a model where you don’t have to rely on debt-only solutions or impersonal banks, but can instead partner with a company who is truly in it with you. When you win, we win.
 
That is why we are proud to live by the phrase “Together, You Can.” It is a simple but poignant expression to help people understand that there is a new way to think about owning their home and living their lives. Together, you can own the home you really want. Together, you can find the money in your house to rebuild, pay bills or use for other things. Together, you can live your dreams.
 
Together, You Can.

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Understand what home equity sharing is and how Unison can help you.

Find out what Unison does | Unison Home Equity Sharing | Blog

HomeOwner Agreements are structured as Option Contracts. This is the legal framework that allows us to give you long-term cash without monthly payments or interest. An option contract gives the buyer of the option the right to buy a specific asset at a later date at an agreed upon price. In short, Unison makes its Initial Payment to you in exchange for the option to buy a portion of your property in the future at a price that we agree on up front. But we have no desire to co-own your home. We can exercise our option only when our Agreement ends, and solely for the purpose of terminating the relationship and settling the obligation you have to Unison. 

Most of our educational materials use a simplified method to calculate Unison's payment when the Agreement ends. The option math works a little differently, but note that both calculation methods will always produce the same results. The example below illustrates this by comparing the simplified math to the option math. 


<a href="https://contentimages.o-prod.unison.com/images/pkr/option_math_jan_2023.png"><img src="https://contentimages.o-prod.unison.com/images/pkr/option_math_jan_2023.png" border="0" alt="Click to enlarge" />
 Click to enlarge image.</a>
 

<h2 class="headline headline--medium">Breakdown: Option Contract Scenario</h2>

At the beginning, Unison purchases an option to buy 40% of your home, which is worth $400,000, in two payments – one now, at $40,000, and one at future exercise, at $116,000. In the future, you sell your home for $490,000. 

A title company will typically handle the finances for you, and will process several transactions simultaneously. In one of those transactions, Unison will exercise its option to purchase 40% of your home by paying the title company the second installment payment of $116,000. In another transaction, they will pay us our “share” in the sale of the home (40% of $490,000, equaling $196,000). But, since the transactions are simultaneous, they simply deduct one from the other: $196,000 – $116,000 = where we arrive at one payment to Unison of $80,000. 

Note: The net return to Unison at the end of our agreement together is the same as the simplified, non-option math that shows accessing $40,000 from a home that increases in value from $390,000 to $490,000 will result in a net payment to Unison of $80,000 at sale. 

So, the option math is more complicated, but the title company will manage that part. If you focus on the simple math from before, it will do the same job of keeping you on the right page. 

Remember: You decide when the option contract ends. Unison cannot exercise our option until you make the decision to buy us out early, sell your home, reach the 30 year max term, or if you materially default on your mortgage. Read more about the different ways that our agreement ends later in the section Ending Your Unison HomeOwner Agreement. 

 

<h2 class="headline headline--medium">Some Situations</h2>

The Option Contract means we have incentives to work with you through difficult circumstances (foreclosure, damage to the house, etc). Because we want your home to be worth as much as possible (just like you do), we can wait until circumstances have improved and you’re ready to sell. This makes the relationship set up by the option contract different, but in a good way. 

<h2 class="headline headline--small">Option exercise and Orderly Sale</h2>

Unison can choose to offer the homeowner a remedy of Orderly Sale in lieu of the foreclosure proceeding, by offering to cure the circumstance of default. The homeowner will have the right to accept or reject this offer. Should the homeowner accept the offer, Unison will make one or more Protective Advances to cure the homeowner’s default, and the homeowner will give Unison the right to market and sell the property in an orderly sale in the customary manner in its local market. Option Exercise and Orderly Sale is designed to prevent the home from becoming a “distressed” property and going to foreclosure, which preserves the market value of the property, and the value of both the homeowner’s and Unison’s equity interest in the property. Following the Orderly Sale, the homeowner and Unison will share the proceeds according to the provisions of the Unison HomeOwner Agreement. 

<h2 class="headline headline--small">Deferred Maintenance Adjustments</h2>

We trust you’ll take care of your home – but in the event you don’t? 


Prior to signing an Agreement with Unison, we typically require a home inspection. While many inspections don’t reveal anything new (maybe a lost sock?), they sometimes uncover defects or conditions that can affect the property value if not addressed. For example, an inspection might reveal significant rot in the framing under the home’s main living area. An issue like this may worsen over time, thus negatively impacting the property’s future value and desirability. 

If a significant issue(s) is found during the inspection, Unison may make note of it in a Deferred Maintenance Addendum. Ideally, the homeowner will arrange for the necessary repairs to be made. However, if the homeowner doesn’t, Unison reserves the right to treat the issue as a Deferred Maintenance Adjustment scenario in the future. Note: You will always be notified if this Addendum is part of your original Agreement. 

<h2 class="headline headline--small">Special Termination</h2>
At any time during your agreement, you can choose to terminate your relationship with Unison. An appraisal will take place, and you'll be responsible for the initial amount given to you by Unison, as well as the Investor Percentage (our share of the change in value) of any increase in value as determined by that appraisal. Also, Unison does not share in any downside in the case of a Special Termination.
 

 

<h2 class="headline headline--medium">Our consumer contract set</h2>

To do a deep dive into the HomeOwner Agreement itself, we recommend you give it a read. Your Program Specialist will be happy to provide you with a copy of any of the below prior to closing your deal. Here is a summary of each contract that comprises the HomeOwner Agreement: 

<h2 class="headline headline--small">Option Agreement</h2>

This contains the basic financial terms of the Unison HomeOwner Agreement and describes in further detail how this particular Option Contract works. 

<h2 class="headline headline--small">Covenant Agreement</h2>

This outlines your rights and responsibilities under the Unison HomeOwner Agreement, as well as the various ways the Agreement can come to an end. It also documents the legal protections available to both you and Unison. 

<h2 class="headline headline--small">Security Instrument</h2>

This document creates a secured lien on the home during the term with Unison and says the lien will be recorded in the jurisdiction where the property is located. It also discusses the fact that the Security Instrument is typically subordinated to any existing mortgage on your property. 

<h2 class="headline headline--small">Memorandum</h2>

This document highlights specific features of the Agreement for public notice and is also recorded on the property. 

 

<h2 class="headline headline--medium">Fees</h2>

There is a one-time transaction fee equaling 3.0% of the equity sharing agreement due to Unison at closing, which is deducted from the proceeds you receive. You are also responsible for third-party costs such as appraisal and settlement costs (includes title, state taxes, and recording fees). The third-party costs will be disclosed to you prior to closing, and deducted from your proceeds.

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Unison agreements are structured as option contracts, which allows you to sell us a future option for cash today. But it's important to learn about option contracts and understand the details!

How Does an Option Contract Work? | Unison Equity Sharing Agreement

If you’ve owned your home for at least 10 years, it’s likely that you think of it as much more than a part of your financial portfolio. After all, so much changes in a decade, and your house has been there through it all — if you moved into your home when your child was six, that same kid is now driving a car. The puppy that scampered across your kitchen tile then is now a calm adult dog. 

And while you may have been at the peak of your professional career a decade ago, these days you’re likely thinking more seriously about retirement. 

To help understand the changing role of the home over time, Unison conducted a study that can shed light on how best to maximize your investment while mitigating some of the challenges commonly faced by homeowners.

<h3>The new reality of retirement</h3>

Pensions are largely a thing of the past. It’s now up to Americans to finance their own retirements, and that can be a tricky landscape to navigate. In fact, 47% of U.S. homeowners have only saved around $250,000 or less, which falls far short of the <a href="https://www.aboutschwab.com/schwab-401k-participant-study-2019" target="_blank">$1.17 million most people believe they’ll need</a> to support a 30-year retirement. Many of us have been told that having a home fills in the money gap, so it’s not surprising that 25% of American homeowners are planning to use their home to fund their retirement. 

The problem is that most homeowners don’t know how to use their home for retirement. And this lack of planning could have very real consequences. 

<h3>All about the equity</h3>

The beauty of paying a mortgage is that you’re diverting money from a landlord and turning it into equity. It’s tough to actually access that equity, though, without taking out a HELOC (home equity line of credit) or a home equity loan, both of which require being repaid with additional interest. It’s likely due to those constraints that 72% of homeowners have never accessed their home equity. 

That’s a shame, because homeowners could benefit from cash, especially when it comes time for inevitable home improvements. A better way to tap into your home’s equity is to utilize an equity sharing agreement. That way, you can access money from the equity without the high expense or monthly repayment of a HELOC or home equity loan. That frees up money to pay down credit cards and student loans, or to renovate your home. And there’s no interest (thank goodness). 

<h3>In our feelings</h3>

The survey revealed fascinating insights about the positive emotional effects of homeownership. Homeownership makes 43% of people feel secure and makes 34% of homeowners feel stable. In fact, while a quarter of the survey’s respondents said that their home is a nest egg, 31% of homeowners say it’s primarily a place to make memories. 

We’re also protective of our homes and are willing to sacrifice niceties to keep making mortgage payments if hard times hit. Nearly 40% of homeowners would sacrifice going out to eat and 27% would sacrifice spending money on children and grandchildren in order to keep their homes. Having a home pays such emotional dividends that 93% of American homeowners recommend others buy a home as well. 

<h3>Living in the nest </h3>

It’s no secret that more demands are placed on the dollar than ever before. To overcome modern financial challenges, families are banding together and getting smart. Adult children of homeowners are choosing to stay at home longer to make ends meet — in fact, 53% stay for five years or more at some point after turning 18. And parents are pitching in for tuition, transportation, cellphone bills, car insurance, groceries and a host of other things. 

So where are parents getting the money to help their adult kids? Primarily from savings accounts. And that means 47% of parents haven’t been able to save like they need to because they’ve been spending their money on their adult children. That’s risky. 

<h3>Getting ready for what lies ahead</h3>

We love our homes. But it’s important to remember that a home is part of a financial portfolio, which means it should be protected and maximized. 

Check out more about the <a href="https://contentimages.o-prod.unison.com/images/downloads/StateAmerHomeownerReport_1.28.20.pdf">State of the American Homeowner</a> report and learn more fascinating insights about homeownership in the modern age. 

 <a href="https://contentimages.o-prod.unison.com/images/downloads/StateAmerHomeownerReport_1.28.20.pdf">
 <img src="https://contentimages.o-prod.unison.com/images/blog/Thumbnail_download+report.JPG" alt="State of the American Homeowner Report Download" style="width: 75%">
</a>

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Learn how to maximize your investment. Unison’s State of the American Homeowner shows a home’s changing role in an investment portfolio.

The State of the American Homeowner | Unison® Equity Sharing

by Mike Tubbs, Quantitative Portfolio Analyst, with Lauren Rosales-Shepard, Content Writer

 The U.S. inflation outlook continues to show strong signs of improvement! Headline inflation for December was -0.1%, bringing the annual rate down to 6.5%. It’s worth noting that this is the <a href="https://www.cnbc.com/2023/01/12/consumer-prices-fell-0point1percent-in-december-in-line-with-economists-expectations.html">largest month-over-month decrease</a> since April 2020 during peak-COVID. 
 

 Energy prices were the strongest contributing factor, with gas prices falling dramatically in the course of the month (as you yourself probably noticed firsthand). These dropped by a whopping 9.4%, and were additionally down 1.5% from a year ago. 


 Core inflation was 0.3% for the month, with shelter driving the majority of these changes. Still, this draws the annual core inflation number down to 5.7% from December 2022 to December 2021. Compared to where the economy was last December, the annualized inflation numbers are much lower and are showing strong signs of improvement. While annualized core inflation is still elevated, this marks a full quarter of core prices growing much more slowly than the aggressively high rates witnessed over the last year. 

 As we have continued to echo in our previous reports, there is more positive news on the horizon–in particular, because new rent contracts are yet to be fully integrated into current inflation statistics. Remember, the average American doesn’t renew their lease <a href="https://www.marketplace.org/2023/01/12/shelter-costs-rose-in-december-while-the-consumer-price-index-declined-why/">every single month</a>! The pace of shelter inflation is slowing dramatically in real-time data and this will begin to leak into the CPI report over the next three to six months. 

 Core inflation could also see a continued reduction. The Federal Reserve has orchestrated a significant reduction in core inflation over a three to six month window, all while adding an abundance of jobs. December posted a positive 223,000 new jobs, and the unemployment rate <a href="https://www.cnn.com/2023/01/12/economy/cpi-inflation-report-december/index.html">fell to 3.5%</a> during this period. 


 The bottom line? A soft landing without a recession still remains the most likely scenario for the macroeconomy. 

The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

pexels-belle-co-672916

CPI Update: Entering 2023

by Mike Tubbs, Quantitative Portfolio Analyst, with Lauren Rosales-Shepard, Content Writer

 The Bureau of Labor Statistics announced in their <a href="https://www.bls.gov/news.release/pdf/cpi.pdf">November report</a> that the Consumer Price Index (CPI) rose 0.1% (7.1% annual change). This is one of the most optimistic updates of the year, and a significant shift downwards from October’s high of 0.4%. Core inflation was 0.2% for the month, which is happily down from 0.3% in October. 

 Core goods prices have fallen quite rapidly and were actually negative contributors this month, while core services continue their downward trend. This has been most evident in used-car prices which have recently rapidly fallen. 

 Though shelter costs remain a strong contributor to the current inflationary environment, it’s important to remember that these indices are quite backward-looking. Most leases are on an annual basis and so there is a noteworthy lag from six to twelve months in the CPI calculations. Former CEA Chairman Jason Furman substituted new leases <a href="https://twitter.com/jasonfurman/status/1602665320342167553?s=20&t=ooqcl2MnhhCGnv2Ldh3M6A">into the calculator</a> and core CPI actually fell by a staggering -1.2%. 

 The key takeaway is that the Fed’s tightening cycle has drastically affected all the prices in the CPI even if they haven’t materialized in the current rent estimates. This is a slightly optimistic review; taken correctly, with the recent <a href="https://www.cnbc.com/2022/12/14/fed-rate-decision-december-2022.html">50bps rate hike</a>, the Fed may be close to the terminal rate and feel that they have adequately addressed inflationary concerns. The pace of rate hikes can be expected to slow over the next few FOMC meetings. In that case, we expect inflation to moderate and a soft landing as mortgage rates have peaked, and new leases enter the existing CPI calculations. 

The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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December 2022 CPI Update

For the second consecutive year, our Data Science team here at Unison has released the Home Equity Report. The new report highlights a steep increase in home equity in the past year, with U.S. households today sitting on over $29 trillion worth of home equity! This number is a 19.5% increase from a year ago, and 80% from five years ago. 

 The data in the report shows significant regional variations in home equity values; however, all 50 states saw positive growth in median home equity. Though Hawaii and California (perhaps predictably) have the highest median home values, Utah and Delaware have actually seen the strongest growth. The report features multiple other geo-specific data sets, including the metros with the lowest home equity values and weakest growth.

 Home equity tends to increase with the years of homeownership. The report demonstrates that this increase coincides with many homeowners’ growing financial needs–healthcare, for example, or home renovations. With the additional nebulousness of the current market, the solution is clear. Winfield Xu, our Director of Data Science comments, “Instead of keeping the wealth locked up in their properties, homeowners may want to examine the roles of their homes as an accessible source of liquidity.”

 You can read the full 2022 Home Equity Report <a href="https://contentimages.o-prod.unison.com/images/press/2022_home_equity_report.pdf">here</a>.

Cover Picture copia copysm

The report notes that U.S. households currently hold over $29 trillion in untapped equity, and highlights how homeowners may want to consider putting their assets to use.

2022 Unison Home Equity Report

Ed is a father, a husband, and a homeowner who needed to find a way to pay off debt. When he found the Unison HomeOwner program, he realized that not only could he completely pay off all his debt, but also he could also make some long-awaited home improvements that would allow him and his family to enjoy their home even more. Today he is very happy with his remodeled home and is grateful for the newfound financial flexibility he obtained with help from Unison.
<img src="https://contentimages.o-prod.unison.com/images/testimonials/Ed-Shabro-5.png">
Weighed Down By Frustrating Debt
Ed had accrued some credit card debt which was impeding his monthly budget and causing stress to accumulate. It felt like a weight on his shoulders.

He wanted to destroy that debt, so he began looking into options for reducing it or paying it off faster. What he found was that options like a HELOC or mortgage refinance would simply mean swapping one type of debt for another. “We were considering a home equity line of credit or a refinance,” he said. “But all that meant was that I would trade one payment for another payment.”

He needed a better option — one that would allow him to truly reach financial freedom with no additional monthly payments. That’s when he came across Unison.

<img src="https://contentimages.o-prod.unison.com/images/testimonials/Ed-Shabro-7.png">
Ed received a mailer about the Unison HomeOwner program

Considering A New Option: Unison
Around that time, Ed received a mailer from Unison which explained how homeowners like him could unlock their home equity through the Unison HomeOwner program. “I just so happened to get a mailer for Unison and I glanced at it, but I put it aside,” he said.

His first impression was that this looked too good to be true. There must be a catch, he thought. Later, he brought over a savvy friend to help him evaluate his options. The friend, who is a lawyer, examined the Unison program and realized this could be a perfect fit for Ed.

“When he showed up, I let him look at the Unison mailer. He kept looking at it and reading the fine print that most of us don’t read, and he started going ‘Wow this looks pretty good.’ I confirmed it with him and a few other [people] and it made sense.”

With that, Ed was ready to use the Unison HomeOwner program to pay off his debt.

<img src="https://contentimages.o-prod.unison.com/images/testimonials/Ed-Success-Story-9.png">
Ed was able to pay off debt and also to make home improvements

Paying Off Debt and Remodeling the Home
After speaking with a Unison Program Specialist, Ed realized that by unlocking his home equity he would not only pay off his credit card debt — he would also be able to make important renovations on his home.

“Once we did get on board with the Unison concept, I realized I would be able to pay off my debt and have extra money do something with, [so] we committed to pay cash for the first time ever for flooring for my entire house,” said Ed. “It’s going to be like a new house inside.”

Ed and his family are so excited with how their home looks and are grateful for the opportunity to remodel it and turn it into the home they’ve always wanted. Not only that, but Ed feels a sense of relief now that his debt is paid off in full.

“I was just hoping to pay off my debt and have that breathing room monthly. And I’ve done that and I’m doing a lot more for my house and for my family. It’s awesome.”

<img src="/Ed-Success-Story-3.png">
Ed was thrilled to put new flooring throughout his home.

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

Unison helped this homeowner pay off debt and remodel their home with home equity funds.

Homeowner Testimonial | Unison Home Equity Sharing | Blog

Life can be expensive. And unpredictable. We all find ourselves short on funds for something sooner or later.
 Instead of taking out a loan or loading up your credit cards, if you’re already a homeowner with equity in your home, you have some options.
<img src="https://contentimages.o-prod.unison.com/images/blog/Couple-on-bench.jpg">
<h3>The traditional possibilities</h3>
 Traditionally, there are four ways to access your home equity, and they all involve banks. (“Equity” is the difference between what your home is worth and how much you owe on your loan. Your equity increases over time if the property value increases or the mortgage loan balance is paid down.) 
<ul>
 <li>Home equity loan (aka second mortgage)</li>
 <li>Home equity line of credit (HELOC)</li>
 <li>Cash-out refinance</li>
 <li>Personal loan</li>
</ul>
 Home equity loan 
Similar in structure to your primary mortgage, this option could make sense if you don’t want to refinance that loan. With a home equity loan, you borrow against the equity in your home and receive a lump sum of money that you have to pay back each month within 15 years. The interest rate is usually fixed, but is typically higher than your primary mortgage. Home equity loans are popular for homeowners with an immediate need for the entire balance, such as a medical emergency.
 HELOC 
Like a home equity loan, a HELOC lets you borrow against the equity in your home. The remaining value of the home provides your bank with insurance on your primary mortgage. We explain what a HELOC is here, but the main point is that a HELOC adds significantly more debt to your burden. Monthly payments are often high because they pay off more interest than principal on the outstanding balance.
 Another drawback is the requirement that borrowers have to withdraw a minimum amount of money, even if it’s more than what’s needed. Interest is calculated on the amount borrowed, which means borrowers pay interest on money they didn’t need in the first place.
 Cash-out refinance 
If you have substantial equity in your home, a cash-out refinance lets you pay off your current mortgage by refinancing it at a higher amount and taking the difference in cash. Closing costs are usually high, but if you have a high credit score, you could qualify for a lower interest rate than your original mortgage.
 Personal loan 
You generally don’t need to put up collateral, but you’ll need a high credit score to qualify for the best rates. Those rates will almost always be higher than with home equity financing.
<h3>Disrupting the old way with a modern solution</h3>
 Home equity loans, HELOCs and cash-out refinancing don’t serve the needs of all homeowners or homebuyers--especially when you’re dealing with a lot of debt. You’re essentially paying a bank to access the money you’ve already invested in your home.
 Unison is the world’s first home equity sharing company with a mission to disrupt the old ways and provide a smarter, better way to buy and own homes. Our innovative HomeOwner program lets you tap into the wealth you’ve accumulated in your home, without borrowing from a bank, extra interest charges or monthly payments. Rather than a loan, we’re a long-term investor in your home, until you decide to sell up to 30 years in the future.
<h3>Here’s how HomeOwner works</h3>
 We invest up to 17.5% of the current market value of your home. So if your home is valued at $730,000, then we’ll give you up to $127,750. You can use all or a portion of this money however you want--to lower debt, renovate your home, start a business, fund your retirement or pay school tuition. We can usually provide funds to you within 30 days of submitting your application. We know that when you need money, you need it sooner rather than later.
 When you sell your house, the return on the investment is divided in a 60/40 split. If the value of the home has increased, we share in the profit of our original investment. If the value has decreased, we share in the loss.
 Say you accessed $50,000 of your home equity through a HomeOwner co-investment, and now you want to sell your home. If the value of your home has increased by $100,000 since the investment, you’d pay back an amount equal to the initial investment ($50,000) plus 40% of the increased value of your home ($40,000), for a total of $90,000. Meanwhile, all of the equity you’ve built with your monthly mortgage payments belongs to you.
 If your home has decreased by $50,000, then you’d pay back an amount equal to our initial investment minus 40% of the loss ($40,000), which comes to $10,000. You pay less because Unison is an investment partner in your home, not a bank.
 We have a vested interest in your success. And a personal one, too.
 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

jason-briscoe-heEPoapeiVk-unsplash

Home equity sharing is a smarter way to tap into the equity you own without monthly payment or added debt. Learn how you can access your home equity funds through a partnership with Unison.

Access Home Equity without Adding Debt | Unison® Equity Sharing

Phil Suess 

We’re once again approaching fire season in California. While rain in April and May brought a slight reprieve, rainfall was not enough to compensate for one of the driest starts to a year on record. The combination of drought conditions and Covid-19, which makes convening firefighters in large groups challenging, has officials worried, and homeowners questioning how wildfires may affect their home insurance. We've assembled a list of a few common questions to address some of the concerns. 

<h2 class="headline headline--small">Do I need separate insurance for wildfires?</h2> 

The short answer is normally no. While damage caused by fires is covered by most residential hazard insurance policies, it is important to read through your current policy or any new policies you are considering. The chart<a href="#ftn1">[1]</a> below was published by the California Department of Insurance and lists the types of damages typically covered and not covered by a homeowner’s policy. 

<img src="https://contentimages.o-prod.unison.com/images/blog/perils-homeowner-policy.png" style="width: 75%">
<h2> </h2> 

<h2 class="headline headline--small">Can my insurance change if there is a wildfire incident near me?</h2> 

Yes, insurance availability and rates do change over time, so it is important to monitor insurance renewal notices and non-renewal notices. The California Department of Insurance does offer some protection to consumers immediately following wildfires. Currently, regulators can ban insurers from issuing non-renewal notices for one year in zip codes impacted by wildfires. The list of zip codes impacted by wildfire is determined by the Insurance Commissioner based on data provided by the Department of Forestry and Fire Protection. The zip codes protected from insurance non-renewals in 2019 are listed <a href="
http://www.insurance.ca.gov/01-consumers/140-catastrophes/wildfirenonrenewalinfo.cfm">here</a>.
 

<h2 class="headline headline--small">Are there different types of insurers?</h2> 

Yes, there are two categories of insurers: admitted and non-admitted insurers. The difference between these categories is based on their status with the state government. All admitted insurers are required to contribute to the state’s guaranty fund and are backed by the state’s guaranty fund. This means that if an admitted insurer becomes insolvent or has more claims than it can afford to pay out, then the guaranty fund will contribute to the shortfall up to specified limits.<a href="#ftn2">[2]</a> 

While non-admitted insurer may sound like a negative term, it has more to do with the insurer’s status with the government than its quality of coverage. Non-admitted insurers provide coverage in regions where coverage by admitted insurers is limited. Additionally, non-admitted insurers do not contribute to the state’s guaranty fund and are therefore not backed by the fund in the case of insolvency. While non-admitted insurers do not participate in the guaranty fund, they must set aside significant reserves or obtain re-insurance. 

<h2 class="headline headline--small">
What happens if I cannot find insurance? </h2> 

For individuals unable to obtain coverage from admitted and non-admitted insurers, there is the California Fair Access to Insurance Requirements Plan (FAIR). It is an option of last resort, meaning individuals can only participate in this option after “a diligent effort to obtain coverage in the voluntary market has been made.”<a href="#ftn3">[3]</a> The FAIR Plan is “an insurance pool established to assure the availability of basic property insurance to people who own insurable property in the State of California and who, beyond their control, have been unable to obtain insurance in the voluntary insurance market<a href="#ftn4">[4]</a>.” 

The FAIR Plan offers homeowners an insurance option, but it is far from all encompassing. Coverage is limited to $1.5 million for residential properties, only covers damage from fire or lightning, internal explosion, and smoke and requires the homeowner to get a separate difference in condition policy from another insurer to cover the shortfalls of the FAIR Plan<a href="#ftn5">[5]</a>. Additionally, the FAIR Plan will not estimate the amount of necessary coverage for a homeowner. In November 2019, the California Department of Insurance mandated the FAIR Plan to double its maximum coverage to $3 million as of April 1, 2020. The mandate also required the FAIR Plan to introduce comprehensive insurance policy options by June 2020. A comprehensive policy relieves homeowners from having to seek out and purchase multiple policies to cover other hazards such as liability, water damage, and theft. The mandate to offer comprehensive insurance of policies was challenged in the Los Angeles Superior Court, with the court issuing a preliminary injunction as of February 2020<a href="#ftn6">[6]</a>. 

More information on the FAIR plan is available can be found <a href="
https://www.cfpnet.com/">here</a>. 
 

<h2 class="headline headline--small">Where can I find information on changes to the homeowner insurance industry?</h2> 

Given the current insurance environment, it is important to stay alert to changes in the industry. There are several interested parties working toward making changes to the current structure. If you’re interested in monitoring which proposals are implemented, check out the California Department of Insurance site <a href="

http://www.insurance.ca.gov/0400-news/0100-press-releases//">here</a>. 

<div id="footnotes">
[1]
 The complete report on residential homeowners insurance is available at http://www.insurance.ca.gov/flipbook/residential/

[2] More information on Guaranteed Funds is available at http://www.caiga.org/finance.html

[3] https://www.cfpnet.com/

[4] IBID </a> 

<a href="http://www.insurance.ca.gov/0400-news/0100-press-releases/2019/release089-19.cfm" target="_blank">[5]</a> "Growing need for FAIR Plan leads Insurance Commissioner to ...." Accessed 27 May. 2020. 

<a href="https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/court-issues-preliminary-injunction-halting-changes-to-california-s-fair-plan-57180502" target="_blank">[6]</a> "Court issues preliminary injunction halting changes to ...." 20 Feb. 2020. Accessed 27 May. 2020. 

The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.</div>
 
 
 

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The need for fire insurance varies depending on your location and situation, but with the risk of wildfires becoming increasingly relevant, so does the need for this specific home coverage.

Do I Need Fire Insurance? | Unison® Home Equity Sharing

Unison’s "Home for the Holidays" 2022 Sweepstakes 

 How do you celebrate at your home for the holidays? In the spirit of the season, we invite you to give us a window into your festivities! Tag Unison on <a href="https://www.facebook.com/MyUnison/">Facebook</a> (@MyUnison) or <a href="https://instagram.com/myunison">Instagram</a> (@myunison) and use the hashtags #UnisonHoliday #2022sweepstakes in your holiday photo or video for a chance to win your share of $1000! Be aware that if you have a private account, you will need to follow us in order for us to see your entries. Don’t have social media? No problem–<a href="mailto:sweepstakes@unison.com?subject=Home for the Holidays Sweepstakes">shoot us an email</a> with your entry!



 There will be two drawings; one on December 16, 2022, and the other on January 3, 2023.



 To be eligible for the first drawing, please make your post or submit your email by midnight (CST), December 14th. The deadline for the second drawing is midnight (CST), January 1st. 

 Five winners will be selected at random via raffle on each drawing date to win a $100 giftcard! 

 We will reach out via DM, Facebook Messenger, or return email (as the case may be), to gather contact information on where to send your prize and confirm that you are eligible to receive it. If the winners do not respond to our message within 48 hours, a back-up winner will be contacted in their stead. The winners will be posted on Unison’s social media and announced in our subsequent newsletter.

 The fine print:
<ul><li>This sweepstakes is in no way sponsored, endorsed or administered by, or associated with Instagram or Facebook.</li>
<li>This sweepstakes is limited to United States residents over the age of 18, and cannot be entered by employees or partners of Unison. </li>
 <li>There is absolutely no purchase necessary!</li>
<li>When you enter the sweepstakes, please note that you authorize Unison to post your photo or video to our social media, feature in our monthly newsletter, or otherwise utilize it without seeking additional permissions (except where prohibited by law).</li></ul>
 

 



 The fine-fine print:
 
The following official rules (“Official Rules”) govern the Unison’s Home for the Holidays 2022 sweepstakes (the “Sweepstakes”). 

 NO PURCHASE NECESSARY TO ENTER OR WIN. A PURCHASE DOES NOT IMPROVE YOUR CHANCES OF WINNING.

<ol>
 <li>Sponsorship. The sponsor is Real Estate Equity Exchange, Inc. d/b/a Unison, 650 California Street, Suite 1800, San Francisco, CA 94108 (“Sponsor”). Sponsor will conduct the Sweepstakes substantially as described in these Official Rules. </li>
 <li>Eligibility. The Sweepstakes is open to legal residents of the United States of America who complete the entry requirements set forth below in paragraph 5 (How to Enter). Entrants must be 18 years or older as of their date of entry in order to qualify. The Sweepstakes is subject to federal, state, and local laws and regulations and void where prohibited by law. Sponsor’s employees, its subsidiaries, affiliates, suppliers, partners, advertising and promotion agencies, and directors (collectively the “Employees”), as well as members of an Employees' immediate family and/or those living in the same household of Employees are ineligible to participate in the Sweepstakes. </li>
 <li>Agreement to the Official Rules. By entering this Sweepstakes, the entrant (“You”) agrees to abide by the Sponsor's Official Rules and decisions, which are fully and unconditionally binding in all respects. The Sponsor reserves the right to refuse, withdraw, or disqualify any entry at any time at the Sponsor’s sole discretion. By entering this Sweepstakes, You represent and warrant that You are eligible to participate based on eligibility requirements explained in the Official Rules. You also agree to accept the decisions of the Sponsor as final and binding as it relates to the content of the Sweepstakes.</li>
 <li>Entry Periods. The Sweepstakes consists of two periods of entry that are described below (each, an “Entry Period”). To be eligible for the Sweepstakes, entries must be received within the specified Entry Period.
 First Entry Period: on or after 12:01 a.m. Central Time, November 16, 2022 until 11:59 p.m. Central Time, December 14, 2022.
 Second Entry Period: on or after 12:01 a.m. Central Time, December 16, 2022 until 11:59 p.m. Central Time, January 1, 2023.</li>
 <li>How to Enter. There are two ways to enter: 
First, eligible entrants can enter the Sweepstakes by uploading a holiday-themed photo or video to Instagram or Facebook, including the hashtag #2022UnisonHolidaySweepstakes, and tagging Unison (@myunison on Instagram and @MyUnison on Facebook). If you have a private account, you will need to follow Sponsor in order for Sponsor to see your entries.
Second, eligible entrants can enter the Sweepstakes by emailing sweepstakes@unison.com with the subject line “Home for the Holidays Sweepstakes.” 
Regardless of the method of entry, entries must be submitted within the designated Entry Period. Regardless of the method of entry, eligible entrants may submit only one entry per each Entry Period. Winner(s) will be selected and notified as stated below in paragraph 8 (Selection and Notification of Winner(s)). Fraudulent methods of entry or circumvention of the rules may result in the Sponsor invalidating entrant’s entries and removing entrant from the Sweepstakes at the Sponsor’s sole discretion. Entries must fully meet all Sweepstakes requirements, as specified in the Official Rules, in order to be eligible to win a prize. Incomplete entries or those that do not adhere to the Official Rules or specifications will be disqualified at the Sponsor's sole discretion. </li>
 <li>Prizes. The winner(s) of the Sweepstakes (the “Winner(s)”) will receive one (1) of ten (10) prepaid gift cards in the amount of One Hundred Dollars ($100). Five (5) of the ten (10) gift cards will be awarded to Winner(s) from the First Entry Period, and five (5) of the ten (10) gift cards will be awarded to Winner(s) from the Second Entry Period. The actual/appraised prize value may differ at the time the prize is awarded. The prize(s) shall be determined solely by the Sponsor. There shall be no cash or other prize substitution permitted except at the Sponsor’s discretion. The prize is non-transferable. The Winner, upon acceptance of the prize, is solely responsible for all expenses related to the prize, including without limitation any and all local, state, and federal taxes. The Winner shall not transfer assignment of the prize to others nor shall the Winner request the cash equivalent or prize substitution. By accepting the prize, the selected Winner grants permission for the Sponsor to use the Winner’s likeness, entry, and name for purposes of advertising and trade without compensation unless prohibited by law. </li>
 <li>Odds. The total number of eligible entries received determines the odds of winning.</li>
 <li>Selection and Notification of Winner(s). The Winner(s) will be selected at random. The drawing from among eligible entries from the First Drawing Period will take place on December 16, 2022 at 3:00 p.m. Central Time. The drawing from among eligible entries from the Second Drawing Period will take place on January 3, 2023 at 3:00 p.m. Central Time. Winner(s) will be notified by social media direct message and/or email. Winner(s) must acknowledge receipt of notification and acceptance of the prize as directed by Sponsor within forty-eight (48) hours of notification. Winner(s) may be required to complete an affidavit of eligibility and liability/publicity release form (except where prohibited by law) (collectively, "the Prize Claim Documents") which must be returned as directed by Sponsor within the timeframe given. Awarding of a prize is subject to verification of a potential Winner’s eligibility and full compliance with these Official Rules, in the sole discretion of the Sponsor. The Sponsor is not responsible for nor shall have no liability for Winner’s failure to receive notices due to email security settings that may cause notifications to be marked as spam or junk email or DM filter to social media message request folder. Nor shall Sponsor be liable for the Winner’s provision of incorrect or otherwise non-functioning contact information. If the Winner 1) fails to respond to the notification message within 48 hours of the notice, 2) is found ineligible, or 3) does not complete and return the Prize Claim Documents within the specified timeframe, at the Sponsor’s sole discretion, the prize may be forfeited and an alternate Winner may be selected at random. Receipt of the prize (offered in the Sweepstakes) by the Winner is upon the condition of compliance with any and all federal, state, and local laws and regulations. IF THE WINNER VIOLATES ANY OF THESE OFFICIAL RULES, THE WINNER (AT THE SPONSOR’S SOLE DISCRETION) WILL BE DISQUALIFIED, AND ALL PRIVILEGES AS WINNER WILL BE IMMEDIATELY TERMINATED. </li>
 <li>Rights Granted by You. By submitting an entry (e.g., photo, video, email, etc.) into the Sweepstakes, where permitted by law, You hereby irrevocably and in perpetuity grant to Sponsor, and those acting under Sponsor’s authority, the unrestricted, absolute, perpetual, worldwide right and license to use Your name, address, photograph, likeness, voice, biographical and personal information, statements, Sweepstakes application, and any photograph, film, video, audio recording or other recording taken of You or such materials (collectively, “Content”), and all in connection with marketing purposes including without limitation the promotion of the Sweepstakes and other sweepstakes and contests or the provision of publicly available Winners lists (“Promotion”), and to reproduce, copy, modify, create derivative works of, display, perform, exhibit, distribute, transmit or broadcast, publicly or otherwise, or otherwise use and permit to be used, the Content or any part thereof, whether alone or in combination with other materials (including but not limited to text, data, images, photographs, illustrations, and graphics, video or audio segments of any nature), in any media whatsoever in connection with the Promotion, and all the foregoing without any compensation, royalties, remuneration or consideration to You or any third party, and You hereby waive all claims to compensation, royalties, remuneration, consideration, notice or permission in connection therewith. </li>
 <li>Terms & Conditions. In its sole discretion, the Sponsor reserves the right to modify, suspend, cancel, or terminate the Sweepstakes should non-authorized human intervention, a bug or virus, fraud, or other causes beyond the Sponsor’s control, impact or corrupt the security, fairness, proper conduct, or administration of the Sweepstakes. The Sponsor, in the event of any of the above issues, may determine the Winner based on all eligible entries received prior to and/or after (if appropriate) the action taken by the Sponsor. Entrants who tamper with or attempt to tamper with the operation or entry process of the Sweepstakes or violate these Terms & Conditions will be disqualified by the Sponsor in its sole discretion. In its sole discretion, the Sponsor has the right to maintain the integrity of the the Sweepstakes, to void votes for any reason, including, but not limited to: multiple entries from the same user; multiple entries from the same computer beyond the number allowed by the Sweepstakes rules; or the use of bots, macros, scripts, or other technical means for entering. Attempts by any entrant to deliberately damage any website or undermine the legitimate operation of the Sweepstakes may be a violation of criminal and civil laws. If any such attempt is made, the Sponsor reserves the right to seek damages to the fullest extent permitted by law.</li>
 <li>Limitation of Liability. Your entry into the Sweepstakes constitutes Your agreement, on behalf of Yourself, Your heirs, executors and administrators, to release, forever discharge, and hold harmless the Sponsor and any other party associated with the development or administration of the Sweepstakes, and their respective parent, subsidiary, or affiliated entities, and their respective officers, directors, members, shareholders, employees, independent contractors, agents, representatives, successors and assigns (collectively, “Sweepstakes Entities''), from and against any and all liability for any and all indirect, incidental, consequential or punitive damages, costs, expenses, claims (including without limitation third party claims), injuries or losses (“Damages”) arising from or relating to, in whole or in part, the Sweepstakes, including without limitation in connection with applications and the prize, including without limitation in connection with: (a) technical, printing, typographical, human or other errors, (b) applications or data being lost, corrupt, misdirected, stolen, lost, late, damaged, incomplete, mutilated or illegible, (c) hardware, software, browser, computer, server, or network failure, malfunction, congestion, delay, error, or incompatibility, or (d) any application not being accepted on account of any of the foregoing. You agree that in all cases the Sweepstakes Entities’ maximum aggregate liability shall be limited to Your direct costs of entering and participating in the sweepstakes, and in no event shall the Sweepstakes Entities be liable for any attorneys fees.
 </li>
 <li>Disputes. THE SWEEPSTAKES IS GOVERNED BY THE LAWS OF THE UNITED STATES OF AMERICA AND THE STATE OF CALIFORNIA, WITHOUT RESPECT TO CONFLICT OF LAW DOCTRINES. You agree, as a condition of participating in this promotion, that if any disputes cannot be resolved between You and the Sponsor, and if causes of action arise out of or are connected with this Sweepstakes, they shall be individually resolved exclusively before a court located in California having jurisdiction, without resorting to any form of class action. Under no circumstances in any such dispute shall the participant be permitted to obtain awards for, and hereby waives all rights to, punitive, incidental, or consequential damages, including reasonable attorney’s fees, other than participant’s actual out-of-pocket expenses (i.e. costs associated with entering this Sweepstakes). The participant waives all rights to have damages multiplied or increased. </li>
 <li>Privacy Policy. Information submitted with an entry is subject to the Sponsor’s Privacy Policy. Please visit the Sponsor’s website to read the Privacy Policy at http://www.unison.com/legal/. </li>
 <li>Winners List. You may obtain a copy of the Winner’s name(s) or a copy of these Official Rules, by sending your request via email to sweepstakes@unison.com.</li>
 <li>Social Media Rules. The Sweepstakes is in no way sponsored, endorsed, administered by, or associated with Facebook, Instagram, or any other social media platform. You understand that you are providing your information to Sponsor and not Facebook or Instagram.</li>
</ol>
 
By entering the Sweepstakes, You (the entrant), have affirmatively reviewed, accepted, and agreed to all of the Official Rules.

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How do you celebrate at your home for the holidays? In the spirit of the season, we invite you to give us a window into your festivities!

"Home for the Holidays" 2022 Sweepstakes Official Rules

A question we often get at Unison is "where do you get your funds?" People want to have confidence our investment in their home is coming from someone focused on the long-term.
 
At a fundamental level, Unison connects homeowners and homebuyers with institutional investors, and allows them to solve each other's needs. On one hand, Unison helps homebuyers, who have never faced a more challenging time to buy a home, and homeowners who want to access money trapped in their house for their children’s educations, their retirement needs, healthcare and renovations. On the other hand, Unison helps institutional investors access an asset which is closely aligned to their long-term objectives: diversified residential real estate. 

Housing is the largest asset class in the world, nearly 1/5th of the economy and the largest component of inflation. Based on these characteristics, it deserves a core role within long-term investment portfolios as a hedge against inflation and a way to capture the benefits of economic growth. 

However, housing has historically been inefficient for institutional investors to access. As any would-be landlord knows, buying individual homes, managing them, finding tenants, maintaining properties, etc. is costly, time consuming and nearly impossible to do in a truly diversified way. By co-investing with homeowners and homebuyers, Unison allows investors to overcome these costs and inefficiencies. 

So, who are these investors? They are organizations who invest for the long-term, and who help everyday people. Pension funds and university endowments are two key examples for Unison.

<h3>Pension Funds</h3>

Pension funds provide for ordinary people (such as teachers and healthcare workers) in their retirement, and help them live their golden years as they want to. A pension fund’s success is measured by whether it keeps the promise it owes retirees in the decades (not just individual years), ahead. Housing is one of the largest costs retirees face and a core way for pension funds to preserve the real (inflation-adjusted) value of money set aside to pay pensions.

<h3>University Endowments</h3>

University endowments have a long-term (often considered "infinite") time horizon. Endowments exist to help pay for the operating cost of a university, fund new facilities and provide for ground-breaking research in perpetuity. To meet these needs, they must preserve the inflation-adjusted value of their investments over the very long-term. A diversified investment in housing to closely aligned with this goal.

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Housing is a huge market, but it's difficult for investors to put their money in homes without owning them outright. Learn more about how home equity sharing help bridge the gap.

Where does Unison get its funds? | Unison® Home Equity Sharing

In determining the price of a home, many people only consider the listing price of a home, without considering the cost of interest on a loan used to finance the home. The truth is that you will probably pay a significant amount of interest over the life of your mortgage — but that’s okay. You simply need to be prepared for it.

Interest on any loan, mortgage, credit cards, or otherwise, is the fee you pay to the lender for allowing you to borrow the initial sum of money. The amount of money you actually borrow is called the “principal” on the loan. The interest rate determines the amount you owe on each loan payment and how much you’ll pay over the life of the loan.

<img src="https://contentimages.o-prod.unison.com/images/blog/How-Much-Interest-Will-I-Pay-On-My-Mortgage-e1508780676454.jpg">

The Rate Determines How Much Interest You Pay on Your Mortgage

Getting the lowest interest rate possible is important. The rate determines how expensive your mortgage really is. The lower the interest rate, the lower the fee you pay to borrow money from a lender.

It makes a big impact when you can see how a small change in the rate can change how much interest you owe. Let’s look at a few examples to see how small adjustments can create very different outcomes.

For these examples, we’ll assume this is a conventional mortgage with a 30-year term. Let’s look at how different loan amounts impact the amount of interest you’ll pay on your loan first.

<table>
 <tr>
 <th>Loan amount</th>
 <th>Interest Rate</th>
 <th>Monthly Payment</th>
 <th>Interest Paid in Total</th>
 <th>Total Cost of Mortgage</th>
 </tr>
 <tr>
 <td>$200,000</td>
 <td>4.0%</td>
 <td>$954.83</td>
 <td>$143,739.01</td>
 <td>$343,739.01</td>
 </tr>
 <tr>
 <td>$250,000</td>
 <td>4.0%</td>
 <td>$1,193.54</td>
 <td>$179,673.77</td>
 <td>$429,673.77</td>
 </tr>
 <tr>
 <td>$400,000</td>
 <td>4.0%</td>
 <td>$1,909.66</td>
 <td>$287,478.03</td>
 <td>$687,478.03</td>
 </tr>
 <tr>
 <td>$600,000</td>
 <td>4.0%</td>
 <td>$2,864.49</td>
 <td>$431,217.04</td>
 <td>$1,031,217.04</td>
 </tr>
 <tr>
 <td>$750,000</td>
 <td>4.0%</td>
 <td>$3,580.61</td>
 <td>$539,021.30</td>
 <td>$1,289,021.30</td>
 </tr>
 <tr>
 <td>$1,000,000</td>
 <td>4.0%</td>
 <td>$4,774.15</td>
 <td>$718,695.06</td>
 <td>$1,718,695.06</td>
 </tr>
</table>

 
Interest makes the total amount you pay for your home much higher than the actual purchase price. This is why it’s so important to carefully look at your budget and consider what you can really afford to pay over time.
The lender is motivated to let you borrow as much as you can possibly afford. The more you borrow, the more you pay back to them in interest. Only borrow what you need and make sure to save enough for a down payment to reduce the amount of your new home you need to finance (or use a home co-investment).
Now, let’s look at how different interest rates impact the cost of your mortgage.

<table width="100%">
 <tr>
 <th>Interest Rate</th>
 <th>Loan Amount</th>
 <th>Monthly Payment</th>
 <th>Interest Paid in Total</th>
 <th>Total Cost of Mortgage</th>
 </tr>
 <tr>
 <td>3.0%</td>
 <td>$400,000</td>
 <td>$1,686.42</td>
 <td>$207,109.81</td>
 <td>$607,109.81</td>
 </tr>
 <tr>
 <td>3.5%</td>
 <td>$400,000</td>
 <td>$1,796.18</td>
 <td>$246,624.35</td>
 <td>$646,624.35</td>
 </tr>
 <tr>
 <td>4.0%</td>
 <td>$400,000</td>
 <td>$1,909.66</td>
 <td>$287,478.03</td>
 <td>$687,478.03</td>
 </tr>
 <tr>
 <td>4.5%</td>
 <td>$400,000</td>
 <td>$2,026.74</td>
 <td>$329,626.85</td>
 <td>$729,626.85</td>
 </tr>
 <tr>
 <td>5.0%</td>
 <td>$400,000</td>
 <td>$2,147.29</td>
 <td>$373,023.14</td>
 <td>$773,023.14</td>
 </tr>
</table>
 
Once you determine how much you can truly afford to borrow, getting the lowest interest rate possible is crucial. Even half a percentage point, from 3% to 3.5%, will cost you $100 extra every month — and over the lifetime of your loan, you’ll pay nearly $40,000 more just in interest!
The difference in a full point of mortgage interest is even more dramatic. If you have to pay an interest rate of 4.5% instead of 3.5% on your loan, your monthly payment will cost $230.50 more. The total cost of your mortgage will also be $83,000 higher than the loan with the lower interest rate.
It’s also important to note that the amount you pay in interest each month changes the longer you make payments. Initially, you’ll pay more interest each month. But as you reduce the balance on your loan, your interest payments decrease and the amount you put toward your principal increases.
For example, if you borrow $200,000 at a 4% interest rate, your very first monthly payment will include $666.67 in interest and $288.16 toward the principle. After 5 years of making mortgage payments each month, your monthly payment breaks down into $604.15 in interest charges and $350.68 going to the principle. At 10 years, your interest payment is $526.65 and your principle is $428.18.
Be sure to look at your full amortization schedule to see exactly how much in interest you pay on a monthly basis. Online mortgage calculators can help.
How to Reduce the Interest You Pay on a Mortgage
It’s well worth it to do everything in your power to get a lower interest rate. Doing so means paying less each month, which frees up more money in your cash flow. It also means saving tens of thousands of dollars over the 30 years you make payments on your mortgage.
In general, interest rates are determined by market conditions and the economy. You can’t control that — but you can take action to qualify for the lowest interest rates lenders currently offer.
Charging interest is how lenders make money on the loans they originate. And lending money is risky, because there’s always a chance a borrower may stop making payments or fail to repay a loan. Lenders only offer the lowest mortgage rates to people who pose the lowest risk of not making payments or defaulting on their mortgages.
To reduce the interest you need to pay on your mortgage, you need to show the lender you’re a low-risk borrower. Here are a few ways to do that:
<ul>
 <li>Put more money down. A larger down payment means you finance less of the purchase, which means you pose less of a risk to the lender. You’ll have a smaller loan amount and smaller monthly payments. 
 <li>Show proof of steady income and low debt. Lenders want to know you can reasonably afford to repay your loan. They look for consistent, reliable sources of income that you can use to make your payments. And if you have little to no debt, you have more cash available to pay your mortgage with.</li>
 <li>Maintain a good credit score. A credit score is a measure of how creditworthy you are, and is another metric lenders use to assess risk. Credit reporting agencies calculate scores based on predictive data. Their research indicates that if someone has a history of late or missed payments, for example, they are more likely to miss or not make payments at all in the future. Their credit score will be lower as a result, and a lender will see that person as higher-risk than a borrower with a good credit score. The higher your credit score, the lower interest rates you can qualify for.</li>
 </ul>
You can also reduce the amount of interest you pay over time by making extra payments on your mortgage. So even if you can’t qualify for the lowest interest rate, you can save money by paying down the balance faster.
Remember, interest is simply the cost of borrowing money from the lender. Understanding how interest works — and how you can reduce it — can allow you to better prepare your home-buying budget.

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Unison takes a look at the amount of interest that will likely accrue over the lifespan of your mortgage. Learn how to manage it and stay prepared.

How Much Interest Will I Pay on My Mortgage? | Unison

If you put down less than 20 percent in cash on your conventional mortgage loan, chances are that you should plan to pay private mortgage insurance. 

Private mortgage insurance, or PMI, sounds like it might be a helpful protection against something happening to your mortgage. And it is — but for your lender, not for you. 

<img src="https://contentimages.o-prod.unison.com/images/blog/How-Much-Does-PMI-Cost-e1514920318503.jpg" />

The policy protects the lender if you stop making payments on the loan or end up in foreclosure. Even though the lender is the beneficiary of the policy, you as the homeowner must pay the monthly premiums. 

Here’s what you need to know about how it works and how much it costs to pay PMI. 

<h3>Where Do You Pay PMI — and How Much Does PMI Cost?</h3>
The PMI cost is usually rolled into your monthly mortgage payment, along with principal and interest, property taxes and your homeowner’s insurance premium. 

So, how much does PMI cost: it depends on a few different factors, but you can generally expect to pay a monthly premium of $30 to $70 for every $100,000 that you borrowed, <a href="http://www.zillow.com/mortgage-learning/private-mortgage-insurance/#cost" target="_blank">according to Zillow</a>. 

Many lenders require a down payment of 20 percent in order to avoid PMI. Some homeowners determined to avoid PMI wait to save more money before buying, while others explore options like <a href="/homebuyer/">homeownership investment programs</a>. 

But depending on your financial situation, saving more could take years of work — and not everyone wants to invest in a home with a third party. In that case, you’ll need to face PMI as an added expense on your mortgage. 

<h3>Breaking Down the Cost of PMI</h3>
Clearly, there are both pros and cons of PMI. We can use a specific example to better understand how PMI cost impacts the amount of money you need to pay each month on your mortgage. 

Let’s say you buy a house and get a 30-year loan for $250,000 with an interest rate of 4 percent. Your monthly payment for principal and interest will be $1,194. 

Let’s also say that you owe the following each month: 
<ul>
<li>Property taxes: $100</li>
<li>Homeowners insurance: $80</li>
<li>PMI: $125</li>
 </ul>
Your total monthly payment with the $125 worth of PMI would be $1,499. Without PMI, you’d pay $1,374 per month. 

<h3>PMI Isn’t Forever, But Removing It Isn’t Easy</h3>

While paying PMI isn’t ideal, you won’t be on the hook forever. You can request for the lender to remove PMI from your loan once you reach a <a href="https://www.consumerfinance.gov/ask-cfpb/what-is-a-loan-to-value-ratio-and-how-does-it-relate-to-my-costs-en-121/" target="_blank">loan-to-value</a> ratio of 80 percent. That includes paying for an appraisal to prove your loan is indeed 80 percent of the home’s value. 

If you wait, though, the lender is required to remove PMI automatically once the loan balance is 78 percent of the original home value. 

Still, some lenders don’t remove this right on schedule. It’s important to know when PMI cost should drop according to your <a href="https://www.investopedia.com/terms/a/amortization_schedule.asp" target="_blank">amortization schedule</a>, and to call the lender to confirm PMI will come off your monthly payment when it’s time. 

Let’s use another example to understand how much you might pay in PMI cost. Going back to our previous example, we can say the original value of the home you bought was $293,750. 

You took out a $250,000 mortgage, so in this case, you can request that the lender remove PMI once your balance reaches $235,000. 

With a monthly payment of $1,194 (that’s your principal and interest), it will take you 40 months before you can request that the lender remove PMI. By this time, with a monthly PMI cost of $125, you’ll have paid $5,000 toward PMI. 

If you believe a combination of your mortgage payments plus the home’s increase in value thanks to a good market makes your loan 80 percent or less of the home’s total value, it might make sense to hire an appraiser and request your lender take PMI off early. 

Appraisals <a href="https://www.homeadvisor.com/cost/inspectors-and-appraisers/hire-a-property-appraiser/" target="_blank">typically cost between $250 and $450</a>, which would be well worth the cost if it meant you didn’t need to spend the full $5,000 in PMI that you would pay for if you simply waited for the premium to fall off as scheduled. 

<h3>Should You Wait and Save 20 Percent for a Down Payment Instead?</h3>
While there are ways to put 10% down with no PMI, you can be sure to avoid PMI altogether if you simply save 20 percent or more for a down payment. That’s not always easy, of course. It could take you far longer to save that full amount before you buy. 

There are risks to going this slower route, too. Imagine that it takes you 5 years to save the full down payment and you can then get a 30-year loan for $235,000 instead of $250,000 — but if interest rates rise during the years you’re saving, it might not be worth it. 

Moving from a 4 percent interest rate to a 5 percent rate increases your monthly payment to $1,342 for principal and interest. You’ll also pay an extra $180 for property taxes and homeowner’s insurance, bringing your total to $1,522. 

Of course, there’s no guarantee that this is how things will play out. It’s impossible to predict how interest rates will change, even in the short term. 

The point is that any strategy you use for buying a house comes with risk, and some homeowners prefer to act sooner rather than leave their home-buying plans up to chance. If you really don’t want to pay PMI, you can research options for “no PMI” mortgage loans. 

<h3>How to Lower Your PMI</h3>
If you’re planning on putting down less than 20 percent on your mortgage, you’re not totally at the mercy of the lender as far as your PMI premium goes. 

Since PMI is meant to protect lenders against default, they’ll charge higher premiums to borrowers who are more at risk of default. Having good or excellent credit means you’re less of a risk, so you’ll get a lower premium. 

If your credit isn’t stellar, look for ways to <a href="https://www.nerdwallet.com/blog/finance/how-to-build-credit/" target="_blank">build your credit score</a> so that you can qualify for a lower PMI payment. And as a result, you may even qualify for a lower interest rate and, therefore, a lower overall mortgage payment. 

<h3>Make an Informed Decision</h3>
There’s no right answer when it comes to how much you should put down on your mortgage. 

If you have enough for a 20 percent down payment, you won’t have to worry about the cost of PMI. But if you don’t have enough, it’s important to know how much it will cost you on a monthly basis and over the long run — or to know the alternatives available. 

For your specific situation, use an <a href="https://www.hsh.com/calc-pmi.html" target="_blank">online PMI calculator</a> to find out how much it will cost you. Knowing those figures will help you make a more informed decision for your mortgage. 

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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How Much Does PMI Cost?| Unison Home Co-Investing

<h3>How Many Quotes to Get and How to Save Yourself Thousands</h3>

If you’re about to score your dream home, figuring out a mortgage is the most stressful and often the most confusing part of the process. After all, you know you want quartz countertops, but do you know what the average current interest rate is? And did you know that not all mortgage quotes are created equal? There’s a lot to know about financing what may be the biggest purchase of your life, but putting in a few extra hours before you sign on the dotted line will pay off in the long run. 

In a recent interview with Unison, Terrance Odean, professor at the Haas School of Business at UC Berkeley, recommended getting no fewer than four mortgage quotes from four different lenders before committing to any of them. We’ll go over why multiple quotes are better than one and how to compare mortgages apples-to-apples, so you can be sure you’re getting the best rate.
 
Four Reasons to Get Four Quotes 
Really, the more quotes from different lenders you can get the better, but unless you have unlimited time to spend, four is a good number to shoot for. Here are a few reasons why it’ll pay to shop around before you settle down. 
 
1) Getting a quote won’t ruin your credit score.
Every time your score gets checked with a “hard” credit pull, it takes a small hit. However, credit companies are smart enough to recognize multiple inquiries for the same type of mortgage in a specific timeframe, so it won’t impact your score as much as applying for, say, multiple credit cards within the same week. To get more granular about how quotes can affect your score, take a look at TransUnion’s handbook.
 
We recommend the 4x4 rule: four quotes in four days. That’s because quotes can expire and rates can fluctuate, so keeping your window of exploration tight helps give you a good feel for the best rate. 
 
2) There are different types of loans. 
Getting creative with your financing can mean you're taking on extra risk, i.e. with an adjustable rate, or by increasing your payment with PMI if you have less than 20% to put down. A good broker will offer and explain options like a fixed-rate loan, an interest-only loan, an adjustable-rate mortgage (ARM), or a jumbo loan. And even those have options like 30 or 15 years or splitting up one loan into two to get a better interest rate. The important thing to remember here is that brokers can offer different solutions depending on your situation, so do some research on your own and ask about different types of loans and how they’d work for you. 

3) APR isn’t your interest rate.
Interest rates fluctuate depending on what’s happening to the country’s economy and how good your credit score is. However, the APR is a broader umbrella that includes interest rate and the costs of actually borrowing money from a specific lender, such as closing costs and broker fees. You’ll likely see a greater variation in APR from lender to lender than you will a variation in interest rate from lender to lender.
 
4) The power of negotiation. 
In this situation, you can bargain hunt while you house hunt because you hold all the cards. Use all that bargaining power to your advantage. Play lenders against each other. Show one lender another quote and ask them to match or beat it. Ask for discounts on services or refunds after closing. What one company won’t do, another might, but you’ll never know unless you ask. 
 
Getting a mortgage is a big step, and it’s important to feel comfortable with the mortgage payment you’ll be making each month. By seeking out more than one mortgage quote, you can feel confident about the rate you’re getting and not spend the next few decades wondering if you could have gotten a better deal.

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Terrance Odean, professor at the Haas School of Business at UC Berkeley, explains how to shop smarter for a mortgage and save thousands on your home loan. 

Mortgage Quotes, How Many Do You Need? | Unison® Equity Sharing

Set yourself up for success by making home improvements before putting your home on the market. The first impression is everything, and easy updates add value and can make a home more desirable to home buyers in a competitive market. 

Simple upgrades can instantly validate a higher asking price and increase the resale value of your home. 

When you're going to sell real estate, opt for updates that offer a return on investment. The goal isn't to end up in Architectural Digest or be the most-liked home on Instagram. 

Secondly, consider the home's value in a seller's market. It could make sense to overinvest in the improvement because it will fix a major issue, or will set the home apart to potential buyers.

Home improvement projects and the value we associate with them is somewhat relative, especially when you're comparing the value-add of a coat of paint versus a new roof. 

Weigh the opportunity cost, your skill level, and make a judgment call on what improvements will increase your home's value. Consulting with a real estate agent to confirm the value of your home is a good idea, and whether to take out a <a href="https://www.unison.com/blog/how-do-home-improvement-loans-work/">home improvement loan</a>.

<h3>General improvements</h3>
Look closely at your home and flag the things that may be “easy” to update, whether in a bedroom, hallway, or main living space:
<ul>
<li>Paint trim and walls</li>
<li>Refinish old hardwood floors and deep clean carpets</li>
<li>Replace old light switches and outlets</li>
<li>Replace outdated light fixtures and ceiling fans</li>
<li>Make energy-efficiency updates to improve energy bills, such as improving insulation, installing a smart thermostat, or investing in window replacements</li>
<li>Minimize your belongings (it can help to accentuate the actual square footage)</li>
 </ul>
 
<h3>Kitchen improvements</h3>
While a kitchen renovation offers a significant impact and will increase the value of your home overall, it's not likely that you'll see recoup 100% of your investment when you sell.

The better option is to opt for a minor kitchen remodel, and make improvements that visibly update the look, without requiring a large investment in the space.
<ul>
<li>Update appliances with products that are modern and energy-efficient (you may even be able to bring these with you to a new house, but for showing purposes, they'll help the space look really nice)</li>
<li>Paint outdated cabinetry, or replace all of the cabinet door and drawer fronts with modern styles</li>
<li>Upgrade hardware</li>
<li>Replace countertops</li>
 </ul>
 
<h3>Bathroom improvements</h3>
A full bathroom remodel might add home value, but as with a kitchen remodeling project, it's not likely that you'll profit from the improvements. 

Replacing all of the tile, for example, is an expensive and laborious undertaking, and you risk choosing a style that might not appeal to a future buyer.

Instead, consider how it would look if you were to:
<ul>
<li>Upgrade an outdated vanity, or replace an old sink top</li>
<li>Replace an old toilet</li>
<li>Buy a new shower curtain and/or shower rod</li>
<li>Replace an old shower head</li>
 </ul>
 
<h3>Living room and family room improvements</h3>
Opt to make main living areas appear turnkey, organized and neutral to allow home buyers to visualize their own belongings in the space.
<ul>
<li>Install a new gas fireplace insert</li>
<li>Update an old fireplace with manufactured stone veneer</li>
<li>Have wiring for any wall-mounted televisions set up to route through the wall joists</li>
<li>Embrace natural light</li>
 </ul>
 

<h3>Curb appeal home improvements</h3>
Taking the time to enhance your home's curb appeal can pay off big. 

Routine maintenance, like sweeping sidewalks and washing the windows and siding goes a long way at making a home appear well-maintained, but in addition:
<ul>
<li>Paint the front door, and any other entry doors</li>
<li>Replace or paint an old garage door</li>
<li>Reseal an asphalt driveway</li>
<li>Stain a wood deck</li>
<li>Consider painting a brick exterior</li>
<li>Replace damaged siding</li>
<li>Prune trees and shrubs</li>
<li>Add mulch to garden beds</li>
 </ul>

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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These simple upgrades to your home can validate a higher asking price and increase resale value. Unison shares tips on which home improvement projects will give you the most bang for your buck.

Improvements to Increase Your Home's Value | Unison®

Private mortgage insurance (PMI) is a form of insurance home buyers pay on top of a conventional loan on a home. Generally, home buyers have to pay PMI if their down payment is less than 20% of the home's purchase price. 

Private mortgage insurance is an insurance policy that protects the lending institution (i.e., a bank) in case you stop making payments on your loan. It doesn't protect you, the home buyer, even though you make the PMI payments.

One of the greatest barriers to first-time homeownership is coming up with enough cash to cover a 20% <a href="https://www.unison.com/article/down-payment-guide-for-first-time-home-buyers">down payment</a>. But if you get a conventional loan for more than 80% of the home's purchase price, the lender will require you to pay for PMI.

That's because home buyers who want to make a low down payment are seen as a greater risk to the lender. PMI is intended to cover potential losses sustained by the mortgage lender if you fail to make payments. You also may be required to pay for PMI if refinancing results in having less than 20% equity.


<h3>How much is PMI on a mortgage?</h3>
While the cost of PMI typically ranges from 0.5% to 1% of the loan balance each year, many factors can influence your monthly payment. 

PMI costs are calculated based on these criteria:
 <ul>
<li>Down payment amount: if you pay 20% or more of the purchase price of your home as a down payment, you will not have to pay PMI. For down payment amounts of less than 20%, the PMI rate varies. </li>
<li>Credit score: The higher your credit score, the lower your PMI payments.</li>
<li>Type of mortgage: PMI is associated with conventional loans only.
The total amount of the mortgage loan: The more money you need to secure your new loan, the more PMI you will pay over the total life of the loan. </li>
<li>Loan-to-value ratio: The percentage of your home's value that was issued to you as a mortgage loan.</li>
 </ul>
 

To calculate your monthly PMI payment, multiply your loan amount by your PMI rate and divide the answer by 12. That's the amount you'll pay each month until you've built at least 20% equity in your home. 
 
While you can't generally negotiate PMI, you may be able to pay for your PMI upfront as a lump-sum. Some lenders may charge a higher interest rate instead of PMI. 
 
When comparing the cost of PMI to a higher interest rate, make sure to calculate the total you'll pay for each over the life of the loan. 
 

<h3>How can I avoid PMI?</h3>
Since PMI costs add to your monthly mortgage payment, it's understandable that you would want to <a href="https://www.unison.com/article/how-to-avoid-PMI-when-buying-home">avoid PMI</a>. Thankfully, there are ways to <a href="https://www.unison.com/article/how-to-get-mortgage-loan-with-no-PMI">get a mortgage loan without PMI</a>, even if you can't put 20% down: 
<ul>
<li>Take out an FHA loan. You'll avoid PMI even with a lower down payment, but other associated mortgage insurance premiums could end up costing you even more.</li>
<li>Take out a piggyback loan. A <a href="https://www.unison.com/article/what-is-a-piggyback-loan">piggyback loan</a> or 80-10-10 loan is a type of home loan that can help you avoid PMI, but could also end up costing you more if you don't have good credit.</li>
<li>Consider a VA loan if you are an eligible servicemember, spouse, or veteran.</li>
<li>Seek downpayment assistance. The U.S. Department of Housing and Urban Development provides downpayment and closing cost assistance to eligible low-income families that do not need to be repaid. </li>
 </ul>
 

If you don't qualify for any of these options, or you're worried about the cost of FHA and piggyback loans, look into home co-investments. 
 

<h3>Is PMI tax-deductible for 2020?</h3>
Thanks to a tax provision that was extended in 2019, PMI and other types of mortgage insurance premiums are deductible at least through the end of 2020. Interest on a mortgage up to $750,000 is also tax-deductible. 

Closing costs, on the other hand, are not deductible unless the associated costs are actually mortgage interest or real estate tax. 
 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Understand what private mortgage insurance is, how much it costs for home buyers, and how it's calculated.

Private Mortgage Insurance Explained | Unison® Home Equity Sharing

The problem with trying to save money is that there are just so many cool things to buy. It’s easier than ever to swipe your credit card at a store and leave with a new air fryer (or to just hit “add to cart” online), but this kind of casual consumerism can detrimentally impact your finances — especially if you’re managing debt while also trying to build your savings. 

Consumers in the U.S. owe a collective <a href="https://www.nerdwallet.com/blog/average-credit-card-debt-household/" target="_blank">$444 billion in credit card debt</a> and another <a href="https://www.lendingtree.com/auto/debt-statistics/" target="_blank">$1.16 trillion</a> in auto loans. We love our stuff, and the internet and accessible financing options make it easier than ever to acquire almost anything. But the consumer debt that often accompanies our purchases accumulates as a burden, demanding payment even when you have other places you’d like those funds to go. But is it smarter to pay off debt or to save? It depends.

<h3>Assess your circumstances</h3>
The first step to smart debt management is figuring out just how much debt — and what kind — you have. Credit cards, student loans, car payments, <a href="https://www.nerdwallet.com/blog/average-credit-card-debt-household/" target="_blank">medical bills</a>, a mortgage — they’re all different kinds of debt, but each comes with its own set of considerations and rules. If you have a credit card with 20% annual percentage rate (APR), which is the <a href="https://www.valuepenguin.com/average-credit-card-interest-rates" target="_blank">average</a> for cash-back cards, paying that off as fast as possible is going to save you more in the long run than putting your budget toward paying off a car loan with an APR of 5%. If you have a loan that provides a tax break, such as your mortgage or student debt, you might put a lower priority on paying off those than on debts that don’t get factored in at tax time.

Once you’ve identified and prioritized your debts, look at them in comparison to your monthly budget. What’s the maximum you can pay? Are there any extras you can cut, like multiple streaming services or eating out a lot? Getting a firm handle on your debts and resources is a necessary step to getting on top of your accounts and improving your financial health. 

<h3>Saving vs getting out of debt</h3>
Being in debt is <a href="https://www.thesimpledollar.com/credit/manage-debt/the-true-cost-of-debt/" target="_blank">expensive</a> and can build up quickly. As a general rule, the sooner you can get out of it, the more money you’ll save in the long run, and the faster you can put that portion of your budget into savings. According to numbers from the Bureau of Labor Statistics and U.S. Census Bureau <a href="https://www.nerdwallet.com/blog/average-credit-card-debt-household/" target="_blank">analyzed by NerdWallet</a>, U.S. households carrying credit card debt will pay over $1,100 in interest this year.

If the bulk of your debt is saddled with high interest rates, concentrating your efforts on paying off that particular account first will help you save more money in the future—even if it means <a href="https://www.daveramsey.com/askdave/debt/drain-savings-to-pay-debt" target="_blank">draining your savings accounts today</a>. Also, never settle for giving the minimum monthly payment if you can help it. But if you don’t have large, hungry accounts gathering rapidly growing interest, divide your efforts between paying off debt and building savings. If you’re able to put money away now, you can build up a rainy day fund that will help you avoid debt for unexpected expenses, helping to ease money-related stress and allow you to put down a larger down payment on a future house.

There’s another trick that many people don’t consider when trying to pay off debt, add to savings and increase their credit score, and that’s tapping into the equity of the home you already own with a home equity sharing agreement. With Unison’s HomeOwner Solution, you can unlock up to <a href="https://www.unison.com/homeowner_debt_relief" target="_blank">17.5% of your home’s value</a> without having to pay it back in monthly installments with additional interest. Instead, Unison is paid by sharing a portion of your home’s appreciated value when you sell it, or after 30 years. It’s a smart way to pay off debt just by putting your equity to work.

<h3>Don’t wait</h3>
If you can start hacking away at high interest credit card debt, that’s perfect. If not, make more modest progress on your debt while slowly contributing to your savings. Whichever way you choose, waiting to start won’t help you in the short term or the long run. Don’t make the mistake of assuming having debt now means you shouldn’t start thinking about the future. If you’re hoping to save for a home while also saving for retirement, getting your debt under control will help, but these goals don’t have to wait until you’re debt free. 
Likewise, if you’re considering buying a home, you don’t necessarily have to wait until you’re debt-free before checking out the housing market. If you plan on staying in an area with affordable real estate, you could be <a href="https://www.bankrate.com/real-estate/renting-vs-buying-a-home/" target="_blank">building equity</a> in a home — and your payments might not be much different than you would be paying in rent. Conversely, if you live in a more expensive area or don’t plan on settling down for a while, you might benefit from focusing on slashing debt and building a modest amount of savings for a <a href="https://www.moneycrashers.com/save-down-payment-pay-off-debt/" target="_blank">future down payment</a>. 

There’s no single solution to clear away debt, but making a concerted effort can chip away at that burden and help you build up your savings and assets for a brighter financial future. And if you’ve run the numbers and the budget makes sense, go ahead and get that air fryer. Just make sure you’re saving up and paying off debt, too.



 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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There’s not a single solution to deduce debt, but making a concerted effort to pay it off while building up your savings will help make homeownership possible. Unison shares tips on how to find debt relief.

Debt Reduction Strategies | Unison® Home Equity Sharing

We’re only human—sometimes we miss our bill due dates, possibly get charged a late fee, and then are more careful to pay it on time the next month. But what happens if you’re delinquent in paying something big, like your mortgage?

While foreclosure is always a possibility if you’re really late on a mortgage payment, how long does that take? If you’re just a few days late, will that affect your credit score at all?

<img src="https://contentimages.o-prod.unison.com/images/blog/pay_one_late_mortgage_payment-e1521658389100.jpg">

Let’s go over what happens when you’re late on your mortgage, and how to avoid it all costs.

<h3>What Happens If I’m a Few Days Late on a Mortgage?</h3>
Just like a rent payment, your mortgage payment is due on the first of every month. So, what exactly happens if you pay your mortgage after the due date? Should you expect a late fee?

If you only miss your payment by a few days, chances are that you won’t have any kind of late fee or reporting to the credit bureau (such as Experian or Equifax) because most lenders generally give you a “grace period.” You should contact your mortgage company to find out what your exact grace period on your home load is, but many lenders will give you 15 days to pay your mortgage without penalty.

However, just because it’s technically allowed doesn’t mean you should get into the habit of it.

“The 15th is described as ‘the bank has the check,’” says Theresa Sheridan, Senior Loan Officer in Seattle. “There are clients who wait until day 15 and call in their payment with a credit card. If a client spends all their money from their end-of-month check, they know they can wait until their check on the 15th and pay. This is a hard cycle to get out of once a client is in this habit.”

If you don’t pay your mortgage by that 15th day, then you can expect to incur a late fee (usually about 5% of your payment).

<h3>What Happens if I’m More than 30 Days Late on a Mortgage?</h3>
A late monthly payment after 15 days will result in a late fee, but a late loan payment after 30 days will result in even more consequences—like being reported to credit bureaus.

Missing a monthly mortgage payment by more than 30 days can drop your credit score, but the question is: How much can it drop? Well, this depends largely on your overall credit history as well as the scoring system that your particular lender uses. The drops also tend to be higher if you have an “excellent” credit score (780 or above) and have never missed a payment before.

However, even though you may get a ding on your credit score, the good news is that you most likely won’t go into foreclosure after just 30 days delinquency.

“Banks will go to great lengths to contact borrowers from the minute they are 15 days late,” Sheridan says. “Since the short sale/foreclosure boom, I think banks have learned that offering counseling or help lines for clients who are struggling is far preferable to having a client foreclose. Banks are in the business of lending money, not of owning real estate.”

<h3>What Happens if I’m More than 90 Days Late on a Mortgage?</h3>
When you are more than 90 days late on a mortgage payment, you are subject to your lender starting the foreclosure process. In most states, falling behind more than 90 days past due on your mortgage means that your lender can initiate the foreclosure process—starting with pre-foreclosure.

Pre-foreclosure begins with your lender recording a public notice (a Notice of Default) that you, the owner, have defaulted and they will mail this notice to you and might even be required to post it on your door.

After this, state law determines different waiting periods. Typically, you have 90 days from the Notice of Default to arrange payment to bring your payments up to date. If you still haven’t paid the payments you owe on your house, then your house may be put up for auction. In some states, the lender must file proceedings in court to complete the foreclosure process. The homeowner does have a chance in many states to stop the foreclosure process—otherwise known as the “right to redemption”—up until the home is sold at the auction. However, if they can’t come up with the money then the home will be sold to the highest bidder, and if it’s not sold at the auction it will become a bank-owned property.

<h3>How to Avoid Foreclosure and Late Payments</h3>
Obviously, no one wants to miss payments and go into foreclosure, but life is often unpredictable. You never know when you might lose your job or if someone in your family will have a pressing medical issue that becomes a huge financial burden.

If you are ever in a financial predicament and don’t think you’ll be able to make your mortgage payments, you do have some options—but only if you reach out to your lender. You could potentially qualify for a loan modification called a forbearance, which is essentially when a lender and an owner agree to lowered or suspended payments until the owner is back on their feet. There may also be government assistance programs available to help you bridge the gap in your payments or restructure your mortgage.

This doesn’t mean that you’re off the hook, however; you will still have to catch up on the repayment. The most important thing to remember is that you want to be the one reaching out to them and not the other way around.

But unless you are going through a financial hardship or extraordinary circumstances, you should be making your mortgage payments on time each and every month. To avoid making delinquent payments, Sheridan suggests to set up autopay, but also make sure to schedule it well ahead of time so you’re not cutting it too close.

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Due dates get missed, it's just part of life. But it's important not to make a habit of missing these deadlines, especially on payments as significant as your mortgage. Learn what measures banks can deploy if payments are not received.

Consequences of a Late Mortgage Payment | Unison®

If you're serious about home buying, you'll need to show the seller that you intend to go through with the purchase, assuming you secure financing and the home inspection goes as planned. That's where an earnest money deposit comes in. 

<h3>What is earnest money?</h3>
In a real estate transaction, "earnest money" is a good faith deposit given to the seller that indicates the buyer's intent to purchase a home. While earnest money is not necessarily required, most sellers won't go under contract without it. The amount of earnest money varies and is negotiable, but usually falls between 1% and 2% of the purchase price. In competitive markets, sellers might request more than that. 

Here's how earnest money deposits typically work:
<ol>
<li>The buyer delivers the earnest money when entering into a purchase agreement with the seller.</li>
<li>The seller takes the home off the market while it undergoes a home inspection and appraisal.</li>
<li>The earnest money is kept in an escrow account held by the title company or real estate brokerage firm.</li>
</ol>

Depending on the home buyer's ability to get financing and the results of the home inspection and appraisal, one of three things will happen next:
<ul>
<li>If the buyer proceeds with the home purchase, the earnest money is put towards the <a href="https://www.unison.com/article/down-payment-guide-for-first-time-home-buyers">down payment</a> and closing costs.</li>
<li>If the seller terminates the deal for any reason, or if the buyer backs out because of contingencies included in the contract, the earnest money gets returned to the buyer.</li>
<li>If the buyer decides not to purchase the home for a reason not provided for in the contract, the buyer forfeits the earnest money.</li>
 </ul>
<h3>Is earnest money deposited right away?</h3>
Usually, the title company will cash your earnest money check immediately to ensure you have the funds and don't spend the money on something else. 
 
You'll typically hand over a certified check when you sign the purchase agreement. Sometimes buyers will submit earnest money with their initial offer. Either way, you'll need to ensure you have the funds in your account to cover the amount. 

<h3>Can you get your earnest money deposit back?</h3>
Yes. Any breach of contract allows you to get your earnest money back from the escrow company. 

Examples of these scenarios:
<ul>
<li>The seller fails to deposit the earnest money.</li>
<li>The buyer is denied a loan for the home and there is a financing contingency in the contract.</li>
<li>The home appraises for less than the purchase price and the seller will not negotiate the price.</li>
<li>The home inspection reveals flaws that the seller refuses to fix and there is an inspection contingency.</li>
<li>The seller failed to disclose issues with the home that they were obligated to disclose.</li>
<li>The buyer can't sell their home in time, and a contingency provides for the buyer to back out.</li>
<li>The title search uncovers issues such as a lien on the property.</li>
<li>The seller walks away from the deal.</li>
 </ul>

Typically, the buyer and seller will negotiate resolutions to any issues that come up so that the sale can go through as planned. For example, if the home inspector finds that major repairs are needed, the buyer and seller can negotiate whether the purchase price will be reduced or the seller will fix the issues. 

<h3>When can the seller keep the earnest money?</h3>
You can always walk away from purchasing a home if you have a change of heart. However, you might lose your earnest money deposit if you're under contract. A seller can keep your earnest money for any of the following reasons:
<ul>
<li>You discover issues and want to back out after the due diligence period has ended.</li>
<li>You back out for any reason not listed as a contingency in your contract.</li>
<li>You don't close on time and your contract has a “time is of the essence” contingency.</li>
 </ul>
<h3>How to ensure you don't lose your deposit</h3>
Depending on the purchase price of the home you intend to buy, you could be forking over a lot of cash for your earnest money deposit. Here's how to make sure you don't lose that money:
<ul>
<li>Be sure the home is right for you before you sign a contract. Take as many walkthroughs as you need with your real estate agent to make sure you want the home. If you have a change of heart once you're under contract, you could lose your earnest money.</li>
<li>Make sure all necessary contingencies are listed in your contract. You'll need contingencies for the home inspection, home appraisal, and title search. Depending on your situation, you might also need contingencies for financing and the sale of your existing home. </li>
<li>Read the contract carefully and follow the terms. That includes making sure you get everything done by the deadline. If you take too long to schedule your home inspection, for example, you could lose your earnest money. </li>
</ul>

It can be scary to hand over money to a seller when so many variables are still unknown. As long as you abide by your sales contract, your earnest money will either go towards your down payment or be returned to you. 

And when you finally close and get the keys to the new home of your dreams, it will be well worth the anxiety that came with the home buying process. 
 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Earnest money is a good faith deposit given to the seller that indicates the buyer's intent to purchase a home.

Earnest Money Deposits Explained | Unison Home Equity Sharing

Lab results are a good measure of internal health. A personal trainer offers advice on muscular health. And a therapist can diagnose mental health.

But what's a good measure of financial well-being?

As a rule, mortgage lenders prefer a back-end ratio of 28% or lower. And 36% or less is an ideal front-end ratio. 

Let's unpack what these numbers mean.

<h3>What is a debt-to-income (DTI) ratio?</h3>

In the lending industry, the debt-to-income (DTI) ratio is one of the key indicators used to gauge financial health.

For banks and lenders, your DTI ratio is a snapshot of your financial situation. It gives them an idea of how well you manage your finances and how much of a monthly mortgage payment you can afford. A DTI calculation compares total monthly debt payments to monthly gross income.

<h3>Calculating your DTI ratio</h3>
When determining a home loan mortgage rate, most mortgage lenders required two separate DTI calculations: the front-end ratio and the back-end ratio.

<h5>Front-end DTI ratio</h5>

The front-end ratio is the percentage of your gross monthly income that will be used to pay housing expenses. You’ll also hear it referred to as the housing expense ratio.

There are typically four housing costs used to calculate front-end debt:
<ul>
 <li>Monthly mortgage payment</li>
 <li>Property taxes</li>
 <li>Homeowners insurance</li>
 <li>HOA dues</li>
</ul>
 
<h5>Back-end DTI ratio</h5>
Back-end debt includes two separate totals. The first is the total of all monthly payments in the categories that appear on a credit report:

<ul>
 <li>Mortgage payment or rent payment</li>
 <li>Auto loan payment</li>
 <li>Personal loan payments</li>
 <li>Student loan payments</li>
 <li>Alimony and child support payments</li>
 <li>Credit card debt in the form of minimum credit card payments</li>
 <li>Monthly minimum payment on a home equity line of credit (<a href="https://www.unison.com/article/how-to-qualify-for-heloc">HELOC</a>)</li>
 <li>Other monthly debt payments included on your credit report</li>
</ul>

To complete the back-end ratio calculation, add your total monthly payments from the list above to your total front-end debt. This figure, represented as a percentage, is your overall DTI ratio. A high DTI ratio informs lenders that too much of your income goes toward your total monthly debt and that it may be risky to offer you a new loan.

Which brings us to the big question: What is a good debt to income ratio? 

<h3>The ideal debt-to-income ratio</h3>
As mentioned above, mortgage lenders like a back-end ratio of 28% or lower. And 36% or less is an ideal front-end ratio.

Depending on the type of qualified mortgage you apply for, these ranges may change. For example, Fannie Mae- or Freddie Mac-backed conventional loans may allow for a higher DTI ratio—up to 50%, in some cases. The borrower must have excellent credit, sizable assets and substantial <a href="https://www.unison.com/article/down-payment-guide-for-first-time-home-buyers">down payment</a>.

With Federal Housing Administration (FHA) loans, home buyers with a higher DTI ratio often qualify for more competitive interest rates if their credit score is 620 or better. VA loans are even more generous. The maximum allowable back-end ratio increases to 41% and front-end ratio calculations are not required.

If you're confident that your DTI ratio meets the parameters for a qualified mortgage, the next step is to determine your down payment. 

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

hoyoung-choi-IZLkf1771lY-unsplash

Understand what's considered a good DTI ratio, how it's calculated, and how it helps you buy a home.

What is a Good Debt-to-Income Ratio? | Unison

By Lauren Rosales-Shepard, Content Writer

 The older population in the United States is greatly increasing, with the number of seniors (those 65 or older) <a href="https://www.prb.org/resources/fact-sheet-aging-in-the-united-states/">expected to almost double</a> by 2060. Life expectancy, too, has climbed. As a result, a growing number of homeowners find themselves en route to retiring into a conundrum: do I stay in my home and age in place, or do I downsize? 


 The pros and cons of each option seem at first obvious. If you downsize to a smaller home, you will have much less space to maintain (especially yard-wise!). On the other hand, if you stay in your home and age in place, you’re in your home–you know the space, the community, already. Downsizing requires moving, and when has that ever been anyone’s idea of A Good Time? But your current home is full of empty rooms, now that your children have grown up and flown the coop; it can be lonely. 


 It’s a tremendously weighty decision. Like any life-altering choice, there are complexities to consider, and there is no one-size-fits-all solution. 

 Downsizing

 If the members of your household have dwindled to two or one, you would undoubtedly embrace being responsible for less space. You would have fewer rooms to clean if you downsized, not to mention less (if any) yard to mow and rake. Plus, were you to relocate, you might possess the luxury of choice–without needing to be near a job, you could choose to be near family, or in a more appealing climate, for example. 

 

 Homeowners who look to relocate into a smaller autonomous home may, however, run into severe cost issues. Purchasing a home in today’s market will subject one to skyrocketing mortgage rates amidst <a href="https://www.aarp.org/money/budgeting-saving/info-2022/inflation-biggest-price-increases.html">ever-rising inflation</a>. Both of these factors may make it more difficult for you to sell your current home for the funds to purchase a new one—that is, if you can even find one! There is a extreme <a href="https://www.npr.org/2022/03/29/1089174630/housing-shortage-new-home-construction-supply-chain">housing shortage</a>. In addition, there is an even more blatant scarcity of smaller homes, as they are simply <a href="https://www.cnbc.com/2018/09/11/baby-boomers-are-struggling-to-downsize--and-it-could-create-the-next-housing-crisis.html">no longer being built</a>. But seniors who would be open to apartment-living (no yard!) face an obstacle, too: the paucity of multifamily housing. Nationwide, there is <a href="https://www.theatlantic.com/ideas/archive/2022/06/zoning-housing-affordability-nimby-parking-houston/661289/">very little zoning that permits</a> multifamily housing to be built. Zoning often not only prohibits multifamily dwellings in particular, but also might <a href="https://www.pewtrusts.org/en/research-and-analysis/blogs/stateline/2022/03/15/as-rents-soar-states-take-aim-at-local-zoning-laws">limit the heights of buildings</a> and include minimum lot-size and square-footage requirements. Those apartments that can be built tend to be luxury condos, or publicly-subsidized low-income housing–nothing in the middle, which is often the space that seniors on a fixed income would financially occupy. 



 Similar dynamics exist in the senior living industry, which is continuously innovating to present desirable options to aging adults of means. Senior living facilities often put on social events, and promote opportunities for residents, however independently they are able to live, to meet, mingle, and form friendships. This is great news for one’s health, as social isolation and loneliness frequently have deleterious effects on seniors–indeed, the related health risks are <a href="https://www.artandhealing.org/older-adults-loneliness-fact-sheet/?gclid=Cj0KCQjwqoibBhDUARIsAH2OpWh5t2hl_mi5ohmU1IgZHO3I5mXY_g-URXE6l9UmlNVGESIwHO9WEbwaAv5GEALw_wcB">comparable to that of smoking and obesity</a>! Frequent social interactions can <a href="https://www.dementiacarecentral.com/caregiverinfo/handsoncare/socialization/#:~:text=Social%20interaction%20is%20healthy%2C%20like,more%20exercise%2C%20and%20better%20sleep.">slow symptoms of dementia</a> in aging adults. 

 

 A <a href="https://www.nytimes.com/2022/07/19/business/senior-housing.html">recent New York Times article</a> describes a recently-developed “luxury senior living community” featuring five restaurants, an outdoor pool, landscaped courtyards, highly-trained wellness staff, and an on-site “care coordinator.” The proximity of so many necessities and amenities alike are especially enticing to not only the <a href="https://aginginplace.org/aging-in-place-vs-assisted-living/">50% of seniors</a> who don’t believe their community has reliable or effective public transportation, but also the more than <a href="https://aginginplace.org/aging-in-place-vs-assisted-living/">25% of older adults</a> in their 60s who fear their communities don’t have the resources they will need as they age.



 Unfortunately, however, the level of comfort and security ensconced in a development like the one mentioned in the article does come at considerable cost. Monthly rental rates at that particular abode range from $7,900 for a simple studio to $16,660 (and up!) for two-bedroom apartments. And although there are less extravagant options (the same article mentions a development where residents will volunteer for 10 hours each month to cut down on costs, for example), even these require an upfront payment of hundreds of thousands of dollars in addition to monthly rents. While this level of wraparound support in a housing arrangement might be the ideal scenario for many seniors, it also might not be a realistic option for many homeowners looking to downsize.


 Aging-in-Place 

 According to AARP surveys, 90% of seniors (65+) <a href="https://www.aarp.org/livable-communities/about/info-2018/aarp-livable-communities-preparing-for-an-aging-nation.html#:~:text=A%20conundrum%20we%20face%20is,and%20their%20doctors%20know%20them.">want to age in place</a>–in other words, to remain in their current homes. The main reason for this preference is a desire for <a href="https://academic.oup.com/gerontologist/article/60/1/50/5272551">social connectedness</a>; those who are already familiar with and active in their communities do not want to lose that built-in social network. Although many assisted living facilities, retirement homes, and luxury senior living developments do feature social activities and engagement, it is daunting for anyone to start from scratch and facilitate new friendships. It can be even more difficult for an aging individual who is more likely to <a href="https://gero.usc.edu/students/current-students/careers-in-aging/the-value-of-aging-in-place/">want to cling to the familiar</a>. 


 Familiarity is also key to a sense of agency and independence. While a new neighborhood could be difficult to navigate, if one were to age in place it might be easier to satisfy the basic needs–groceries, clothing, appointments, etc–without help. Access to affordable transportation options <a href="https://t4america.org/docs/SeniorsMobilityCrisis.pdf">tends to be scarce</a>, and so those aging adults who cannot or do not drive themselves become isolated and are far less likely to take active steps for self-care. Those who opt to age in place frequently do so because it seems like the best way to <a href="http://ojs.westeurope.cloudapp.azure.com/Notebooks/article/view/200/175">maintain their autonomy</a> for as long as possible. 



 There are <a href="https://www.habitat.org/our-work/aging-in-place">significant factors</a> to take into account when considering aging in place. Do you foresee yourself needing assistance with activities of daily living? Will you require help with chores and additional home/yard maintenance? Even if you don’t think that either of these possibilities belong to the near future, it’s important to make a plan just in case. This plan can include at least budgeting for various potential <a href="https://eldercareguide.com/home-modifications-and-repair/">home modifications</a>, as well as for services you may later need–lawn care, snow removal, grocery delivery, dog-walking, routine in-home medical care, etc. If you live in a two-story house, you should be especially cognizant of the <a href="https://seniorsafetyadvice.com/how-to-make-a-two-story-house-elderly-accessible/">potential renovations</a> that you may require: installing or tightening handrails, placing extra lighting and non-slip material on the stairs, even installing a lift in case of extreme loss of mobility. <a href="https://dailycaring.com/home-modifications-for-seniors-a-room-by-room-guide/">Bathroom renovations</a>, in particular, may need to be extensive. You may want to consider whether it is possible to relegate your daily life to the main floor alone, as well. 

 There are many resources available to seniors who wish to age in place. Habitat for Humanity, for example, has an <a href="https://www.habitat.org/our-work/aging-in-place?gclid=Cj0KCQiAmaibBhCAARIsAKUlaKRxw7ymByzx7mL_HWPxr_YUDKWUZAlThpDO7Zexa6lHHoMmDkmyABsaAqs7EALw_wcB">Aging in Place program</a> that collaborates with human services organizations to help provide home repairs and modifications to the homes of seniors. USAging is the national association that represents the nationwide network of Area Agencies on Aging; they have many resources for <a href="https://www.usaging.org/transportation">transportation</a>, <a href="https://www.usaging.org/elderjustice">elder justice</a>, <a href="https://www.usaging.org/caregivers">caregiver supports</a>, and <a href="https://www.usaging.org/content.asp?contentid=1281">referral assistance</a>. The <a href="https://eldercare.acl.gov/Public/Index.aspx">Eldercare Locator</a> is also a public service provided by the U.S. Administration on Aging, and features a hotline fielded by specialists who can answer questions and connect seniors to resources in their communities. Individual states have specific resources that can usually be found by searching their Health and Human Services websites, too. If you have extra space and are worried about getting lonely, third-party services exist that can even help you find a compatible housemate! 

 An important consideration for anyone considering retirement is the affordability of housing. The Urban Institute recently reported that most older Americans are <a href="https://www.urban.org/urban-wire/middle-income-seniors-face-gap-housing-and-health-supports">woefully unprepared</a> to pay for their living expenses once they retire. Because the number of senior homeowners who have mortgages has <a href="https://www.urban.org/research/publication/what-2016-survey-consumer-finances-tells-us-about-senior-homeowners">nearly doubled</a> since the late 1980s, and those mortgage balances have been sharply increasing, retired seniors frequently find themselves with monthly payments with which they simply cannot keep pace. Imagine adding the cost of necessary home modifications to those already encumbering costs. 


 One solution to this problem is for aging homeowners to <a href="https://www.urban.org/urban-wire/american-seniors-prefer-age-place-whats-right-place">tap their home equity</a>. As the Urban Institute points out, however, many of the vehicles with which seniors can do this are less than ideal. Home Equity Lines of Credit (HELOCs) merely add to a homeowner’s burdensome list of monthly payments, and because many have variable rates, the interest can unexpectedly and drastically increase. Cash-out refinances can be risky, too, due to interest rate increases–plus, they require an income to support the mortgage debt. 



 However, a <a href="https://unison.com">Unison</a> equity sharing agreement neither requires monthly payments nor incorporates interest. Qualifying homeowners can receive up to 17.5% of their home’s current value in cash, or up to $500,000. Rather than monthly payments, the homeowner pays back the original amount, plus a percent of the home’s change in value, when the home is sold. A recent survey of Unison homeowners found that the two most popular uses of their agreements was to consolidate (or eliminate) debt, and to renovate their homes. The savvy planner looking ahead might see both of these as key components to preparing one’s home and finances for aging in place. 



 The most important thing to consider is what works best for you. There is no one right answer for everyone. Aging-in-place may be statistically popular, but <a href="https://www.sciencedirect.com/science/article/pii/S0890406520300402">not all places are suitable</a> for that plan. You must think of your own priorities, financial situation, as well as health profile to make the most logical, beneficial decision. Be sure to talk to your doctor, your family members, and your heirs to gather the most relevant and informed perspectives. 



 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Planning for retirement is stressful, and with life expectancy climbing for seniors, a key decision must be made: does one downsize, or try to age in place?

Downsizing vs Aging-in-Place: Considering Retirement

It’s difficult to think about retirement while you’re still paying off student loans. But for many of us, retirement is only a decade or so in the future, and the safety nets that once existed to supplement retirees’ incomes are quickly disappearing. That’s why Americans are rethinking retirement and getting smarter about planning for it. Unison conducted a survey of American homeowners to learn what they’re doing to prepare for retirement and how their homes factor into that planning.
<h3>What lies ahead</h3>
Almost half (48%) of American homeowners say they plan to retire in their 60s. Another 9% plan to do so during their 50s and 22% say their 70s. For a 30-year retirement at $40,000 per year, that equals about $1.18 million (using average returns of 6% and inflation at 2.5%). That number is a mystery to the one in five homeowners who don’t know how much they need to have saved by the time they retire in order to feel secure and live comfortably. Not having a savings goal in mind ahead of time means homeowners are more likely to miss the mark.
In fact, the amount Americans have in savings indicates they don’t understand how much retirement costs: 47% of American homeowners have currently saved around $250k or less, and 35% say they would be comfortable with amounts less than $750k total saved by the time they retire. That would mean trying to live comfortably on less than $20k/year, factoring in inflation.
For those already retired, social security could be expected to fill in the gap between savings and living expenses but social security might not even be enough to cover rent. That’s a sobering thought, considering that 70% of American homeowners and 50% of millennial homeowners are planning to fund their retirement via social security. Alright, let’s assume social security isn’t an option and you haven’t saved quite enough to be able to retire and live comfortably: that’s what a house is for, right?
Maybe. 
<h3>Making moves </h3>
Many of us have parents whose homes have doubled or tripled in value since they were first purchased. If, for instance, your parents bought a home in the Bay Area in the 70s, that home is likely worth over a million dollars now. But it would be impossible to sell that home, buy another smaller home in the area at market rate and still have enough to support their retirement. They’re sitting on equity they can’t access in a home that’s rapidly becoming a burden as the home ages.
That’s a common scenario: the vast majority of American homeowners (90%) think of their home more as a financial asset than a financial burden, and 25% of homeowners plan on using their home to fund their retirement. In fact, a quarter of American homeowners say more than half their total net worth is tied up in their home. The data states that the American home is an important part of overcoming shortcomings in other forms of retirement savings.
How do homeowners plan on using their homes to fund their retirement? By moving. Among those planning to sell their home to fund their retirement, 38% say they’ll move to a less expensive area with a lower cost of living. That’s a drastic change to bank on making in the future, especially when there’s no knowing what the market will be like twenty years from now.
<h3>The riskiest part of your portfolio</h3>
Homeowners place emotions first: the emotional value homeowners see from its role as a place for family to come home and gather (34%) and memories made in the home (31%) take priority over their home’s monetary value. But when your home makes up the majority of your overall financial portfolio, it should be viewed as a financial asset out of necessity. And there’s no telling if your home will appreciate or depreciate when it comes time to sell it and fund your retirement.
That’s a risk, especially because 70% of homeowners think their house will be worth more by the time they retire. If the home they’re banking on to fund their retirement suddenly drops in value, it will delay retirement for 39% of homeowners.
Homeowners need to have a contingency plan to fund their retirement; recessions don’t happen often, but they do happen, and poor timing could ruin retirement for hundreds of thousands of Americans.
<h3>Outsmarting Equity </h3>
So, what is the smart solution people are turning to to plan for retirement with all these unknowns? It’s accessing the equity in your home without going into further debt.
Unison provides an alternative solution that allows homeowners to convert up to 17.5% of their home equity to cash. It’s a solution that allows homeowners to utilize home equity without interest or monthly payments. Current solutions such as HELOCs and home equity loans involve borrowing money from your equity, which requires monthly repayments with interest and fees to repay the money lent to you.
That means homeowners can use that cash to supplement their retirement savings and maintain their standard of living for years to come. And when the time comes to move (up to 30 years later), Unison shares in the appreciation and, in most cases, the depreciation of your home.
Retirement should be something to look forward to: a time of relaxation and reflection rather than procrastination and panic. With Unison’s solution to smarter equity, it can be.
 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Our latest research investigates how Americans are planning on using their homes to fund their retirement. Check out how our findings can help you hack your equity and prepare for the future.

Retirement Planning with Home Equity Funds | Unison

Buying a home isn't always a straightforward, linear process, but it's easier to achieve homeownership when you know what you're getting into and can anticipate the next move. In a competitive market, it's especially important to be one step ahead. 

Get your finances in order, have a realistic expectation of what you can afford, and know which trusted professionals will add value and help you navigate the path. Get ready to go-go-go.
<h2>Steps to Buy a House: Home Buying Guide</h2>
Whether it's your first home or you just need a refresher, it's important to remember all that goes into the planning and the home buying process.
<ul>
<li>Determine what you can afford. Understand your personal finances and be realistic about your budget. Avoid the temptation to look at things outside your top amount.</li>
<li>Prepare a down payment. Bump up your savings and crunch your numbers. If you can't afford 20%, learn more about loan options and home co-investment opportunities.</li>
<li>Get preapproved for a mortgage. Get a bank's preapproval to prove to yourself—and to a seller—that you are a serious buyer who is qualified to purchase a home within a certain price range.</li>
<li>Find a real estate agent. Get referrals, and meet with real estate agents until you find one you trust.</li>
<li>Find a home. Explore homes in your price range, and schedule visits to see them in person.</li>
<li>Make an offer. When you find your dream house, work with your real estate agent to put in a formal offer.</li>
<li>Get a home inspection. A home inspector will help you identify any issues with the home, or validate that it's in tip-top shape.</li>
<li>Get a home appraisal. An appraisal will be required by the bank to measure the value of the home.</li>
<li>Get into escrow and complete paperwork. Set up a third-party account to hold your initial earnest money deposit, loan documents, deeds, and anything other documentation related to the settlement of the home.</li>
<li>Close on your new home and move in. Sign the official documents, make final payments, and get the keys to your new house.</li>
<h3>Glossary of Important Homebuying Terms</h3>
You'll hear things like: escrow, earnest money, private mortgage insurance, down payment, home equity sharing agreement and mortgage payment.

Buying a home comes with learning a whole new vocabulary. Learn what these terms mean and why they're important in our <a href="https://www.unison.com/article/first-time-homebuyer-definition-guide">First-Time Homebuyer Definitions Guide</a>.

Now, let's dive in...

<h3>1. Determine how much you can afford</h3>
Determine an affordable price point by diving into your personal finances. In addition to your own budget, consider the cost of homes in your area to know what is realistic. 

A total mortgage payment should be less than 35% of your salary (or roughly ⅓). If you earn $60,000 each year, your monthly mortgage payment should be no more than $1,750.

If you currently pay rent, consider what type of home that monthly payment might afford you. Use an online mortgage calculator to factor in property taxes, <a href="https://www.unison.com/article/how-much-interest-to-pay-on-mortgage">interest rates</a> (adjustable rate or fixed rate), and homeowners insurance. You might just find that a rent of $1,750/month can translate to a $200,000 house in some markets. In other markets where property taxes are very high, that same $1,750 monthly rent payment might only afford you a $100,000 house.

Research the median price point in your area. If you're looking for a 4-bedroom/3-bathroom home in the suburbs, the price point likely looks a lot different than comparable space in a popular metro area. Tax fluctuations from town-to-town can also greatly influence how much home you can afford in each area. Doing your research will set expectations.

<h3>2. Prepare a down payment</h3>
Having a <a href="https://www.unison.com/article/down-payment-guide-for-first-time-home-buyers">down payment</a> influences many aspects of the process, including loan eligibility and the overall cost of that loan. Save as much as you can to reach the goal of having at least 20% of the home's sale price as a down payment. Stick to a savings plan, cut back on expenses and save your tax returns to achieve the largest down payment possible. 

If you can't afford a <a href="https://www.unison.com/article/10-percent-versus-20-percent-down-mortgage">20% down payment</a>, never fear. There are many first-time homebuyer programs and other finance products available to help alleviate the stress of saving for a down payment and make homeownership a reality.

Government-backed programs such as VA loans and FHA loans make it possible for certain home buyers to purchase with 0–3% of the home's value, meaning that very little cash is required upfront.

A <a href="https://www.unison.com/how_it_works_homeowner">home equity sharing agreement</a> can also make it easier to find the money you need for a 20% down payment.

When you are aligned on how you can get to a 20% down payment for the price home you are looking to buy, you're ready to move on to the next step.

<h3>3. Get preapproved for a mortgage</h3>
A free mortgage pre-qualification from a mortgage lender proves that you're financially prepared to find your home. The mortgage broker will ask to see your proof of income (such as pay stubs and tax records), debts (such as auto loans and student loans), and proof of assets to confirm your debt-to-income ratio. Once they review your qualifications, you'll be able to secure a mortgage pre-approval for a specific loan amount. 

When house hunting, being pre-qualified for a home loan shows the seller and their agent that your intent to buy is serious and not spontaneous.

You can make an offer on a house without a mortgage preapproval, but an offer contingent on financing is less favorable.

Avoid making large purchases or withdrawals while you're in the home buying process, and pay off all credit card debt. Fluctuations in your credit report and credit score will come into question with the lender.

<h3>4. Find a real estate agent</h3>
It's best to work with a real estate agent that you vibe with, so get referrals and shop around. If you first find a lender, they may also be able to refer you to a real estate agent. Selecting a representative is a personal decision, but be sure that your chosen real estate agent is easy to communicate with, available on your schedule, and committed to helping you with your home search. 

Real estate agents don't make any money until the home is sold, so it's in their best interest to help you navigate the process. Commissions are commonly calculated at 6% of the sales price, broken down as 3% for the seller's agent, and 3% for the buyer's agent.

If the sale falls through before closing, the real estate agents are usually compensated by the earnest money down payment held in escrow.

<h3>5. Start looking for a house</h3>
With your preapproval letter and representation, it's time to dive into the real estate market. Share a home buying checklist with your real estate agent so you're both on the same page. Include general specifications that define your perfect home and neighborhood.

Example of these preferences: 
<ul>
 <li>School district of choice</li>
 <li>Property size</li>
 <li>Neighborhood characteristics</li>
 <li>Traffic</li>
 <li>Walkability</li>
 </ul>

Scour online listings, and search for open houses. Be quick to alert your agent when you find a home that you like, and schedule a time to see it in person as soon as you're able. 

In many markets, it's not uncommon for multiple offers to be made on a house the same day it goes up for sale, so time is of the essence if you want to compete with other buyers.

You may also find that the homes you gravitate to online don't check all the boxes when you see them in person. If this is the case, let your real estate agent do some research and make other recommendations. Changing the search criteria ever-so-slightly can open up a world of new opportunities.

<h3>6. Make an offer</h3>
You found your dream home. Your real estate agent is standing by to help you through the process of submitting a purchase offer.

You can also make an offer if you aren't represented by a real estate agent by using an online form to guide the general terms of your offer. It's always best to rely on a real estate attorney to review an offer before presenting it to catch any glaring inaccuracies or make recommendations to make your offer even stronger.

If you're preapproved for a home purchase, you will know what type of loan you are looking to secure and will share this information with the seller in your offer letter. 

Let the seller know what contingencies, such as a home inspection or closing schedule, need to be considered. In the offer letter, you state that your offer must be reviewed and accepted by a certain date. No one likes waiting indefinitely, so it's normal to request feedback within 3–5 days.

If you aren't preapproved, the seller may not consider you a serious buyer. One way to bypass the preapproval is to get creative with your offer by reducing contingencies or showing the seller that you have a substantial deposit of <a href="https://www.unison.com/article/how-does-earnest-money-deposit-work">earnest money</a> with a notarized bank statement.

How do you know what price to offer? It's difficult to know whether to offer more or less than the asking price. Have an understanding of your competition, the price of the home relative to its assessment and other comparable properties in the area. Both your real estate agent and loan officer can help you justify the purchase price you offer.

If it's a buyer's market, don't be afraid of throwing out a low offer price.

In a seller's market, you may need to go higher than the list price, but that's when understanding the comps comes into play. Use public information about similar (comparable) homes that have recently sold in the same area to validate the amount you decide to offer.

Also, be prepared for a counteroffer from the seller. A counteroffer is your opportunity to try again—you can accept their modified terms or try to compromise to reach a sale agreement. You may need to use this counteroffer time to look into other options such as a different type of mortgage or a home equity sharing agreement.

<h3>7. Get a Home Inspection</h3>
After your offer is accepted, you'll have a short window in which to schedule your home inspection. The inspection, performed by a qualified third-party, is a walk-through to confirm the condition of the home and flag any potential problem areas. 

Areas a home inspector will check:
<ul>
<li>Hot water tank and system</li>
<li>Electrical system</li>
<li>Roof</li>
<li>Foundation</li>
 </ul>

Expect the inspection of the property to take a few hours, because they are thorough. 

The buyer can choose to use findings of the report to counteroffer, or ask for repairs before closing.

<h3>8. Get a Home Appraisal</h3>
Separate from a home inspection, a lender will send an appraiser to the home to value its worth. This secondary property review will also take upwards of a few hours. 

The reporting from the appraiser allows the bank to determine whether the amount they're lending is fair. They need to know that if you default on your loan, they'll be able to sell the property for enough to break even on their investment. 

This reporting is also helpful for a buyer, as any expected improvements will be outlined. Depending on the type of home loan you are getting, improvements can be mandatory before closing. If the improvements are incomplete, the lender may choose not to finance.

The amount you're paying is in line with the property's value, all parties involved will work to confirm a closing date.

<h3>9. Escrow & Paperwork</h3>
The escrow account is a neutral place to store earnest money down payments and legal documents such as property deeds while the home sale is in limbo. The buyer will choose the escrow company, but the seller is also required to add items into the account prior to closing.

In the weeks and days leading up to closing, the loan officer will monitor your finances and alert you if you aren't going to have the cash available to close. If you need a small loan to cover a shortage, they will help you understand what your options are, from a personal loan to a bridge loan. 

Before closing, you'll also have time to review the closing costs as outlined in a Closing Disclosure. Compare it to the loan estimate you received, and make sure that it factors your down payment for earnest money deposits, the correct interest rate, and any credits offered by the seller. Be sure that you check the amount you're required to bring to closing.

Once you're sure that the calculations are correct, work with the bank to get your payment ready. These costs will be paid at closing. You can offer a certified check, cashier's check, or arrange a scheduled wire transfer. In some areas, buyers can use personal checks or credit/debit cards. But they are not as secure and not as readily accepted.

<h3>10. Close & Move-In</h3>
When the day of closing arrives, you'll meet with your real estate attorney or closing agent to complete the paperwork. They'll walk you through the terms of the agreement, accept any payments that you are required to deliver, and have you sign and date on so many lines, you simply won't believe it. Prepare for the closing process to take one to two hours.

At that point, the real estate attorney will give you the keys to your new house. That home is officially yours!

Assuming that your closing was simple and the previous owners have already moved out of the space, you can safely pack that moving truck and relocate your belongings into your new home. 

Buying a home is not simple, and it's an accomplishment you should celebrate. Congratulations! 
 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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From getting a mortgage to getting the keys, we walk you through all the major steps of buying a house.

Home Buying Guide: Steps to Buying a House | Unison

The Welcome Tower, a temporary public art installation, is a 30-foot tall reconceptualization of one of the most iconic symbols of San Francisco, Coit Tower. The Welcome Tower explores the relationship between the historic identity of San Francisco as a home to all, and the current challenges of rising costs to live here. The piece is a statement to inspire how we can reimagine, rebuild and reinvent homeownership. The art installation demonstrates the celebration of San Francisco’s community of dreamers, inventors and artists using reclaimed solid wood front doors from residences throughout San Francisco’s neighborhoods.

 
<img src="https://contentimages.o-prod.unison.com/images/blog/Welcome+Tower_hero+2.png" alt="San Francisco's Welcome Tower" style="width: 80%">
 

For the better part of the last century, San Francisco has been a hub for culture, art and freedom of expression, not just for our nation but the world. And our evolution continues as we have welcomed creators and inventors to help us become the tech center of the world. While magical and impactful, this evolution has resulted in skyrocketing property values. And we need new solutions.

 
<img src="https://contentimages.o-prod.unison.com/images/blog/Sean+Orlando_hero+1.jpg" alt="Sean Orlando" style="width: 80%">
 

Welcome Tower is a collaborative piece by the Bay Area arts community with lead artist Sean Orlando working alongside a diverse group of local steelworkers, fabricators, carpenters, gilders, decorative painters, sculptors, and muralists - just some of the many people that give San Francisco it’s unique voice.

 

Unison, a home co-investment company, is one local business pioneering innovative models revolutionizing pathways to homeownership in cities across the US. Unison’s headquarters are in San Francisco’s Financial District and is the sole funder commissioning this art piece. Through this gift to the local residents - Unison hopes to bring awareness to the challenges facing communities in the bay, inspire the next generation of creative problem solvers, and reaffirm our belief that the soul of this city should be an open door to everyone.

Welcome Tower 2019 Becca Henry Photography 1077

The Welcome Tower is a collaborative piece by the Bay Area arts community. Unison is the sole funder commissioning this art piece and hopes this installation will bring awareness to the challenges facing communities in the bay area.

The Welcome Tower - San Francisco Public Art Piece | Unison

Thinking of renovating your space or just moving to a more suitable home all together? You’ve got your work cut out for you! Both options are considerable investments and require some serious decision making. There’s a lot to contemplate, from finances to your current lifestyle, so things can get stressful quickly. Luckily, we are here to help narrow down your options and give you more clarity on whether you should renovate or buy your dream home! 
 
<h3>The Finances</h3> 
For starters, we need to cover two crucial loans that assist in deciding whether home renovating or home buying is the right option for you – a new mortgage loan or a home equity alternative.

 What is a mortgage loan? 

If you are a current homeowner, you likely know the basics of obtaining and utilizing a mortgage loan. Mortgage loans finance property using the home as collateral to ensure a mortgage lender is secure in their investment in the case an individual ceases to provide a minimum payment balance due at the end of each month. 

There are a diverse set of mortgage loans that are made available to create more accessibility for varying lifestyle demands. From conventional loans to VA loans, each comes with its own list of pros and cons, and what is best for you may not be what’s best for your neighbor. 

Part of the moving process is assessing your current mortgage loan and comparing it to a new one you may qualify for. For example, when you were a first time home buyer <a href="https://www.rocketmortgage.com/learn/fha-loans" target="_blank">you may have used an FHA loan</a> which typically has low interest rates. Then, when you apply for a new loan you may suffer from current, higher interest rates. It’s all dependent on your unique financial situation, career, and if you’re a first-time borrower.


 What is a home equity loan?

So, what exactly is a home equity loan? This type of loan is specifically for people who have built equity by paying off the principal of their mortgage loan. These loans are a second loan and not a refinance of your current mortgage. When you are approved for a home equity loan, you will receive a portion of your owned equity in one lump sum of cash. You are then free to spend the money as you see fit, whether it’s to pay outstanding medical bills, college tuition, or to pay for new home renovations.
 
<h3>Your Lifestyle</h3>
Your lifestyle has an effect on the list of necessities for your home, with functionality often being the catalyst to change your space. From having enough room for your family, to having an office space suitable to work remote, to even your hobbies, your home needs to be the right space for you! We have compiled a list of pros and cons to consider for both renovating and moving to help determine which option best fits into your current lifestyle and meets your needs:

 Renovating Pros 
<li>You can make your current home adapt with lifestyle changes</li>
<li>Remain in a community and school district you love</li> 
<li>No stress of selling your house and moving</li>
<li>Often times (but not always) more cost effective</li>
 Renovating Cons 
<li>Living in a construction zone for a while</li> 
<li>Surprise expenses are likely to pop up making it difficult to budget for</li>
<li>You’re at the mercy of a contractor</li>
<li>You may find you lack the space to make the changes you need</li>

 Moving Pros 
<li>You get a fresh start</li>
<li>Move to a more desirable area</li> 
<li>You can purchase a move-in ready home with no work to be done</li>
<li>Can grow with changing lifestyle demands</li>
 Moving Cons
<li>The cost of selling and moving can add up quickly</li>
<li>You likely won’t find a house that checks all the boxes</li>
<li>The process of buying can be time consuming</li>
<li>Your options may be limited based on the health of the market </li>
 
<h3>Plan Ahead</h3> 

Another lifestyle tip to help you make this major decision is <a href="https://investinganswers.com/articles/8-steps-creating-smart-financial-plan" target="_blank">to plan for your future</a>. Your financial health plays a lead role in deciding whether to renovate or buy and should be an integral part of your future planning. Create a budget that accurately depicts your current financial health, taking your current expenses, debts, and expendable income into account. Hire an accountant for added help and from there, determine which home investment is most applicable to your current financial situation. If you are low on funds for a big move or renovation, discuss ways to save and design an estimated timeline for next steps. 

When reviewing your financials consider the current housing market as well and what the market was like when you purchased your home. If you purchased your home at an affordable price and incurred a low interest rate on a loan when you purchased, you may have accumulated equity, making it smart to keep on that path! On the flip side, if it’s a sellers’ market, you may be able to get a great price for your current home to help you settle into a house that’s better suited for your life now.
 
<h3>The Decision</h3> 
It’s easy to know when you’re ready for a refresh or need more space, but this doesn’t mean the decision is simple to make. Ultimately, the choice between renovating and moving is yours, but we hope these tips will help you weigh all the factors that are important to include in the process and get you your dream home! 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Learn about your available options for funding your home improvement projects, and answer the question: should you renovate your home or move? 

Home Renovation Funding Options | Unison Home Equity Sharing

The same metropolitan allure that once attracted starry-eyed workers to Manhattan, in spite of the high cost of living, is now the force leading some to abandon it. In the age of COVID-19, the perks of a skyline view and easy commute (not to mention the convenience of coming home after late night happy hours) pales in comparison to the potential danger posed by sharing spaces with dozens of strangers. In addition, most white-collar workers have been working from home (WFH) since March 2020, eliminating the need to commute. This has led many real estate investors to ask, will residents flee New York City altogether?
 

 Our data will demonstrate that, while some residents are leaving the city during the pandemic, many families are still staying within commuting distance, demonstrated by a resurgence of interest in homes in the suburban areas just outside New York City. Our analysis of residential real estate metrics during the pandemic suggests that, instead of leaving New York altogether, families are ditching the city for the suburbs. 


 At Unison, we are most interested in the housing market implications of demographic movements. “Rent downtown for fun, buy in the suburbs for family” had long been the standard American dream formula. With the pandemic rapidly changing housing needs, we sought to understand how markets have been impacted in 2020. 

 A recent New York Times article showed that Manhattan neighborhoods with the most resident departures in the wake of the COVID-19 crisis are generally richer, whiter, and had residents who were more likely to walk or bike to work<a href="#_ftn1" name="_ftnref1">[1]</a>. From this, we can infer that residents who departed had the financial security and work flexibility to choose where to live and whether they want to rent or buy their home. 

 Assuming most departed workers will be tele-commuting as long as the stay-at-home orders are in place, but still live within a commutable distance to their former offices, the exodus can be categorized into three main groups:
 <li>Higher-income employees and managers who owned properties in both the city and the suburbs moved from their city apartments to their suburban homes</li>
<li>Early career workers and students who decided to shelter outside the city with family moved back into family-owned homes in the suburbs.</li> 
<li>The vast majority of people in the middle — who moved from a rented city apartment to a new home (newly rented or purchased) in the suburbs, likely nearby. </li>
The first two groups of movers have little effect on property prices, since the suburban homes they’re moving into were already owned and do not result in new transactions. The third group of movers can boost the suburban housing market through new home rentals or purchases. For those who decide to rent in their new suburban home first, some are likely to eventually buy in the same area. Others who’d planned to buy in the suburbs “eventually” may accelerate their plans and buy now. Additionally, an increase in suburban rental occupancy may drive rents higher, attracting investors and shifting the “rent-or-buy” calculus in favor of buying.

 If suburbs are the next big thing, has the buying wave already begun? 
To find out, we divided counties within and surrounding New York City into urban and suburban markets as follows:
 Urban: Bronx, New York County (Manhattan), Queens, Kings County (Brooklyn)
 Suburban:: Nassau county (a portion of Long Island just west of Queens), Suffolk County (Hamptons), Fairfield County (Greenwich, CT), Westchester County (Scarsdale, Bronxville)
<img src="https://contentimages.o-prod.unison.com/images/blog/nyc/map.png" style="width: 50%">
<h2> </h2> 

 Using seasonally-adjusted data from Redfin, we were able to compare market performance trends between the two groups. The three metrics we believe best reflect the health of housing markets are Months of Supply, Days on Market, and Sale-to-Listing ratio. The data for these metrics are frequently-updated, well-understood, and used widely by real estate agents to assess market temperature.

 Using seasonally-adjusted data from Redfin, we were able to compare market performance trends between the two groups. The three metrics we believe best reflect the health of housing markets are Months of Supply, Days on Market, and Sale-to-Listing ratio. The data for these metrics are frequently-updated, well-understood, and used widely by real estate agents to assess market temperature.

 Months of Supply represents the number of active listings in the market divided by the number of monthly transactions. A higher number indicates an abundance of supply and/or low transaction volume.

Since the introduction of the mansion tax hike in July 2019, Manhattan has seen its Months of Supply climb from 30 months in June 2019 to 88 months in February 2020 (Figure 1). Before COVID-19, transactions for high-end properties waned in the wake of the mansion tax, and mega-developments such as Hudson Yards were already exacerbating the oversupply. COVID-19 has worsened the supply glut to an astounding 271 months as of June 2020. This means that, at the current transaction pace, it would take 22 years to work through the available housing inventory, assuming no new listings are brought to the market. Other New York City boroughs have seen more modest upticks in supply since March 2020. The Bronx held steady at nine Months of Supply, Brooklyn increased from 12 to 20 months, and Queens climbed from seven to 14 months (Figure 2).
<img src="https://contentimages.o-prod.unison.com/images/blog/nyc/figure-1.png" style="width: 50%">
<img src="https://contentimages.o-prod.unison.com/images/blog/nyc/figure-2.png" style="width: 50%">
 In contrast, the pandemic has had virtually no impact on Months of Supply in the suburbs. Supply at all four suburban counties held steady between four to six months. Figure 3 illustrates the percentage change in months supply, highlighting the divide between urban and suburban markets. 
<img src="https://contentimages.o-prod.unison.com/images/blog/nyc/figure-3.png" style="width: 50%">
 Days on Market (DOM) measures the total number of days since the property was first listed. This metric is most useful when evaluated for a specific market over time rather than across markets since typical DOM could vary drastically across markets. For example, it takes roughly two months to sell a house in Westchester, but Brooklyn sellers would be happy if they can sell in three. 
 
<img src="https://contentimages.o-prod.unison.com/images/blog/nyc/figure-4.png" style="width: 50%">
 Echoing what we observed with Months of Supply, Manhattan properties take by far the longest time to sell with a median DOM of 199 days, while Brooklyn is a distant second at 102 days. COVID-19 has likely made selling even more difficult in these two urban markets with little urgency from buyers.
 
 The Sale-to-List ratio is calculated as the sale price divided by the final listing price. This ratio helps buyers and sellers get a sense of how to negotiate on pricing. A high ratio suggests a sellers market, where bids exceed the asking price. Note that the ratio can also increase if sellers aggressively discount listing prices to entice bids.
 
 <img src="https://contentimages.o-prod.unison.com/images/blog/nyc/figure-5.png" style="width: 50%">
 <img src="https://contentimages.o-prod.unison.com/images/blog/nyc/figure-6.png" style="width: 50%">
 As shown by the dashed lines in Figure 5, the Sale-to-List ratio has so far been holding steady between 96-98% in 2020 for suburban markets, suggesting these markets are in equilibrium.

 Manhattan and Brooklyn, on the other hand, actually saw transaction prices inch closer to seller expectations. Sellers in the two boroughs received 4% less than asking price (at 96% Sale-to-List) in December 2019. Since then, sellers in Manhattan are now receiving 1.5% over asking price (101.5% Sale-to-List), while Sale-to-List in Brooklyn rose from 95.6% to 97.2%. Since supply remains elevated in these markets and average time to sell has remained steady, we believe the increase in the Sale-to-List ratio is caused by desperate sellers dropping list prices to get the home to sell rather than a recovery in demand.
 
<h3>Market Condition Based on Key Metrics</h3>
 <img src="https://contentimages.o-prod.unison.com/images/blog/nyc/figure-7.png" style="width: 40%">
Takeaway
 Our findings confirm that suburban housing markets are persevering better than their adjacent urban areas. This is corroborated by the price performance of the eight counties included in the analysis.
 <img src="https://contentimages.o-prod.unison.com/images/blog/nyc/figure-8.png" style="width: 50%">
Moving in with your aunt may make for good comedy, but it is not a viable long-term solution for most adults. As social-distancing and remote work increasingly become the everyday norm, we expect an increasing number of city-dwellers to start making their move to the suburbs permanent. 

 So which suburbs offer the best prospects for investors? While Kensington and Montauk are both considered suburbs of New York City, only one of them is an easy commute to Broadway, museums, fine-dining, consulates, and all the other world-class amenities offered by the Big Apple. We believe that while cities are currently out of favor, the entertainment, amenities and convenience that they offer will eventually be back in demand. Suburbs that are within a 1-hour commute from city centers should continue to see healthy demand and price action in the near-term. The stars are aligned for prized suburbs, as a new class of motivated buyers emerge seeking refuge from the city.

<a href="#_ftnref1" name="_ftn1">[1]</a> "The Richest Neighborhoods Emptied Out Most as Coronavirus ...." 15 May. 2020, https://www.nytimes.com/interactive/2020/05/15/upshot/who-left-new-york-coronavirus.html. Accessed 6 Jul. 2020.</a>

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Unison looks into moving trends during COVID-19, specifically from Manhattan to the NYC suburbs.

Residential Moving Trends During the Pandemic | Unison

Terrance Odean is the Rudd Family Foundation professor of finance at the Haas School of Business at the University of California, Berkeley. Odean had initially been interested in psychology, but was drawn to pursuing a Ph.D. in finance after learning that the dominant theories in finance are based on the assumption that people are hyperrational when it comes to money. That fascinated him because it’s simply not true: People have systematic biases, which makes it possible to predict the type of mistakes they'll make and when they’ll make them. 

Odean’s research into cognitive bias can help others recognize when they’re going to make financial mistakes and if those mistakes are inevitable or if they can be overcome. Here are his suggestions on how best to optimize your financial mindset:

<h3>Automate away bias</h3>
People’s tendencies are to hold on to losing investments and sell winners (known as the “disposition effect” in behavioral finance). From a tax point of view, that's suboptimal, and in many respects it doesn't work out well for people. Professionals, however, will introduce automation to remove choice from the equation. That automation might have a rule to sell a position that’s dropped 10%, which eliminates any deliberation about whether to hold or sell. Automation takes the choice out of what to do with money, and that means not giving yourself the option of making a financial mistake.

<h3>Recognize different types of bias</h3> 
Odean recounts the story of a brother and sister in his neighborhood who inherited their father’s house and wanted to sell it. A real estate agent told them the home was worth $400,000, so when Odean offered to buy the house for $300,000, the brother and sister told him they couldn’t take that much of a loss.

<a href="https://en.wikipedia.org/wiki/Survivorship_bias" target="_blank">Survivorship bias</a> - This is the mistake of ignoring failures, another example that hits homeowners. In rapidly escalating housing markets, the tendency is to regret not buying sooner. While San Francisco homeowners may say, “I wish I’d bought a home 20 or 30 years ago,” that’s not the rule across the entire U.S. 

Homebuyers tend to think that the recent past predicts the future. But real estate, like other investments, goes both ways. It’s important for homebuyers to realize they’re taking a financial risk, even if they are currently in a strong housing market. It’s one thing to be optimistic, but another thing to fall into “that could never happen to me” thinking. The bottom line is that a home is as risky as an equity index.

<h3>Look at the long term</h3>
Even though homes are riskier investments than most realize, they’re also long-term investments. Be aware of the risk going in, but don’t get obsessed with looking at the variations in value. Odean tells his students to buy a well-diversified portfolio of low-cost mutual funds or index funds and don't follow it every day. In fact, he only looks at his portfolio once every year. 

Be aware of the risk, but don’t obsess about small movements in long-term investments.

<h3>Alleviate the risk</h3>

Odean recommends alleviating financial risk whenever possible, and that involves diversification. Instead of investing all of your money in the down payment for a home (which, as previously discussed, is a risky investment), utilizing a co-investment solution allows homeowners to invest some of their money in the home and divert the rest to other investments such as stocks or bonds. 

When it comes to buying a home, Odean advises homebuyers to see what their price range is, not based on what they want but what they can afford. Then, be sure to only look at homes within your price range. Next, get at least four quotes on a mortgage — make sure that you're comparing mortgages with all of the same fees and features — and find the best possible interest rate. 

 Dive deeper into Terrance Odean’s research on cognitive bias and learn more about mitigating the risk of homebuying by viewing the video here:

 <h3>Watch the interview:</h3>

 <iframe width="640" height="360" style="width:100%; height:calc(100vw/1.77777778);" src="https://www.youtube.com/embed/DWc1WMUdZoE" frameborder="0" allow="accelerometer; encrypted-media; gyroscope; picture-in-picture" allowfullscreen></iframe>



 Informational Purposes only: The Content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice. Nothing contained int his blog post constitutes a solicitation, recommendation, endorsement, or offer by Unison or any third party service provider to buy or sell any securities or other financial instruments in this or in in any other jurisdiction in which such solicitation or offer would be unlawful under the securities laws of such jurisdiction.

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Professor of finance shares his suggestions for avoiding common mistakes when buying a home.

Predictable Financial Mistakes of HomeOwners | Unison

If your adult child is late to leave the nest, you’re not alone: 36% of homeowners have an adult child currently living with them. Families are coming together to overcome financial barriers, and providing your child with free housing is a great way to make money go further. 

But you don’t want your child to just get by: You want them to thrive. You want to see them own a home, have a career and experience the hallmarks of a financially secure life. So, to that end, there are several ways to help your adult children flourish in the current economic climate while also protecting your own finances and your own retirement. 

<h2>A dose of reality</h2> 
Life is more expensive now than it’s ever been. There’s a good chance your children are paying their share of our national <a href="https://time.com/5662626/student-loans-repayment/">$1.5 trillion student loan</a> debt while also shouldering a <a href="https://www.lendingtree.com/auto/debt-statistics/">$23,438 car loan</a>. Plus, even if your child has a full-time job, rent can eat up a large portion of it: In Los Angeles, the average person uses <a href="https://www.cnbc.com/2019/03/07/heres-the-share-of-income-that-goes-to-rent-in-cities-across-the-us.html">45%</a> of their salary to pay rent. Your children may very well be working and still find there simply isn’t enough money every month to cover their auto loans, student loans, food bills, cell phone bills, utility bills, healthcare deductibles and all the other expenses of living. 

We’re sure you’ve seen it firsthand. And you’ve probably even pitched in. You may not even realize how often or how much you’re helping out, so to put it in perspective, here's how many American parents are financially assisting their adult child with the following: 

70% tuition 
67% general expenses 
64% transportation 
57% cellphone 
56% groceries 
53% car insurance 
52% medical insurance 
41% student debt 
35% rent/mortgage 
25% streaming plan 

Even if you’re only contributing financially in one or two categories, that adds up over time. And all that money has to come from somewhere. 

<h2>Robbing Peter to PayPal </h2> 

Look back at your PayPal or Venmo transaction history and add up how much money you’ve sent your adult child over the past six months (this may not apply to you, since some parents pay bills directly or use cash, but try it out if you send money via apps). How much was the total? Consider how much that amount would have earned in interest had it been left in a savings account. 

Parents supporting their adult children are drawing from savings, retirement, home equity and even taking on loans to support their kids. Here's how the data breaks down: 

Savings account/CD: 41% 
401(k)/IRA/retirement fund: 8% 
Loans: 8% 
Home equity: 5% 

The first two statistics are the most troubling because they indicate a large portion of adults are taking money from their future. That’s not smart. And lending your adult kid money may be helping in the short term, but it isn’t solving the root of the problem: namely, that your child is just getting by and not thriving. 

<h2>Solving for X</h2> 

Here are two smarter ways to help launch your adult child into financial solvency while protecting your retirement and assets. 

<h4>The debt problem</h4>

If you’ve owned your home for some time, you likely have a substantial amount of equity in it. But while that equity is technically yours, it’s something like owning a sum of money in a bank vault, but you don’t know the code to access it. The old solutions for unlocking equity involved adding more debt to your mortgage, but then you’d need to pay that back in monthly installments with additional interest. That’s not solving anything. 

With a home equity sharing solution, you can access the equity in your home and use that money to help your adult child pay off student loans or as a gift toward a down payment. When you sell your home, the home equity sharing company shares in a percentage of the home’s change in value, up or down. You won’t pay interest or monthly payments. 

This is a great solution for adult children who need a lump sum of cash to get out of debt and start getting ahead. And you won’t have to touch your retirement or savings accounts. 

<h4>The home problem</h4>

It now takes an average of <a href="https://contentimages.o-prod.unison.com/images/downloads/Unison_Affordability-Report_2019.pdf">14 years</a> to save for the 20% down payment recommended to buy a home. If your child is living with you to save money for a down payment, it could mean that the same child who lived with you at 20 may very well still be living with you when they turn 34. 

But it doesn’t need to be that way. 

With a home equity sharing solution aimed at helping home buyers, your child may only need 10% for a down payment — and sometimes as little as 5%. The home equity sharing solution will contribute the remaining 10% or 15%. Just like the previous solution, there’s no monthly payments: The co-investment company shares in the percentage of the home’s increase in value once it sells, or at the end of the agreement term (up to 30 years). 

Consider presenting this solution to your child: It’s a smart way to help them get into a home faster while avoiding drawing from your own retirement or savings. 

<h2>Choosing your solution</h2> 

The right option depends on your child’s situation, so look at the long-term benefits instead of short-term solutions. For instance, if your adult child has a massive amount of student loan debt that increases faster than it can be repaid, using the first option may be the right solution to help your child flourish. 

However, if homes are so expensive that your adult child is putting off moving out, the second option may be best. Either way, home equity sharing is a smarter solution than borrowing against your own retirement. 

We believe that our children should have a better quality of life than we had at their age. But in today’s economic reality, that’s difficult to achieve. The right answer is utilizing smarter solutions and coming together as a family to make sure children have the right resources to thrive and parents have enough money set aside for a fantastic retirement in the future and financial health in the present. 

<img src="https://contentimages.o-prod.unison.com/images/blog/BankofMomandDad_1.JPG" alt="Bank of Mom and Dad Infographic" style="width: 75%">
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Find ways to financially help your children, without sacrificing your own finances or retirement plans.

Financially Help Your Children (Without Sacrificing Your Plans)

If you ask people what is necessary to buy a home, most experts will tell you a cash down payment of at least 20% is a key factor. Lenders will see you as a stronger borrower who brings less risk to the table, and that can increase your chances of getting the mortgage you want with a favorable interest rate.

However, you don’t have to put 20% down to buy a home. In fact, many people are able to buy a home with just 10% down. There’s just one hurdle to overcome: private mortgage insurance (or PMI). In this blog post, we’ll explain the problem with private mortgage insurance and how you can put 10% down while still avoiding PMI.
 
<h3>The Problem with PMI</h3>
Private mortgage insurance is a policy the lender takes out to protect the money they lend you when you take out a mortgage. Lenders typically require PMI when the borrower has less than 20% for a down payment.

If you default on the mortgage loan, the insurance policy will cover the amount of money left on your mortgage. The insurance is designed to protect the lender. It covers them for the money you were supposed to repay but didn’t.

However, you, the homeowner, are actually the one who pays the PMI premiums. Those premiums can add a lot onto your monthly payment. Usually, PMI costs around $30-$70 per month for every $100,000 you borrow, <a href="https://www.zillow.com/mortgage-learning/private-mortgage-insurance/#cost" target="_blank">according to Zillow</a>. Most people want to avoid PMI because it’s an unnecessary cost that doesn’t provide them any value as the homeowner. But how can you put 10% down without paying PMI?
 
<h3>Put 10% Down with No PMI by Using a Piggyback Loan</h3>
A piggyback loan, or a 80/10/10 mortgage, allows you to finance 80% of a home through a mortgage. Then, you put down 10% in cash. The other 10% required to make up a 20% down payment comes from a second loan, worth 10% of the home’s value. That second loan “piggybacks” on the mortgage. It’s completely separate which means it will have its own terms and interest rate. The piggyback loan is still debt and money you need to repay. And it comes with its own monthly payments, which can be quite high. For that reason, home buyers should be cautious about taking on a piggyback loan.
 
<h3>Pay with Points</h3>
Another option is to keep your traditional mortgage and put 10% of your own cash down. Ask your lender if there’s a choice between paying PMI — or adjusting the interest rate on your loan.

Some lenders will allow you to tack half a point of interest onto your mortgage loan in exchange for excusing you from paying private mortgage insurance. The lender may still take out a policy. But with this arrangement, they’ll pay the premiums and you just pay the higher interest rate. However, the higher interest rate can make your mortgage much more expensive. And that cost stays with you for the life of the loan.

Be sure to look at both the short-term and long-term costs before trying any of these options. There are potential drawbacks, including:
<ul>
 <li>Putting 10% down and financing 90% of your purchase means bigger monthly mortgage payments.</li>
 <li>It also means you will have to pay PMI.</li>
 <li>If you ask your lender to pay your PMI it could end up being more expensive because of the higher interest rate.</li>
 <li>Getting a piggyback loan means having more debt that accrues additional interest.</li>
</ul>
 
<h3>Get Support from a Home Ownership Investment</h3>
Instead of dealing with these financial issues, you can turn your 10% down payment into a 20% down payment with the help of a company like <a href="/">Unison<a> who offers home ownership investment programs.

Unison invests alongside you in the home with the <a href="/homebuyer_down_payment_help">Unison HomeBuyer</a> program and you do not make any payments until you sell the home – up to 30 years later. In return, Unison receives a share of any future change in the value of the home whenever you sell it. If the home goes up in value, you and Unison both win. If the home goes down in value, Unison shares in the loss with you.

Unison partners with homebuyers to help them buy a home. They are able to match your down payment funds if you have enough cash for a 10% down payment. With a home ownership investment, your monthly mortgage payment will be lower, and you can avoid PMI — without taking on additional debt. Your monthly payments still go toward building your equity in the home.
 
<h3>Conclusion</h3>
A 20% down payment isn’t a requirement if you want to buy a home. In fact, many people who simply don’t have that much cash available or who want to use their money for other things are buying homes without putting 20% down. This often gives them greater financial flexibility and means that not all their money is tied up in an illiquid asset. With the options discussed above, home buyers can purchase a home they like with 10% down and still avoid paying PMI. Just be sure to run those numbers before you make the deal!
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

Understand your down payment options when buying a home. Find ways to avoid PMI and save on this important purchase.

Buy a Home with Less Money Down | Unison Home Equity Sharing

By Sean Knight

 If you’re in the position of most Americans, your home is likely your largest investment – by a significant margin. Some would call real estate a “passive investment”, but most of us know better! Regular maintenance, the occasional repair, and a wishlist of renovations or <a href="https://www.unison.com/article/best-home-improvements-to-increase-value">improvements</a>, are all part of owning a home. Putting in a little legwork to maintain your home can help protect your investment, reduce the risk of costly repairs, and help you come to a better understanding of where renovations would be most impactful for your home.

 Home maintenance can be overwhelming to say the least, but a good place to start is with a simple home maintenance list. Whether you’re into using your smartphone’s Notes app, a shareable Google Doc, or a good old-fashioned piece of paper for your to-do lists, you can approach your home maintenance in much the same way. This allows you to visualize the most essential tasks, prioritize needs based on the season ahead or a growing family, and keep track of when you last did a certain maintenance task.

 However you plan to track your progress, the most important part is developing your understanding of what aspects of your home need regular maintenance. It’s not exactly like any other! You may also want to look into home maintenance tips (particularly outside maintenance tips) specific to your area – planning for a winter in Minnesota and preparing for the summer in Arizona will demand very different to-do lists!

 For a general starting point, here are some basic home maintenance tips to get you on the right track.

 
<h4>Your Monthly Home Maintenance List</h4>
You’ve probably got a solid routine for daily and weekly household chores, but beyond that, it’s all too easy to throw things in the “I’ll do that next summer” basket. While it’s fine to leave certain tasks for just once or twice a year, don’t neglect these simple, essential home maintenance tasks.

 
<ul><li>Check your HVAC filters, and be sure to clean them when dirty. If they’re too far gone, replacing them is straightforward and inexpensive.</li>
<li>Check around your toilets, sinks, dishwashers, and washing machines for leaks. Be on the lookout for even subtle stains on the wall and soft or rippled flooring.</li>
<li>Test smoke detectors and carbon monoxide detectors. It’s an annoying task, but either of these could save your life in an emergency.</li> 
<li>Take a close look at the caulking around your bathtub and shower, and be sure to fix it if it shows signs of deterioration.</li>
<li>Inspect the filter on your range hood, located above your stove. These pick up all kinds of food particles and grease, and don’t get cleaned nearly as often as they should. Clean the filter, or replace it if needed.</li>
<li>Same goes for your dishwasher filter. These rack up a ton of mileage and have a dirty job – keeping the filter clean will protect your dishwasher, reduce odors, and make your dishes even cleaner!</li> 
<li>For regular outside maintenance, do a thorough inspection of your home’s exterior every few weeks. Look for cracks in the foundation, clogged gutters, or any damage to the paint or siding.</li></ul>

 
<h4>Your Semi-Annual Home Maintenance List</h4>
Now that you’ve got the easy, more frequent tasks down, add these more occasional to-do’s onto the list. Depending on the size of your family, the weather and season ahead, and the condition of your landscaping, you may have to do these tasks more or less often, but 2-3 times per year should be a good cadence to start with.
 <ul><li>Slide out your refrigerator, unplug it, and thoroughly wipe down and vacuum the coils – they may be on the back of your fridge, or underneath it. This helps to keep things running efficiently and save on your power bill!</li>
<li>Remove and unplug your dryer to vacuum out the vent and hoses, which may be on the side or behind your dryer. This prevents nasty buildup and reduces a potential risk of fire.</li> 
<li>Kitchen smelling off-color? It might be time to clean out your garbage disposal. There are plenty of products that claim to be the best, but we’ve never failed with a handful of ice cubes, a scoop of kosher salt, and let it rip!</li>
<li>Examine and test your sump pump, which you might have to keep water out of your basement, crawl space, or foundation. How to test it? Dump enough water into the pit to raise the float and if working properly, the pump should activate and remove the water almost immediately.</li>
<li>For some outside maintenance, take a walk around the house and trim back any trees, bushes, or plants that might be encroaching on your foundation, siding, or roof. Six feet of social distancing is a good rule of thumb here!</li></ul>

 
<h4>Your Yearly Home Maintenance List</h4>
Last, but definitely not least – the big tasks to do once each year. Again, depending on the seasons and climate in your area, it might suit you best to do these a few weeks before winter, a few weeks before summer, whichever puts more “pressure” on your home’s functions. Your house lives and breathes all year long, and after a few years, you’ll fall into a steady routine. Make sure to take care of the home maintenance tips on this list at least once each year:

 
<ul><li>Drain any sediment from your hot water tank. It’s relatively easy to do, and helps your water heater work more efficiently, saving you money year-round.</li> 
<li>Check all of your fire extinguishers by lifting them to make sure they’re full and making sure there are no breakages or blockages.</li>
<li>Inspect your attic, basement, and any crawl spaces for signs of damage. This can look like moisture, mold, termite damage, or rodent activity. Again, it’s important to know what the most common risks in your area may be and any potential warning signs.</li> 
<li>Inspect and repair the caulking around windows and doors, which can easily break down and peel away over time, leaving you exposed to potential drafts and moisture.</li>
<li>Inspect and restock your emergency supply kit, which might include expired food, outdated documents, or dead batteries. Keeping a “go-bag” stocked and ready with essentials is crucial for making it through natural disasters, house fires, and other emergencies.</li>
<li>For your annual outside maintenance, it’s the big (yet immensely satisfying) job of cleaning the outside of your house. That might include spraying down the siding of your home, powerwashing decks and/or driveways, and removing leaves and muck from gutters and drainage pipes. It’s a big job, but nothing feels better than crossing this one off your list.</li></ul>

 
That’s it! While it’s not a conclusive list by any means, this is a great place to start if you’ve been wondering about how to build a home maintenance list and stay on top of it.

 
Once you’ve got your maintenance routine established, you might find yourself building a renovation wishlist as you go. While maintenance is a great way to protect your investment and keep your home running smoothly, clever renovations can modernize your home, enhance the efficiency of your appliances, and boost the value of your property exponentially – not to mention a better quality of life! However, <a href="https://www.unison.com/article/home_improvement_renovation_home_equity"> funding </a> your home renovation wishlist is often easier said than done.

 
With these home maintenance tips, you’ll feel confident enough to keep your family warm, safe, and happy, while protecting your largest investment. If that’s not a win-win, we don’t know what is. Happy householding!

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Get a checklist of home maintenance steps that will protect your home. Find out how to preserve and grow your home equity.

Home Maintenance Tips to Improve Equity | Unison Home Equity Sharing

2020 is “the year everything changed” - and for many, retirement falls into this bucket. With businesses closing their doors and widespread layoffs and furloughs due to the pandemic, some have been forced to retire earlier than they’d planned, leaving them with less savings than they’d hoped. This sudden shift has forced soon-to-be or earlier-than-expected retirees to consider alternative ways to finance their retirement. 

 At the same time, the high level of COVID-19 cases in assisted living facilities has sparked new interest in the concept of aging in place: the ability to live in one’s home comfortably, regardless of age, income or ability level. “You will see a lot more focus on aging at home and figuring out how to shift the financial incentives to make that work,” Ezekiel Emanuel, a member of President-elect Joe Biden’s task force on coronavirus, told the Wall Street Journal recently. 

 In years past, homeowners who had built up equity in their home over the years might sell the house, using the cash to purchase something smaller, perhaps in a 55+ or retirement community. But downsizing houses and relocating isn’t the ideal scenario for many retirees, and traditional methods to tap equity like a home equity loan, HELOC or reverse mortgage mean taking on new debt.

 <h4>Smart Equity</h4>
So, what is the smart solution for homeowners who want to age in place while accessing the equity they’ve built up in their home at the same time? 

 An equity sharing agreement from Unison can provide a great option for these folks, allowing them to convert up to 17.5% of their home equity to cash with no added monthly payments. It’s a solution that allows homeowners to utilize the equity they’ve built up in their home, meaning they can use the cash to supplement their retirement savings and maintain their standard of living for years to come.

 Traditional solutions such as HELOCs and home equity loans involve borrowing money against your equity, which requires monthly payments with interest to repay the money lent to you. Reverse mortgages get rid of the monthly payments, but interest and fees still accrue over time and can eventually claim all the equity in your home.. A Unison home co-investment, in contrast, is not a loan, so there are no monthly payments, no interest, and you get to keep your remaining equity, including equity you continue to build by paying down your mortgage. And when the time comes to move (up to 30 years later), Unison shares in the change in value of your home, up or down.

 The pandemic has changed a lot of people's plans, no question, and uncertain times can lead to anxiety, panic, and in some cases more emotional decision-making. Taking the time to investigate and understand your options can help make retirement a time of relaxation and reflection rather than procrastination and panic. 

 By allowing homeowners to age in place while still enjoying the benefit of the home equity they’ve worked so hard to build, Unison’s solution to smarter equity can help.
 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

retirement

Tips on how to navigate retirement in the pandemic era, how to age in place with the ability to live in one’s home comfortably, regardless of age, income or ability level.

How to Navigate Retirement During the Pandemic

A creative couple with a charming home in Moss Beach regained their feeling of financial freedom by partnering with Unison to unlock the equity in their home—with no additional monthly payments.

<h2>A Happy Couple Living Near the Ocean</h2>
Leslie and John are both self-employed. They met 27 years ago while working at a publishing company, and today they live and work happily in the home they bought together in Moss Beach, a beautiful coastal town 30 miles south of San Francisco. They like the easygoing lifestyle in Moss Beach and they love their home.

Both Leslie and John do freelance work — Leslie runs webinars and trainings for a wide range of companies while John specializes in copyediting for a variety of clients. They work remotely, which means they have plenty of time to enjoy their home.

But at the same time, they dreamed of doing a few important home remodels and they were searching for a higher level of financial security.

<h2>Ready to Pay Off Debt and Make Home Remodels</h2>
As freelancers, both Leslie and John have a variable monthly income. This often makes it difficult to plan for large expenses.

Leslie also had some outstanding debt she was eager to pay off. Leslie’s mother had been facing serious medical challenges that resulted in unexpected travel costs for Leslie, traveling to Southern California to visit her ill mother, which meant more credit card bills. John had some tax bills he was eager to pay off.

Leslie and John really wanted to unshackle themselves from these debts, and Unison was a great solution for their situation.

She and John also wanted to do some long-awaited remodels on their home that would allow them to enjoy it even more.

<h2>Unlocking Home Equity with Unison</h2>
When they reached out to Unison, they were uncertain about what the company could offer, but they wanted to learn more. “I thought at first it was too good to be true,” Leslie said. “I was looking for the catch. But the more we looked into it and read the reviews, it just sounded really good. Unlike a home equity loan, we wouldn’t have to make a big payment every month to pay it back. And that seemed really enticing.”

Once they made the decision to partner with Unison via the <a href="/homeowner">Unison HomeOwner</a> program, everything moved quickly. “We decided to go for it,” said Leslie. “We went through the process and it was pretty smooth.” They were pleased at how fast it got done.

With their Unison funds in hand, they were ready to take action. “The first thing I did was pay off all my credit cards, and that just felt really good,” Leslie said. “I immediately paid off Uncle Sam. That made it all worthwhile,” said John.

Not only do they no longer have to worry about debt, but they have a substantial amount set aside for a rainy day. “Now we have an emergency fund to back us up during any down times,” Leslie told us.

Gaining back that feeling of financial freedom was priceless to them. Leslie said, “It has made a really big difference in terms of my stress levels.”

Even better, they can now start planning those home improvements they’d been putting off.

They plan to put in recessed lighting in the living room, which will make it more enjoyable to spend time in. Then Leslie plans to completely remodel one of the bathrooms by laying down beautiful new tile and expanding the shower while also making it more modern. John hopes to continue upgrading the garden with drought-resistant native plants replacing the formerly scraggly, thirsty lawn.

We are so glad these two were able to accomplish their goals with Unison and we’re honored they chose us as a partner.

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

With a home equity sharing agreement from Unison, Leslie and John were able to tackle debt, make home renovations, and pay bills. 

Couple Reliefs Debt with Equity | Unison Home Equity Sharing | Blog

By Lauren Rosales, Content Writer

 If your current home is far from your Dream Home, you’re in good company. Maybe you wish to expand your family and need more space in which to do it. Perhaps some of the things that were a compromise when you bought this house are no longer negotiable—you really do need that big bedroom closet, for example, or the narrow galley kitchen just won’t cut it anymore.


 But nobody really enjoys moving. The truth is that moving ranks as one of the most stressful life events, period. In a <a href="https://swns-research.medium.com/moving-tops-the-list-of-most-stressful-life-events-c673b81733e2"> 2020 survey</a>, most participants rated moving as being more stressful than getting a divorce or having children! So why would anyone voluntarily do it? Couldn’t one just renovate? Let’s explore both options.

 HGTV has added “renovation” to just about everybody’s vocabulary. Thanks to a host of popular shows, it seems as though just about everyone has a plan about what they’d change about their house. 76% of Americans <a href="http://zillow.mediaroom.com/2018-10-11-Americans-Would-Rather-Renovate-than-Buy-a-New-Home"> would rather renovate </a> their current homes than make a down payment on a new one—given a set amount of money, that is. Renovations are pricey. And the fairytale renos we see on HGTV are <a href="https://theglasshouse813659743.wordpress.com/category/blogs/e"> far from representative of reality </a>. Unfortunately, the fairytales also <a href="https://www.jstor.org/stable/23273533"> encourage audiences to DIY </a> when maybe there are some things that just shouldn’t be DIY-ed. If you take out a load-bearing wall, for example, that could be an expensive mistake to make!
 

 So, we know that moving is stressful and renovations are complex and expensive. Moving <a href= "https://www.forbes.com/advisor/home-improvement/movers-and-packers-cost/"> isn’t exactly cheap </a> , either, and that’s without considering the cost of the new house, realtor commission, or unavoidable repairs. But who wants to live in a perpetual construction zone? Obviously, there are pros and cons to both options. But to start thinking through them, here are some questions you should ask yourself: 

 
<ul><li><h4>Do you love the literal “where” of where you live?
</li></h4> Are you fond of your neighbors? Do you cherish being on the bus route, or a short walk away from the bakery where you can get cinnamon rolls and coffee on Saturday mornings? Do your kids have friends down the street? Don’t forget to consider boundary lines for specific schools, and your commute to work!
 
If your answer is a resounding “YES,” you should look closely at the possibility of renovation. What is the likelihood that you would find a house in your same neighborhood that has all the amenities or upgrades that your current home lacks? But if you dislike your neighborhood, can’t stand the commute to work, and aren’t comfortable with the school your children are zoned into, granite countertops and walk-in closets are not going to help.

 

<li><h4>What are the top reasons you’re considering this change?
</li></h4> Is the lack of storage in your kitchen beginning to disrupt your daily life? Are your kids getting too old to share a bedroom? Do you want to gouge out your eyes each time you encounter the 1970s pea green tile in the master bathroom? Perhaps you’ve gotten fed up with several issues that used to seem small, but over time have come to eclipse everything else you see when you look at your home.

 
When you consider, you may find that some problems just can’t be solved by renovations—for example, if you have a rapidly growing family and you need multiple extra bedrooms and bathrooms to accommodate them. On the other hand, if your frustration with your house is limited to one room, an unfinished area like a big basement, or multiple smaller-scale issues (especially aesthetic ones, like that pea-green bathroom tile), you might see renovation as the most logical course.

 
<li><h4>Would either option be overwhelmingly more expensive than the other?</li>
</h4> Neither moving nor renovating will be cheap. The <a href= "https://www.homeadvisor.com/cost/additions-and-remodels/remodel-multiple-rooms/"> typical range for renovations </a> is $17,960-$76,951, depending largely on the scope of the project, the quality of materials, and potential complications. But moving, too, has quite a few costs. If you move into a larger home, it will not only cost more on the sticker, but will increase your monthly utilities, your taxes, and you’ll have to buy the furniture and appliances to fill it. Plus, you can expect to spend <a href= "https://www.zillow.com/sellers-guide/costs-to-sell-a-house/"> around $5,000 </a> on simply readying your current home for the market!</li></ul>

 The good news is that Unison can help you consider this third question! Once upon a time, unless you had a tremendous amount of money in savings, <a href= "https://www.zillow.com/sellers-guide/should-you-remodel-or-move/"> the most common ways</a> to pay for considerable renovations were a Home Equity Line of Credit (HELOC), cash-out refinancing, or a home equity loan. Each of these options would charge interest, affecting your long-term finances, and saddling you with debt. Unison offers an alternative—we convert up to 17.5% of your home’s value to cash and give it to you to bring those fairytale projects just <a href= "https://www.unison.com/how-it-works/"> that much closer </a> to your reality. You don’t have to worry about monthly payments or interest. When you do eventually decide to sell your home, only then would you pay Unison an amount equal to the original payment plus or minus a share of your home's change in value.

 Unison is a great fit for those who want to invest in their home for the long-term. After three years, homeowners become eligible to apply for a <a href= "https://www.unison.com/blog/process-agreement-duration/"> Remodeling Adjustment </a>, which would allow you to keep the increase in home value that results from your renovation improvements. And, with our help, you won't make the expensive mistake of cutting corners to trim the cost of your project! Not all renovations equally boost your home’s value, so we can also help you decide <a href= "https://www.unison.com/blog/best-home-improvements-to-increase-value/"> which types of renovations</a> would be the most fruitful for you. 

 We have helped <a href= "https://www.unison.com/success-stories/"> over 8,000 homeowners</a> drastically improve their quality of life, and presenting them with the capital needed to renovate their homes is only one slice of that pie. Some of our homeowners have used the cash to dig themselves out of student loan debt or pay off a mortgage before the accumulating interest overpowered them. Others have financed small business ventures or increased the comfort and security of their <a href= "https://www.unison.com/blog/retirement-2020_equity_reverse/"> retirement</a>. You may find that you can accomplish more than merely one objective with the cash that we offer! If you’re curious to see just how much money you might have left after your renovation, <a href= "https://www.unison.com/home-renovation/">check out our calculator</a> , which will offer you an estimate based on your home’s value, our projected offer, and the average cost of common remodeling projects.

 If you feel like you might be part of the 76% of folks who would rather renovate than move if only they had the money, <a href= "https://www.unison.com/blog/process-applying/"> reach out </a> to Unison today to see how we might be able to make that “if” a “when.”

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

Questions to answer if you're thinking of moving or renovating your home

Renovate Home or Move | Unison Equity Sharing | Blog

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How to Make Sense of Down Payments when purchasing a home

How to Make Sense of Down Payments

A piggyback mortgage loan is a home equity loan or home equity line of credit (<a href="https://www.unison.com/article/how-does-a-HELOC-work">HELOC</a>) issued to a home buyer simultaneously with a conventional mortgage. It allows borrowers to <a href="https://www.unison.com/article/how-to-put-10-percent-down-with-no-PMI">make less than a 20% down payment</a> without having to pay for private mortgage insurance (PMI).

<h3>How does a piggyback loan work?</h3>
Let’s say a home buyer only has 10% of the purchase price in savings for the home they want. They have the option of applying for a first mortgage to cover 90% of the home’s value, but that would require them to pay for <a href="https://www.unison.com/article/how-much-does-pmi-cost">expensive private mortgage insurance</a>. 

Instead, the home buyer could choose to take out a second loan to cover the other 10% of the down payment and avoid paying for PMI. This type of piggyback loan, known as an 80/10/10 loan, is most common. But some borrowers may qualify for an 80/15/5 loan, which only requires the home buyer to pay a 5% down payment. 
<h3>Is it better to pay PMI or get a second mortgage?</h3>
That depends on certain factors, including your credit score. Often, a piggyback second mortgage comes with a higher interest rate, but the borrower may still spend less than they would on private mortgage insurance.

In other cases, the interest rate and total closing costs will drive up the cost of a piggyback loan even higher than the cost of private mortgage insurance on a primary mortgage. Calculate your total monthly mortgage payments for both scenarios before you decide which option is best for you.
Also, keep in mind that piggyback loans can make it difficult to refinance down the road. 
<h3>How do you qualify for a piggyback loan?</h3>
You’ll need good credit to qualify for a piggyback loan. You’ll most likely need a credit score above 680 to be eligible, but the minimum can vary by lender. You can also consider other alternatives. 
<h3>Alternatives to piggyback loans</h3>
There are a few other alternatives that also allow you to <a href="https://www.unison.com/article/how-to-get-mortgage-loan-with-no-PMI">get a mortgage loan with no PMI.</a>
<ul>
<li>Take out an FHA loan. You can get a mortgage with as little as 3.5% down, but you’ll pay mortgage insurance premium fees that may be more costly than PMI. </li>
<li>Explore down payment assistance programs. If you meet the income requirements and you’re a first-time home buyer, you may be eligible for a grant that doesn’t need to be repaid. </li>
<li>Check out home co-investments. Programs like <a href="https://www.unison.com/homebuyer_down_payment_help">Unison HomeBuyer</a> allow you to double your 10% down payment so you can get a conventional mortgage without paying PMI. It’s not a loan, but rather an investment in the value of your home; Unison receives a share in the appreciation (and, in most cases, the depreciation) of your home when you sell it - up to 30 years later. </li>
 </ul>

Be sure to carefully consider all your options and the associated costs before making a decision about your financing strategy.
 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Learn why not all home buyers need a piggyback mortgage loan. A piggyback mortgage loan is a HELOC issued with a conventional mortgage. 

Piggyback Loans Explained | Unison Home Equity Sharing | Blog

A home equity line of credit, or HELOC, is a financial product that allows you to tap into your home equity. You can use the money to fund home repairs, pay for large expenses, or whatever else you like. However, you need to make monthly payments to the lender in order to repay the loan over time.

For homeowners who have a solid credit history and plenty of home equity, a HELOC may be an affordable and convenient way to access a line of credit. But it’s not the right solution for everyone. Below, we explain how a HELOC works and how to know if it’s right for you.

<img src="https://contentimages.o-prod.unison.com/images/blog/How-Does-a-HELOC-Work-862x575.jpg">

<h3>What is a HELOC?</h3>
This type of loan is a revolving line of credit which uses your home as collateral. You get approved for a maximum loan amount and can draw on the line of credit as often as needed for a period of time. That time is known as the “draw period” and usually lasts around 10 years. After the draw period you enter the “repayment period” when you must pay off the amount you have borrowed.

The amount of credit you can qualify for will depend on several factors, including how much equity you have in your home, your credit score, your income, your debt-to-income ratio, etc. Most lenders require that your home equity is equal to greater than 20% of the home’s value.

While you may get a lower interest rate on a HELOC compared to an unsecured account like a credit card, it doesn’t mean the interest can’t add up quickly. HELOCs typically have variable rates, meaning that your interest rate can go up or down over time.

<h3>What is the Process to Get a HELOC?</h3>
Applying for a HELOC is a fairly straightforward process. First, you’ll need to fill out an application form with a lender. The application will usually ask for your personal information, property information, employment or income information, and the types of debt or financial obligations you have. All of this is used to help determine your eligibility for a loan.

You’ll also be required to get a home appraisal to determine the current value of your property. The lender needs to know the current value so they can decide how much to lend you.

Depending on your situation – such as whether you’re self-employed or live in a certain area – you may be asked to provide additional documentation. This could include proof of insurance, two years of tax returns, and documentation of bankruptcies or child support payments.

If your application is approved, the lender will then schedule a time to close the loan and complete any necessary documents. This is the time to review all contracts and understand what your obligations are before signing on the dotted line.

<h3>How Can I Access Funds?</h3>
After signing the loan, you have three business days to change your mind. This period is called the “right of rescission.” After these three days pass, you can access your HELOC funds.

Your lender can arrange to have funds from the HELOC deposited into your bank account once the right of rescission period has passed.

Also, depending on your lender, there may be multiple ways to access funds. You may be able to get money by writing a check, calling the lender, or accessing your account online. Note that some lenders may have minimum or maximum withdrawal requirements.

<h3>What Am I Responsible For as a Borrower?</h3>
Before taking out a HELOC, read the fine print and make sure you understand what it is that you’re getting into. Since this is a variable loan, minimum payments can change from month to month. Borrowers may also need to pay other fees on top of upfront closing costs. These can include an annual membership or a transaction fee, which is charged each time you borrow money.

You should also know that minimum payments during the draw period may be lower than the repayment period. That’s because you may be paying interest only during the draw period while your payments during the repayment period may include the full amount.

Some lenders may also ask you to make an additional payment of the principal loan amount at the end of the loan, also known as a balloon payment. It’s important to understand what your responsibilities are and what the terms of the agreement are, because otherwise you could be at risk of losing your home.

<h3>Understand What You’re Getting Into</h3>
Whether it’s for home improvements or to pay for your child’s college education, taking a HELOC can be a convenient way to tap into existing home equity. However, this is a big responsibility that requires a strict commitment to repayment.

Before deciding to use a HELOC, consider your entire financial situation as well as alternatives like the Unison HomeOwner program which has no monthly payments and no interest charges.
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Learn more about how a HELOC works & if it's the right fit for you

How Does a HELOC Work? | Unison Home Equity Sharing | Blog

Get preapproved. Find a dream home. Complete loan application. Loan file created. Proceed to underwrite. Decision made.

When the mortgage approval process is broken down like that, it seems relatively simple. But, unless you're starring in a 30-minute episode of "House Hunters," it's a bit more involved. In fact, from preapproval to final approval, a lot is going on behind the scenes.

Out of all the steps listed above, the mortgage underwriting process is the make-or-break phase. In a nutshell, the underwriting process is an analysis used by lenders to vet customers. 

Underwriting looks at the potential home buyer and the piece of real estate they're interested in purchasing to find out the degree of risk posed to the lending company.

Let's walk through the steps of the underwriting process. 

Steps of the underwriting process:
<ol>
<li>Risk analysis</li>
<li>Loan requirement verification</li>
<li>Loan document assessment</li>
<li>Decision time</li>
 </ol>

<h2>Step 1: Risk analysis</h2>
This usually raises one of the most common questions asked about the mortgage underwriting process: What is an underwriter?

Underwriters are risk-takers. Of course, you probably won't find them shark diving off the Farallon Islands or base jumping from Salesforce Tower. But, when it comes to the mortgage underwriting process, mortgage underwriters are the Evel Knievel of the lending industry. 

Underwriters are financial experts employed by lending companies. An underwriter is ultimately the one who decides if you qualify for a mortgage based on their review and assessment of financial information. It's the job of the underwriter to determine if offering a loan to an applicant is risky business. Then, they decide how much risk they're willing to take based on an individual's financial profile. 

To evaluate how much (or how little) risk an applicant presents, underwriters look at the three Cs: credit, capacity and collateral.
<h3>Credit</h3>
When an underwriter looks at a credit report, they're looking at the current credit score and the overall credit history. Although not the sole determining factor, credit carries a lot of weight in the loan application decision. Some of the potential red flags underwriters look for:
<ul>
<li>Late payments on credit cards</li>
<li>Mortgage payment delinquencies</li>
<li>Foreclosures or property liens</li>
<li>Bankruptcies</li>
<li>Current collections or recent charge-offs</li>
<li>Number of new credit requests in the past year</li>
 </ul>

Depending on the type of loan (and whether a loan is processed automatically or manual underwriting is used), additional information may be considered.

<h3>Capacity</h3>
Part of a mortgage underwriter's risk assessment involves scrutinizing a loan applicant's financial situation. The underwriter evaluates your ability to make the anticipated monthly mortgage payments. The documents requested by your loan officer are used for this.

They'll begin the risk analysis by checking income and employment, assets and liabilities.

Income is confirmed using pay stubs and tax returns. Then, your income is compared to your monthly debt and other financial responsibilities. This is referred to as your <a href="https://www.unison.com/article/what-is-good-debt-to-income-ratio">debt-to-income ratio (DTI)</a>.

<h3>Collateral</h3>
Risk evaluation also involves making sure the property is worth the loan amount requested. This is referred to as LTV (loan-to-value). Like the <a href="https://www.unison.com/article/home-equity-loan-heloc-application-approval-process">HELOC application approval process</a>, the appraisal ordered by your loan officer provides an estimated property value. This is based on current real estate benchmarks in the local area.

This ensures the property you plan to purchase is acceptable collateral toward the mortgage loan, in the case of default.

<h2>Step 2: Loan requirement verification</h2>
It's at this time that the underwriter may request additional documentation.

Most types of loans have similar standard requirements. But there are certain types of loans (FHA, Fannie Mae, Freddie Mac and <a href="https://www.unison.com/article/how-long-to-get-cash-out-refinance">cash-out refinance</a>, for instance) that require additional documentation.

It is the job of the underwriter to make sure the person applying for the loan (and the property they're interested in purchasing) meet all loan requirements.

<h3>How long does the underwriting process take?</h3>
The amount of time it takes for the underwriting process varies. It can take as little as a couple of days or may extend to several weeks. One issue that can lengthen the time frame is loan file incompleteness. To avoid delays, be thorough when providing documentation upfront. And be quick to respond to additional requests for information.

<h2>Step 3: Loan document assessment</h2>
There's a long list of documents a home buyer must provide during the mortgage process. The underwriter determines if all required documentation has been supplied in the loan file. They'll also verify accuracy. They examine the documents that were required during the application process:
<ul>
<li>Bank statements</li>
<li>Pay stubs</li>
<li>Tax returns</li>
<li>Credit history</li>
<li>Current credit report</li>
<li>Assets and debts</li>
</ul>

<h3>What do underwriters look for on bank statements and additional documentation provided?</h3>
Bank statements show the underwriter what you have readily available as far as assets, or cash reserves. They want to establish that you can pay closing costs and other fees associated with the home loan. They also want to confirm your income is enough to cover your current debts, plus your new mortgage payment. 

<h2>Step 4: Decision time</h2>
Once all documentation has been examined and verified, the underwriter will contact your loan officer with the decision. There are three possibilities: approval, denial, or conditional approval.

Approval is self-explanatory. Congratulations!

Denials occur for several reasons. Perhaps your DTI is outside the suggested guidelines or you don't have enough cash reserves to pay the required <a href="https://www.unison.com/article/down-payment-guide-for-first-time-home-buyers">down payment</a>.

Conditional approval status means the application is suspended. Typically, the loan is approved as long as certain conditions are met. The underwriter may need additional documentation, letters of explanation, or clarification on some other issue. For the most part, conditional approval is good news. It simply means the loan process will take a little longer.

So, before the final scene is filmed (picture smiling realtor handing keys to giddy home-buyers-turned-owners), take some time to learn how the underwriting process works. It may very well prevent your home-buying episode from ending up on the proverbial cutting room floor.
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Learn about the mortgage underwriting process and the data that analysis use to vet home buyers.

Mortgage Underwriting Process | Unison Home Equity Sharing

By Jia Taylor, Content Marketing Lead

 Unison is redefining how homeowners access their home equity, by helping them unlock their equity without taking on additional debt. On this episode of <a href="https://weaver.com/podcast/podcast-episode-1050-unlock-your-home-equity-without-taking-additional-debt">Weaver: Beyond the Numbers Real Estate Podcast</a> Theo Haugen, Director of the Home Partnership Team at Unison, sits down with hosts Rob Nowak, Partner, Tax Services at Weaver and Howard Altshuler, Partner-in-Charge, Real Estate Services at Weaver to discuss Unison’s unique homeowner partnership. 

 “If we can do things to help the homeowner achieve their financial goals, avoid more [housing-related debt], make better renovation decisions, and eventually sell their home for more money, they’re going to make more money, we’re going to make more money and our investors are too.” Haugen says. “We succeed when the homeowner succeeds as well.” 

 Haugen says unlike traditional financial services that offer loans, Unison is not a lender but, rather, invests along with homeowners, providing upfront financing. In return, it shares in the future gain or loss when the homeowner decides to sell*. 

 In this true partnership, Unison provides homeowners with access to funds and the freedom to use the cash payment however they choose – like consolidating debt, paying off a credit card or unexpected expenses, like medical emergencies – in order to meet their financial goals.

 Dive deeper into Theo Haugen’s interview and learn more about how Unison provides homeowners with debt-free access to their home equity by viewing the video below, or by listening on <a href="https://open.spotify.com/episode/1VUdYI18WsmZP5Wtqb4jC1?si=YrCVMmTFRR6XhakCxa6tDg">Spotify</a> and <a href="https://podcasts.apple.com/us/podcast/ep-1050-unlock-your-home-equity-without-taking-on-additional/id1454557574?i=1000542749036">Apple Podcasts.</a>

 <iframe width="640" height="360" style="width:100%; height:calc(100vw/1.77777778);" src="https://contentimages.o-prod.unison.com/videos/Episode-1050-Unlocking-home-equity-without-adding-debt.mp4" frameborder="0" allow="accelerometer; encrypted-media; gyroscope; picture-in-picture" allowfullscreen></iframe>

* Unison will not share in any decrease in value if the homeowner sells the home within five years of our investment. In addition, if the homeowner does not properly maintain the condition of the home and it results in a significant decrease in the home’s market value, Unison reserves the right to offset the decrease in value with a commensurate upward adjustment. 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

Unison's Director of Home Partnerships, on the Weaver podcast.

Podcast, Director of Home Partnership Team | Unison® | Blog

By Jia Taylor, Content Marketing Lead

 <h4>Takeaways:</h4>
<ul><li>Climate change is impacting homeowners across different U.S. markets.</li>
<li>Unison is factoring climate change scenarios into its investments.</li>
<li>Climate-change risks are leading homeowners to take new measures to keep their assets protected.</li></ul>

 Climate change is projected to shape the course of history over the next century, and homeowners across the country are already beginning to feel the effects. 


 From rising sea levels to wildfires to hurricanes and floods, societies have undergone fundamental changes in how people live, changing the way many homeowners think about their largest financial asset.

 In parts of the West, the growing danger of wildfires is already making it harder for homeowners to get insurance, while future sea level rise poses serious threats to the viability of coastal communities. 

 To understand how climate-related risks are having an impact on housing values and the cost of homeownership, researchers at Unison analyze data to identify potential risks and further improve its active management. How will climate change impact housing value and how can homeowners protect their assets in the face of climate change?

 <h4>Rising Sea Levels</h4> 
<a href="https://oceanservice.noaa.gov/hazards/sealevelrise/sealevelrise-tech-report.html">The National Oceanic and Atmospheric Administration (NOAA) reports</a> that sea levels on the U.S. coastline will rise, on average, 10 to 12 inches over the next three decades — in the same time it will take to pay off today’s 30-year mortgage. The projected increase is especially alarming given that it took over a century of climate change for sea levels to rise that much to the present day. 

 According to a <a href="https://www.sciencedaily.com/releases/2020/01/200122150021.htm">study by the University of Southern California</a>, 13 million people in the U.S. alone, could be forced to relocate due to rising sea levels by 2100.

 Unison is already factoring climate change scenarios into its investments. Unison has built proprietary technology to track and monitor sea level rise. In <a href="https://contentimages.o-prod.unison.com/images/im/2021/ESG_Report_2021_final.pdf?utm_content=esg-page-hero">Unison’s 2021 Responsible Investing Report,</a> Unison has overlaid its geographically diverse portfolio with the projectons of sea level rise issued by the NOAA. 

 The analysis shows that in a scenario where sea levels rise by 0.34 meters, none of Unison’s assets currently under management would be impacted by this specific climate risk. Under a more extreme scenario of a 0.91 meter sea level rise, approximately 0.35% of Unison’s investments would be affected.

 <img style="max-width:100%;height:auto;" src="https://contentimages.o-prod.unison.com/images/blog/blog-portfolio-exposure.png">

 <h4>Rising Temperatures</h4> 
Rising global temperatures are triggering climate-related events including dangerous levels of wind, rain and flooding. <a href="https://www.climate.gov/disasters2020">NOAA’s National Centers for Environmental Information (NCEI) reports</a> that 2020 was a historic year of extremes — with 22 separate events causing approximately $95 billion in damages. 2021 followed the same trend; <a href="https://www.americanprogress.org/article/extreme-weather-cost-u-s-taxpayers-99-billion-last-year-getting-worse/">data collected by NOAA</a> shows that last June was the hottest on record across the United States, while this past July was the hottest July worldwide. 

 An increase in temperature can also have a direct impact on the expense of owning a home, such as higher utility costs. Higher temperatures mean more people using electricity for air-conditioning to stay cool or an increase in water usage to maintain lawns. The more demand for these resources, the more expensive they become.

 Unison data shows that transitioning to renewable energy sources such as solar energy, improves homeowners’ carbon footprints and property marketability. Solar shading also helps keep buildings cool by reducing heat gain. According to the <a href="https://contentimages.o-prod.unison.com/images/im/2021/ESG_Report_2021_final.pdf?utm_content=esg-page-hero">U.S. Energy Information Administration: Monthly Energy Review,</a><a href="#_ftn1" name="_ftnref1">[1]</a> residential buildings consumed approximately 22% of the energy produced in the United States in 2020 and were responsible for 20% of total U.S. emissions, or 902 million metric tons of carbon monoxide.

 <img style="max-width:100%;height:auto;" src="https://contentimages.o-prod.unison.com/images/blog/blog-unison-im.png">

 <h4>Wildfires</h4> 
The <a href="https://www.realtor.com/news/trends/why-californias-devastating-wildfires-will-push-home-prices-even-higher/">2020 California wildfires</a> destroyed millions of acres and thousands of structures, causing unprecedented devastation to people’s homes - making it the worst wildfire season on record. The disasters also sent real estate prices climbing in the nearby areas unaffected by fires, as those rendered without homes were competing with city buyers, driving prices up even further. 

 If you live in an area that’s prone to wildfires, some actions can help ensure the safety of your home. One way to be prepared is to read through your current insurance policy or any new policies you are considering and get supplemental <a href="https://www.unison.com/blog/fire_insurance_questions_california/#ftn1">fire insurance</a> if necessary.

 <h4>Floods</h4> 
Homes in coastal areas that are prone to flooding are somewhat ironically desirable to many buyers for their gorgeous views of the water; their prices are correspondingly high. A <a href="https://www.redfin.com/news/flood-risk-home-price-premium-q1-2021/">2021 Redfin study</a> found that homes with a high flood risk sold for 13.6% more than homes with low flood risk during the first quarter of 2021, nearly double the premium of 7.2% in the first quarter of 2019. The reason? Experts say homebuyers may not be aware that they’re purchasing a home in a flood plain or just don’t view it as an immediate danger.

 <a href="https://assets.firststreet.org/uploads/2020/06/first_street_foundation__first_national_flood_risk_assessment.pdf">Research by First Street Foundation</a> reports that 23.5 million properties are at risk of flooding over the next 30 years. Homebuyers can check First Street Foundation’s <a href="https://riskfactor.com/about">Flood Factor Tool</a>, for flood risk data in their neighborhoods. 

 <h4>Hurricanes</h4> 
<a href="https://www.npr.org/2021/11/30/1060158141/2021-atlantic-hurricane-season-ends-third-most-active-year-ever">National Public Radio (NPR) reports</a> that the 2021 Atlantic hurricane season was the third most active year in history. Recent studies indicate that there has been an <a href="https://www.epa.gov/climate-indicators/climate-change-indicators-tropical-cyclone-activity">increased number of Atlantic hurricanes </a> over the past 20 years.

 It also means a higher risk of damage to property in the path of these storms. While typical home insurance policies cover sudden water damage caused by pipes or water heaters, floods caused by natural calamities such as hurricanes require a separate policy. To apply, your community must be registered in the <a href="https://www.floodsmart.gov/">National Flood Insurance Program (NFIP).</a> 

 <h4>What Housing Markets Are Most At-Risk to Climate Change?
</h4> 
According to data from Insurify, coastal cities, perhaps unsurprisingly, are most at risk to climate change. As of 2020, <a href="https://insurify.com/insights/housing-markets-most-at-risk-for-climate-change/">the top five housing markets most at-risk for climate change </a> 
 include:

 <h4>1. Santa Ana, CA </h4>
 <h4>2. Hialeah, FL <h4>
 <h4>3. Paterson, NJ <h4>
 <h4>4. Inglewood, CA <h4>
 <h4>5. Allentown, PA <h4></h4>

 <img style="max-width:100%;height:auto;" src="https://contentimages.o-prod.unison.com/images/blog/blog-insurify.png">

 <h4>Future Impacts of Climate Change
</h4> 
Climate change risks and more frequent extreme events like flooding and wildfires could impact your home value in the future in several ways including: 
<ul><li>Increased Home Damage - rebuilding a home after a calamity can result in large-scale financial loss, making it difficult for a homeowner to fully recover financially.</li>
<li>Decreased Home Values - frequent tidal flooding caused by rising sea levels has been found to diminish the value of homes in at-risk areas.</li>
<li>Higher Insurance Premiums - insurers are mitigating the risk of climate change by raising home insurance premiums, especially in areas prone to wildfires or floods.</li>
<li>Higher Property Taxes - a study by the <a href="https://realestate.usnews.com/real-estate/articles/how-climate-change-could-impact-your-home-value">U.S. News and World Report</a> finds that due to many people leaving some coastal communities because of tidal flooding the tax base is shrinking, causing a property tax increase to pay for infrastructures.</li>
</ul> 

 <h4>The Bottom Line
</h4> 
The unpredictability of climate change makes it difficult to evaluate the risk, but taking action early can make a difference. If you’re buying a home, try to think ahead. Consider the potential risks of climate-change hazards when deciding where to live. 
<ul><li>Check the address on sites such as <a href="https://climatecheck.com/">Climate Check</a>, <a href="https://riskfactor.com/?utm_source=floodfactor">Flood Factor</a> or <a href="https://www.attomdata.com/solutions/home-disclosure-report/">Attom Data Solutions Home Disclosure Report</a> for information on storms, floods, and wildfires. </li>
<li>Ask the seller and listing agent for information about previous flood or fire damage.</li>
<li>Ask a home inspector to keep an eye out for evidence of previous storm or fire damage. </li>
<li>Be aware of the full cost of ownership, including maintenance and insurance and how those costs could rise. </li>
<li>Request a homeowners insurance estimate as early as you can in order to determine its affordability.</li>
<li>When renovating your home, consider potential climate change impacts likely to affect your area.</li>
<li>Consider adding storm-resistant features like hurricane shelters, stronger windows, mesh coverings for vents (in fire-prone areas) or solar panels as a source of renewable energy.</li></ul> 

 Unison’s Home Partnership Team works alongside Unison’s homeowners to help them navigate their homeownership journey, and can provide additional resources. 

 <a href="#_ftnref1" name="_ftn1">[1]</a> U.S. Energy Information Administration: Monthly Energy Review January through December 2021</a>
<a href="#_ftnref2" name="_ftn2">[2]</a> Unison Investment Management: Internal Calculations 2021
</a>
<a href="#_ftnref3" name="_ftn3">[3]</a> Stanford University DeepSolar Database, originally published by Joule December 2018</a>

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

Solar panel 2

Rising temperatures, extreme weather, and rising sea levels can impact your home’s prices. Here are simple tips to help protect you and your family financially. 

Climate Change Impact on Home Value | Unison Equity Sharing

By Jia Taylor, Content Marketing Lead

 The success of your homeownership journey largely depends on the company you keep. Having the right people by your side can help make your homeownership experience less stressful and more enjoyable.

 Whether it’s to secure new financing, organize your home remodeling projects, analyze comparable home sales in your area, or understand your contractual obligations under your Unison agreement, Unison’s Home Partnership Team works alongside Unison’s homeowners to help them navigate their homeownership journey, while making informed decisions and avoiding any pitfalls along the way.

 Unison’s talented team of experienced professionals is writing the playbook for home equity sharing management, developing industry-first technology and asset management strategies for unlocking the largest global asset class for investors and homeowners. We caught up with some of the team members - Theo Haugen, Director of the Home Partnership Team and Brandan Carlson, Senior Manager on the Home Partnership Team, to get an exclusive peek inside the Home Partnership’s game plan.

 <h4>Theo Haugen, Director of the Home Partnership Team</h4>
<h4>Why is it called the Home Partnership Team? </h4>
Unlike typical asset management, we’re not working with other professional firms and businesses or doing leases, we’re working with individual homeowners. When we’re invested with them, we really want to partner with them. We’re not managing what they do, but rather we're giving them access to better resources, better knowledge, better options so as they’re going through their homeownership journey they can make better decisions about their home, because that’s good for them and also good for us. 

 <h4>What should people know about the Home Partnership Team?</h4>
We’re a resource. Your relationship with us can last up to 30 years. During that time, if you’re ever unsure about something in your Unison agreement, something’s happened with your home, or there’s been an unexpected financial event and now you’re not sure how you’re going to pay your mortgage, just pick up the phone and call us or send us an email. Most of the time, we can direct you to resources to help you understand if you are making the most informed choices. That’s huge because home ownership can be hard to understand. We have a whole team of real estate and financial professionals at your disposal. Reach out to us when in doubt because we’re a resource for more than what you would expect.


 <h4>What are some questions you get from homeowners?</h4>
There are a lot of questions about home-related finances. What can I do if I can’t pay my mortgage? Can I refinance? Which lenders will help me refinance? Is this a competitive rate? We can help point out if their lender is charging outsized fees compared with what we typically see. We can direct them to other lenders who have worked with Unison customers and offered better rates. On the financial trouble side, COVID’s been difficult. We’ve seen homeowners who’ve gone into forbearance with their lender and then their lender says they will need to pay back everything they owe right when the forbearance period ends. What the homeowner doesn't know is that there may be other options for coming out of forbearance. We can help them work with their lender to make sure they are presented with all the options that are available.

 <h4>How long do you typically work with a homeowner?</h4>
We’re going to work with the homeowner for as long as it takes to navigate the issue, whether that’s a week, six months, or two years. The Unison agreement term is 30 years so we’re going to be here to help from the time you become a customer until your agreement is over. 

 <h4>Why is the Home Partnership Team important?</h4>
Life is hard and home ownership can be hard. Unexpected financial events can occur and deplete your resources, putting your home at risk. The Home Partnership Team can help. While we can’t always give you tailored specific advice, we can at least point you in the right direction to help you understand what your options are. Homeownership can be challenging and we want to help people succeed. 

 <h4>Brandan Carlson, Senior Manager on the Home Partnership Team 
</h4>
<h4>You started at Unison 5 years ago. What’s your experience been like?
</h4> I’ve been on an exciting and eventful ride here. I’ve made a ton of great professional connections, built a lot of good personal relationships, and I love the company and our mission, vision and values that we’ve put forth over the years and that we've committed to staying true to. I’m really excited about how big of an opportunity we have in front of us and how well we’ve previously executed on that, and so I know that the goals that we’ve set for ourselves in 2022 and beyond are absolutely reachable because we’ve executed on some of those already. 

 <h4>What’s the biggest shift you’ve seen since you’ve started working with the Home Partnership Team?</h4>
The biggest shift in mentality has just been brought about by sheer volume. 
When I first started, we had probably a couple of hundred customers with Unison agreements. So every challenge that came up felt like it was happening for the first time. Now we have close to 10,000 homeowner partners. We’ve seen it all before and we're experienced in helping homeowners with these issues. We’re also thinking of the big picture and have shifted our mindset to being proactive. Can we build automation to solve these problems in advance so they never come up? That’s what we’re thinking about now.


 <h4>How does the Home Partnership Team advocate for homeowners? </h4>
Our importance is magnified because our product is not well understood by the rest of the industry surrounding it. So we really have to advocate on the homeowner's behalf. For example, when the homeowner sells their house, we help educate the loan officer, title agent, or escrow officer involved because the way that home equity sharing works is different from how debt works. Everyone else assumes that anything you do with your house is debt because that’s how traditionally it’s always been, but that’s not true anymore. You can get different types of financing for your home and one day home equity sharing will be something that everyone is familiar with. For now, we do a lot of educating to ensure transactions go smoothly and advocate for our customers. 

 <h4>Describe the homeownership experience for Unison’s homeowners.</h4>
By the time you’ve reached the Home Partnership Team, you’ve received your funds from Unison and have used it for whatever purpose you intended it to be used for - consolidate debt, put kids through school, make repairs to your home. Unison's home equity sharing agreement has helped you to reach your financial goals, with no monthly payments or interest, and now the Home Partnership Team is your homeownership resource for up to 30 years...but we know unexpected stuff comes up like financial hardships or title changes -- or even routine things like refinancing your mortgage or working on a home remodel -- and the Home Partnership Team is here to help. Our mantra is that owning a home with Unison is better.

HPT team

The Unison Home Partnership Team answers your FAQs

Home Partnership Team FAQs | Unison Home Equity Sharing | Blog

Many people looking at Unison HomeOwner also check out HELOCs and other traditional options. Because no two individuals or situations are exactly the same, you need to know your options and make the decision that best fits you and your needs. 

So, what exactly is the difference between a HELOC and Unison HomeOwner equity sharing agreement? 

As you may know, HELOC stands for home equity line of credit, and it’s a type of capital (debt) you can access by putting up the equity in your home as collateral. The most fundamental difference between Unison HomeOwner and a HELOC is that a HELOC is debt, and HomeOwner isn’t. 

Once a lender issues you a HELOC you can borrow against it at any time. You pay interest on what you borrow, and your line of credit terms will determine when you need to repay the balance in full. Contrast this with Unison’s HomeOwner, which invests with homeowners and eliminates the need for new mortgages, monthly payments, and interest charges. 

HELOCs could a good option for people who want the flexibility of being able to borrow money when they want without having to deal with a large lump sum of cash all at once — and who also want the flexibility of repaying the money they borrowed on their own terms. However, some folks don’t want the additional costs of more debt on top of their existing mortgage loan. They don’t like the idea of having additional monthly payments. For those homeowners, Unison might be right. 

Unison HomeOwner will pay you up to $500K or 17.5% of your home’s value as a home co-investment. This is a one-time payment with no interest. Once approved the homeowner receives the payment to use however they like. After all, it’s their cash. Unlike a HELOC, HomeOwner has no monthly payments and no interest. In exchange for helping leverage their equity; customers provide Unison with a share in the appreciation of the home when they decide to sell, buy Unison out or 30 years pass. Because it’s a home co-investment, both the homeowner and Unison benefit if the home increases in value over the period of the contract, and both share in the loss if the home decreases in value.

<h3>What Are Some Other Alternatives To A HELOC?</h3>

HELOCs aren’t the only alternative to Unison HomeOwner. There are also home equity loans, home improvement loans, and cash-out refinancing. While these might work in a specific case, for people looking to avoid monthly payments and interest they won’t be right. Depending on the loan, you may need to be prepared to pay a higher interest rate or extra fees or closing costs. You also may need to have a certain amount of equity in your home, something not everyone can manage. 

The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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A HELOC can be right for people in a certain situation. But it's important to know that there are alternatives out there.

Is a HELOC Right for You? | Unison Equity Sharing | Blog

By Lauren Rosales, Content Writer

 Raise your hand if you have a cheap membership to Planet Fitness that you haven’t used in ages, but that you keep forgetting to cancel? It’s a hassle to go to the physical location, and so your subconscious continuously pushes it out of your mind. Each month you see the charge on your credit card bill, an innocuous but persistent $10.00. How did this happen?


 In March 2020, when the entire country seemingly shut down, gyms and fitness centers were at the forefront. Nothing says “contaminant” like a sweaty, shared elliptical or bench press–and in a poorly ventilated room, crowded with straining bodies, all panting vigorously, no less. Fitness classes were axed indefinitely, or at least, for the foreseeable future.
 

 Moreover, with enforced social distancing measures and urges to stay at home, regular incidental exercise (read: step counts) steeply declined. If you used to walk a quarter mile to your car before and after work, for example, you would lose that half mile of brisk walking every day when forced to work from home. Even strolling down the aisles of Target was light movement lost, as stores switched to pick-up and delivery services that kept you safely snug and stationary in your car or house. Indeed, smartphone-based apps indicated that within 30 days of lockdown, there was a <a href="https://doi.org/10.7326/M20-2665">global 27.3% decrease</a> in daily step counts.

 The results? Spoiler alert: as a people, we did not become movement-free amorphous beings (imagine the spacebound humans in Pixar’s WALL-E). People embraced <a href="https://www.nps.gov/yell/learn/news/20046.htm">hiking</a> and other solo or small group outdoor recreation, but perhaps the most marked result was the sudden rise of the home workout. Exercise classes migrated from the studio to <a href="https://link.springer.com/article/10.1007/s11332-021-00747-6">social media and communication platforms</a> like Zoom. From March to October 2020, health and fitness equipment revenue <a href="https://www.washingtonpost.com/road-to-recovery/2021/01/07/home-fitness-boom/">more than doubled</a> with sales of treadmills spiking 135% and those of stationary bikes actually tripling. Home workout equipment and subscription service mogul Peloton quadrupled its value to <a href="https://www.nytimes.com/2021/01/17/business/peloton-slow-delivery.html">more than $40 billion</a>. Many turned to <a href="https://www.sciencedirect.com/science/article/pii/S1469029221000960">online workouts or fitness apps</a> in order to stay active, the latter seeing a <a href="https://www.visualcapitalist.com/the-growth-of-home-fitness-apps-2020/">50% increase</a> in users between the first and second quarters of 2020.

 

 Unsurprisingly, people began to <a href="https://repositorio.iscte-iul.pt/handle/10071/24161">cancel their gym memberships in droves</a>. Two chains, 24 Hour Fitness and Gold’s Gym, sought <a href="https://www.nytimes.com/2021/10/19/business/fitness-industry-remote.html">protection from creditors</a>. Some gyms, like Planet Fitness, put membership fees on hold until gyms could safely reopen. But with a treadmill in the basement or a Peloton nestled into a niche of one’s home office, why return at all? If you forgot to cancel when the fees were put on hold, you might easily have continued to forget once they were reinstated–hence the situation outlined in the introduction to this blog post!



 Now that the vaccine is widely available and federal mandates have long expired, gyms have had ample time to reopen and test the waters, so to speak. And it turns out that not everyone is coming back. The Sports and Fitness Industry Association has found that Americans have largely eschewed the same activities that took them to fitness studios prior to the pandemic (think stationary cycling and cross-training); the fact that <a href="https://www.washingtonpost.com/business/2022/09/24/is-the-pandemic-over/">one in five clubs</a> shut down during that time has also not helped. Planet Fitness, clearly attuned to this change, recently partnered with the interactive fitness platform iFit to develop <a href="https://www.bloomberg.com/news/articles/2021-01-19/fitness-industry-may-never-return-to-its-old-ways-after-covid-19">workout content for a subscription plan</a> that does not require membership to a physical gym. The convenience and flexibility of at-home workouts are irresistible, though some continue to crave the social interaction of the locker room or the catharsis of the group sweat in a studio. But with exercise, the modern participant can have it all by embracing the <a href="https://www.wsj.com/articles/are-gyms-dead-why-home-workouts-are-here-to-stay-11611337770?mod=article_inline">increasingly popular hybrid model</a> in which they continue to work out at home but also pop into the gym–albeit occasionally. 


 
 If you appreciate the ability to sneak snatches of exercise into your everyday routine without the inconvenience of leaving the house, but are frustrated by the thrown-together vibes of your current home workout situation, there are ways you can purposefully improve it. Unless you really, truly love exercise, chances are that you sometimes feel like it is a bit of a chore. One way to work against this gloomy proclivity is to make your workout space into a place <a href="https://health.clevelandclinic.org/how-to-create-a-home-gym-youll-actually-use/">where you want to spend time</a>–or, at least, don’t dread it! So many home gym areas are relegated to dreary basements with little to no natural light, spiderwebs in every corner, and uninspiring concrete walls. If this is the case for you, how about brightening the space with a cheerful paint job, some shelves for spacial variety (and storage), or gym-mimicking mirrors? If you add a TV, you could also reap the benefits of streaming online classes on a bigger screen than that of your wee smartphone–or even throw on a binge-worthy TV show to coax you through longer sessions of cardio!


 
Part of making a space inviting is inevitably about keeping it tidy. While cabinetry would be a fab addition to a home gym space, even grouped baskets on the floor are helpful for keeping items like foam rollers, boxing gloves, resistance bands, jump ropes, yoga blocks, or hand weights <a href="https://www.nytimes.com/2022/01/04/realestate/build-a-home-gym.html">orderly and uncluttered</a>. A chair or a bench is a nice place not only to rest, but to toss a towel so that it doesn’t end up on the floor.


 
When it comes to stocking a home gym, you will obviously need to consider space and budget. Try not to feel compelled to buy all of the equipment at once. If you have the space for a treadmill or elliptical but not the cash, or the cash but not the space, you can still <a href="https://www.shape.com/fitness/workouts/how-build-perfect-home-gym">jump rope</a> vigorously for a solid cardio workout. Rather than immediately investing in a complicated weights machine, you might try using hand weights on a yoga mat, or doing Pilates with wrist or ankle weights. In fact, there are a cornucopia of exercises you can do purely by leveraging <a href="https://www.shape.com/fitness/workouts/bodyweight-training/best-bodyweight-exercises">your own bodyweight</a>! 


 
Whether you are a Peloton devotee or simply rolling out a yoga mat in your office for 15 minutes of Pilates during your lunch break, it’s immensely helpful to <a href="https://www.everydayhealth.com/fitness/9-simple-tricks-help-you-start-working-out-actually-stick-it/">have a routine</a>. If you have embraced the hybrid workout and vary your exercise between gym/studio and your own home, try to keep the variety consistent so that you don’t create excuses not to do any at all! 



 
There are <a href="https://www.better.org.uk/content_pages/top-gym-excuses#:~:text=A%20new%20survey%20by%20Better,has%20on%20their%20mental%20health.">many reasons</a> why you might detest going to the gym–there’s a reason that home gyms are <a href="https://candysdirt.com/2022/03/06/home-gyms-rank-second-for-todays-homebuyers/">considered a huge perk</a> by contemporary homebuyers! If you’re determined to take extra space in your home to create the perfect workout alternative, you might consider a <a href="http://unison.com">Unison equity sharing agreement</a> to help you to fund an extensive renovation. Unison can help you tap into your home equity for the funds you need to expand or alter your home, giving you cash now in return for a percentage of your home’s change in value when you sell it. Plus, if you work with licensed contractors and fully document the project, you may apply for a Remodeling Adjustment, which if granted would result in Unison subtracting any added value from its eventual share. Sounds good? <a href="https://www.unison.com/home-renovation/">Learn more</a> about using an equity sharing agreement to renovate your home today!


 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

pexels-cottonbro-4056510

Over two years into the “COVID Era,” this trilogy of blog posts considers the effects of the pandemic on particular aspects of homeownership. Now featured: the rise of the home gym. 

COVID and the Rise of the At-Home Workout

For those who are at least 62 years old, taking out a reverse mortgage is one way to supplement your income in your retirement years. As long as you live in the home and have a decent amount of home equity, you are likely to be eligible. However, these programs can be complicated and are not right for everyone. That’s why you should understand all the details before you make a decision.

Below, we explain how a reverse mortgage works, including how much it pays and how much it costs.

<h3>How Much Does a Reverse Mortgage Pay?</h3>
The amount of money you can borrow depends on how much home equity you have available. You typically cannot use more than 80% of your home’s equity based on its appraised value. As of 2018, the maximum amount anyone can be paid from a reverse mortgage is $679,650. However, most people will be paid much less.

The exact amount the reverse mortgage will pay you depends on a few different factors, including your age, the current home value, and your interest rate. The chart below shows how much of a difference these factors can make it determining the amount of equity you can tap into:
 
<center>
<table>
 <tr>
 <th> </th>
 <th>4% interest rate</th>
 <th> </th>
 <th>5% interest rate</th>
 <th> </th>
 <th>6% interest rate</th>
 </tr>
 <tr>
 <td>65 year old borrower</td>
 <td>49%</td>
 <td> </td>
 <td>43%</td>
 <td> </td>
 <td>38%</td>
 </tr>
 <tr>
 <td>90 year old borrower</td>
 <td>69%</td>
 <td> </td>
 <td>65%</td>
 <td> </td>
 <td>62%</td>
 </tr>
</table>
</center> 

<center>Maximum percentage of home equity that can be borrowed in a HECM (<a href="https://www.hud.gov/program_offices/housing/sfh/hecm" target="_blank">Source</a>)</center>

<h3>What Are The Different Types of Loan Payout Options?</h3>
When you get a reverse mortgage, you can choose how you want the loan amount paid out. That means you can get monthly payments or take it all in one lump sum.

Beyond that, there are other variations you can choose as well. You could choose a hybrid option, which includes both an upfront lump sum as well as monthly payments. Or you could choose a line of credit, where you can withdraw money as needed, up to a certain limit. It all depends on what you think will be the best fit for your unique situation.

<h3>How Does Your Payment Method Determine How Much You’ll Get Paid?</h3>
On the surface, it doesn’t seem like the payment method would affect how much you can get. However, getting paid out in one lump sum versus monthly payments could affect the principal amount of your loan. Keep reading to understand why.

Getting the entirety of your reverse mortgage amount all at once means you could be giving up some money in the future, whereas both the fixed monthly payment option and the line of credit option could pay out more to you over time if your home value goes up.

<h3>What Are the Costs of A Reverse Mortgage?</h3>
Because a reverse mortgage is a type of loan, there are various costs associated with taking one out. These include interest on the loan, the origination fee, and any set aside fees. Set aside fees include expenses such as getting your home appraised and making any repairs necessary to get your home approved.

An appraisal can cost anywhere from $250 to $1,000 depending on the size of the home and any complications that arise.

Interest rates fluctuate over time but if, for example, your rate is 5%, that means you’ll be charged 5% of the loan value every year – but you won’t need to pay this immediately. Instead, it will be assessed at the end of your loan term or when you sell the home.

The origination fee is charged by the reverse mortgage lender to cover their cost of processing your loan application. Usually the origination fee is equal to 2% of the first $200,000 of your home’s value and 1% of any amount above that, with a maximum of $6,000. If your home is worth $125,000 or less, the origination fee cannot exceed $2,500.

Here’s an example. If your home is valued at $350,000, you might expect to pay the following origination fee:

<center>$200,000 x 2% = $4,000</center>
<center>$150,000 x 1% = $1,500</center>
<center>TOTAL: $5,500</center>

<h3>How to Tell If It’s Worth It</h3>
Only you can tell if the costs of taking out a reverse mortgage are worth it and decide how you want the amount paid out. It’s a good idea to find an online reverse mortgage calculator and plug in some numbers to see whether the benefits outweigh the cons.

Before taking out a reverse mortgage, you should consider alternatives like the <a href="/homeowner_debt_relief">Unison HomeOwner</a> program. This program allows homeowners to unlock their home equity without monthly payments or interest charges. Instead, <a href="/">Unison</a> invests alongside you in the home, sharing a portion of any future change in the value of the home whenever you sell it – up to 30 years later. If your home increases in value, the company shares the gain. If your home decreases in value, the company typically shares the loss. You can <a href="/homeowner_debt_relief">learn more here</a>.

No program will be right for every homeowner. But if you’ve done your homework and can ensure you’ll be a responsible homeowner, tapping into your home equity could be well worth it.

The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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We explain how a reverse mortgage works, including how much it pays and how much it costs

Reverse Mortgage Details | Unison Home Equity Sharing | Blog

Four years ago, Rick was selling software to Fortune 1000 companies. Three years ago, he got laid off and was inspired to start his own business. Two years ago, he successfully launched <a href="https://www.firepie.com/">Firepie</a>, a different kind of pizza company. And less than one year ago, Rick used the <a href="https://www.unison.com/homeowner/">Unison HomeOwner</a> program to unlock equity in his home which has allowed him to re-invest in his company and take it to the next level.
How Rick Started Firepie – A Different Kind of Pizza Company
<img src="https://contentimages.o-prod.unison.com/images/testimonials/Rick_Firepie-e1526930279781.png">
Rick, the founder of Firepie

Rick is a small business owner with a passion for pizza – but not just any pizza. After learning the pizza business in his youth and learning about routing software via his job in the tech industry, he decided to bring those two concepts together. The result is Firepie, which delivers a wood-oven-cooked pizza in 15 minutes or less.

In 2015, Rick faced a moment of truth. He was laid off from his longtime job in the tech industry and dug deep within himself to figure out what his next steps would be. “In the winter of 2015 while sitting on my couch after being laid off, I had a moment to reflect,” said Rick.

In that moment, a voice from the past reminded him of his long-held dream of starting a pizza chain that would excel in fast delivery and convenience without compromising on quality. “It was my younger self, I think, gently reminding me that I had lost my way,” said Rick.

After experiencing this moment of clarity, Rick immediately got to work pursuing his dream. Over the next 6 months, he built the software that would power his business and used money out of his own pocket to turn Firepie into a reality.

The business, based in San Francisco’s Mission District and delivering to Bernal Heights and Noe Valley, took off and quickly began to grow. Rick’s model worked. Not only was he making delicious wood-fired pizza but he was delivering it to customers in 15 minutes. From his custom-designed pizza trailer housing a 900-degree Italian wood burning oven, he churned out lots of firepies and fed lots of happy locals.

There was just one problem: he needed more funding to take the business to the next level.

In Need of Small Business Funding

While Firepie was off to a successful start, Rick ran into problems when he tried to get traditional small business loans from the major banks and credit unions. Since his business was very new, nobody wanted to lend him the money he needed to continue growing.

<img src="https://contentimages.o-prod.unison.com/images/testimonials/Firepie_pizza-e1526930489620.png">
The Firepie wood burning pizza oven

Without additional funding, Rick knew that the business could not continue. At this point, the company was employing almost 15 people and had developed a very satisfied customer base. To lose the company at this juncture would have been heartbreaking.

That’s when Rick learned about Unison and the <a href="/homeowner">Unison HomeOwner</a> program. He realized that this program would allow him to tap into the equity in his home without having to make any monthly payments or interest charges. Unison would give him money upfront that he could use to grow his business, and in return, Unison would receive a share of any future gains (or losses) in the home’s value.

At first, it seemed too good to be true. But once he evaluated all the details of the program and weighed the pros and cons, he began to see that it was a perfect fit. “I was able to use the money that was locked up in my house, and it gave me the financial cushion I needed to expand the Firepie business,” he said.

Partnering with Unison and Growing Fast
With the money from Unison, Rick quickly invested in growing Firepie and expanding its operations and footprint. “I’m obsessed with convenience; in my heart I believe we all want (and need) more simplicity, quality, and convenience in our busy lives,” he said.

Today, Firepie is serving even more customers than last year and adding employees quickly to keep up with the demand. With sales increasing, Firepie’s revenues are growing and the business is healthy. Rick is even planning to launch a new Firepie location on the East Coast in the near future, making his long-awaited dream of a fast, delicious pizza chain a reality.

He is very grateful that the <a href="/homeowner/">Unison HomeOwner</a> program gave him the flexibility he needed to ensure that his business would succeed.
<img src="https://contentimages.o-prod.unison.com/images/testimonials/Firepie-featured-image-e1526929963306.jpg">
Unison will be rooting for Firepie on their journey to becoming a national brand, and we’ll continue to be grateful for our role in making it happen. You can find Rick and the team on Twitter @Firepiepizza. Don’t hesitate to reach out!

 
 
 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

firepie-testimonial

Thanks to a Unison equity sharing agreement, Rick was able to leverage his home equity to start the business of his dreams. 

Unison Helps Tech Worker Start a Small Business

By Jia Taylor, Content Marketing Lead

 The home improvement boom has been heating up for more than a year and doesn’t appear to be cooling down. <a href="https://www.unison.com/article/home_improvement_renovation_home_equity"> Home improvement</a> popularity grew immensely in 2020 during the coronavirus pandemic, largely due to Americans spending more time at home. According to statistics from the <a href="https://kitcheninfinity.com/33-home-improvement-industry-statistics/"> home improvement industry</a> in 2021, online searches related to home remodeling more than doubled from 2020 to 2021. Plus, more than half (52%) of American homeowners will spend $15,000 on home repairs in 2021. 

 As homeowners are investing in home improvements, eco-friendly solutions are factoring into many homeowners’ plans for updating their living spaces. Most green home improvement projects result in huge savings on your energy bills. Also, green home improvements can help <a href="https://www.unisonim.com/resources/resource-greenliving"> increase your home value</a>, and save you money in the long run, which can help when it’s time to resell in the future.

 We’ve rounded up 10 easy DIY green home improvement tips to transform your house into an eco-friendly home. 

 <h4>1. Switch to LED Lights</h4>
<img style="max-width:100%;height:auto;" src="https://contentimages.o-prod.unison.com/images/blog/diy/lights.png">

 For long-term savings of both money and energy, LED lighting is the way to go. LED bulbs have <a href="https://blog.constellation.com/2016/03/25/led-vs-cfl-bulbs/">triple the lifespan</a> of CFLs–25,000 hours vs. 8,000 hours–and are cheaper to power. Plus, unlike CFLs, they don’t contain any hazardous chemicals that require special disposal once they burn out. LEDs produce very little energy waste (heat), and substantially reduce energy costs when compared to halogens.

 Be sure that when you choose a LED light, pay attention to the color temperature. 2700k is a traditional yellow light close to a halogen bulb, 3000k is a popular modern choice that is slightly whiter but still soft, 4000k and above is bright and white. Depending on your space, you may need a different color temperature than you might have thought.

 <h4>2. Install a Programmable Thermostat</h4>
<img style="max-width:100%;height:auto;" src="https://contentimages.o-prod.unison.com/images/blog/diy/thermostat.png">

 A programmable thermostat can save you as much as 10% per year on heating and cooling by simply turning your thermostat back 7°-10°F for 8 hours a day from its normal setting, according to the <a href="https://www.energy.gov/energysaver/thermostats">U.S. Department of Energy</a>. Programmable thermostats can store and repeat multiple daily settings that you can manually override, which could be a huge energy saver.


 Regular thermostats can wear down the system since they overwork the units. However, a programmable thermostat can reduce the system’s stress by reducing the temperature swings during the day and night. Since this is easier on the system, it can also save money on HVAC repairs. 

 <h4>3. Use Magnetic Vent Covers</h4>
<img src="https://contentimages.o-prod.unison.com/images/blog/diy/vent.png">
<h2> </h2>

 If you’re trying to keep heat out of certain, unoccupied rooms in your house, magnetic vent covers may be a great way to make your home more eco-friendly. Magnetic vent covers redirect the airflow from the ventilation system to where it is needed most.

 The DIY magnetic vent covers are affordable and <a href="https://www.youtube.com/watch?v=8NssmzilIUo">easy to install</a> because they simply seal magnetically on top of your existing vent cover to block airflow. This simple change can have a big impact on your comfort level, improve your HVAC efficiency, and reduce energy costs. 

 <h4>4. Install a Low-Flow Showerhead</h4>
<img src="https://contentimages.o-prod.unison.com/images/blog/diy/showerhead.png">
<h2> </h2>

 If you take a shower for as little as 10 minutes with a traditional showerhead, you could be using up to 60 gallons of water. With a <a href="https://www.epa.gov/watersense/showerheads">low-flow showerhead</a>, the average is closer to 2.0 GPM (gallons per minute), reducing the volume of water used in a single shower to what was going down the drain before.

 When you use less water, less energy is going towards heating the reserves. This means less activity for your water heater and less electricity going towards keeping it running at high levels. Also, with a low-flow showerhead your water bill will go down substantially, with a reduction of nearly half the amount in some cases.

 <h4>5. Install a Low-Flow Toilet</h4>
<img src="https://contentimages.o-prod.unison.com/images/blog/diy/toilet.png">
<h2> </h2>

 Toilets use more water than anything else in our homes, nearly 30%, according to the <a href="https://www.epa.gov/watersense/residential-toilets">EPA</a>. By installing low-flow toilets, the average family could reduce toilet water usage by 20 to 60%, which means nearly 13,000 gallons saved per year. They could also save more than $140 per year in water costs, and $2,900 over the lifetime of the toilets. Use the <a href="https://www.epa.gov/watersense/watersense-calculator">EPA’s Watersense Calculator</a> to see how much you can save.

 You can convert any standard toilet into a low-flow toilet with simple changes and easily found tools. Before you start your DIY green home improvement project, don’t forget to check for <a href="https://www.unisonim.com/resources/resource-greenremodeling">leaks</a>. Converting your toilet into a water-saving device doesn’t mean much if you’ve got a leaky toilet. 

 <h4>6. Install Faucet Aerators </h4>
<img src="https://contentimages.o-prod.unison.com/images/blog/diy/faucet.png">
<h2> </h2>

 If water from your faucet is squirting to one side or you’ve noticed the flow of water has slowed to a dribble, then you might want to replace the aerator. A faucet aerator is a small, round device that you can screw onto the tip of your faucet to create a more consistent stream of water. Faucet aerators can reduce a sink's water flow by <a href="https://www.epa.gov/watersense/bathroom-faucets">30% or more</a>, from the standard flow of 2.2 GPM and can help to reduce energy costs.

 You can choose an aerator anywhere between 2.5 GPM to .5 GPM. An important thing to keep in mind is that the lower the <a href="https://www.thespruce.com/determine-faucet-shower-flow-rate-gpm-1824859">gallons per minute</a>, the longer it will take you to fill something up.

 <h4>7. Insulate your Water Heater</h4>
<img src="https://contentimages.o-prod.unison.com/images/blog/diy/heater.png">
<h2> </h2>

 Just like insulating your walls and roof, your home’s water heater can also be insulated, helping to improve energy efficiency and save you money each month. By essentially putting a "jacket" on your water heater, you can keep your water warmer during the cold months without having to use excess energy to heat it.

 If you have an older hot water tank, check to see if it has insulation with an R-value of at least 24. If not, consider <a href="https://www.youtube.com/watch?v=wEMjS1YNNYc&t=1s">insulating your water tank</a>, which could reduce standby heat losses by 25%–45% and save you about 4%–9% in water heating costs, according to energy.gov. You can find pre-cut jackets or blankets from home improvement stores for around $20.

 <h4>8. Install a Rain Barrel</h4>
<img src="https://contentimages.o-prod.unison.com/images/blog/diy/rain_barrel.png">
<h2> </h2>

 Love gardening? Install a rain barrel to collect water from your gutters to make your home more eco-friendly. Rain barrels collect rainwater from your roof by rerouting a section of your gutter’s downpipe into a barrel for later use, which reduces the amount of city water used to upkeep your yard.

 It’s also an easy DIY green home improvement project that is simple to install. The <a href="https://blog.epa.gov/2010/06/24/control-your-stormwater-and-save-money-use-a-rain-barrel/">EPA </a> estimates a single 55-gallon rain barrel can save you up to 1,300 gallons of water during the hot summer months. Plus, some cities offer financial incentives for using rainwater for irrigation as a supplement to municipal water.

 <h4>9. Install a Door Sweep</h4>
<img src="https://contentimages.o-prod.unison.com/images/blog/diy/door_sweep.png">
<h2> </h2>

 If you want to keep out the outside, install a door sweep. A door sweep is an easy DIY draft protection solution that attaches to the bottom of your door that eliminates the gap to provide an air-tight seal between your doorstep and your door. 

 Besides being unpleasant, door drafts force your heating system to work harder (and consume more energy) to keep your home at a consistently comfortable temperature. A door sweep is one of the cheapest ways to reduce <a href="https://www.energy.gov/energysaver/weatherstripping">energy costs</a> and boost your comfort, especially during cold months.

 <h4>10. Use Low-VOC Paint</h4>
<img src="https://contentimages.o-prod.unison.com/images/blog/diy/paint.png">
<h2> </h2>

 If you’re looking for a new paint color for your next DIY green home improvement project, consider low VOC paint. Traditional paint contains volatile organic compounds (VOCs), and gives off gas for years, contributing to air pollution and causing respiratory problems. 

 While it can be hard to pick the best product with paint aisles filled with “green” labels and non-toxic claims, one thing to check is if an eco-label certification is on a can, be sure it is an emissions test <a href="https://www.epa.gov/greenerproducts/recommendations-specifications-standards-and-ecolabels-federal-purchasing">approved by the EPA</a>.


 Starting your DIY green home improvement project now might be the best investment you can make, especially with a home equity sharing agreement from Unison. 
The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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Tips on easy DIY home improvements to help make your home more eco-friendly with energy efficient upgrades. Save money and lower your energy bills.

DIY Going Green Updates | Unison Home Equity Sharing | Blog

Buying your first home is an exciting time packed with fun decisions and new experiences. Our homebuyer glossary is here to help you feel confident and empowered by defining common real estate terms you’re likely to encounter as you navigate the home buying process. 

 <center><h3>Definitions</h3></center>
 
Escrow – Escrow is the process of using a third party (agent) as a neutral actor in the sale of a home. The escrow agent makes sure that the seller receives the money agreed upon for selling the house and ensures the buyer receives the house in return. Since there are so many moving parts involved in selling a home, the escrow agent is charged with remaining a nonpartisan middleman throughout the process. For instance, when the buyer writes an earnest money check (see below), that check will be given to the escrow agent and not the seller.
 
PMI – Private mortgage insurance is an extra amount paid on top of your mortgage and is generally required if you pay less than 20% of a home’s cost for the down payment, so it should be avoided whenever possible. This insurance favors the bank, not the homeowner, and is meant to alleviate the risk of the bank lending you more than 80% of the home’s price.
 
Earnest money – Earnest money is a sum (usually between 1%–5% of the home’s cost) paid from the buyer to the seller and held by the escrow company that represents the buyer’s serious intention to buy the home. Once earnest money has been paid, the buyer has a set amount of time to obtain financing for the home and handle other necessary tasks (perform an inspection, get an appraisal, etc.). If the deadline for obtaining financing is not met or if the buyer backs out of the sale, the earnest money will likely not be returned to the prospective buyer. If, however, the sale proceeds successfully, the earnest money will be rolled into the closing costs or down payment.
 
Fixed interest – If your home loan has a fixed interest rate, it means that the interest rate of the loan will never fluctuate. If you sign your loan at 3.8%, it will remain there for the duration of the loan.
 
Adjustable Rate Mortgage – An ARM loan means that the interest rate of your home loan will fluctuate with the market at predefined intervals (for example, annually). This is great if interest rates decrease, but it could become a problem if interest rates increase because your monthly mortgage payment will also increase.
 
Closing costs – Closing costs include a variety of fees paid for completing the purchase of a home, such as taxes, title insurance, homeowner insurance, and title search. Closing costs are normally 2%–5% of the total loan amount.
 
Down payment – A down payment is a portion of the total home price paid up front in one lump sum of cash. The higher the down payment, the smaller the amount of loan needed to pay for the remainder of the home’s cost. The recommended amount of down payment is 20%; this will allow you to qualify for the best loan rates and avoid having to pay PMI.
 
Home Equity Sharing – Due to rising housing prices, it may take a long time to save up the suggested 20% down payment to purchase a home. A home equity sharing company pitches in to help with the down payment. For instance, if a home buyer has 10% of the home’s cost for a down payment, a home equity sharing company will contribute the remaining 10%. At the end of the term, typically when the home is sold, the home equity sharingt company will receive an amount equal to its original investment and a portion of the appreciated value of a home. If the home has depreciated in value, the home equity sharing company may also share in the loss of value. Home equity sharing agreements are also available to homeowners looking to tap into their existing equity.
 
Broker – Brokers represent sellers and buyers of real estate. Brokers who work with buyers look for their clients’ dream home and assist with the buying process. Brokers who work with sellers determine the market value of the home, show the property, and help with other aspects of selling the home. Brokers normally have real estate agents working for them.
 
Real estate agent – A real estate agent is also commonly referred to as a “realtor,” and these agents work for a broker. They’re qualified to facilitate real estate transactions, and your realtor will be the one showing you homes and being your advocate throughout the homebuying process.
 
Home inspection – It may look like your dream home, but without a home inspection, it might actually be a nightmare. A home inspection is conducted on behalf of the buyer during the homebuying process. During an inspection, the inspector will investigate the condition of the home, from the plumbing and electrical systems to the foundation. The inspector will then provide a full home inspector’s report that details the findings.
 
Title – A title is the ownership document for a home. It’s similar to the “pink slip” showing ownership of a car.
 
Appraisal – An appraisal is a report estimating the value of the property, which may factor in how much similar properties have recently sold for . A home with an updated kitchen, for instance, will be appraised higher than an identical home in the same neighborhood with an older kitchen.
 
Lien – A lien is a legal right to someone else’s property. When you’re buying a house, you’ll need to make sure no money is owed on the property by the previous owner.
 
Closing – The closing is a meeting where all final documents involved in the purchase of the home are signed. During this meeting, the buyer will pay closing costs and the down payment.
 
Contingencies – Contingencies are conditions that must be met to successfully finalize the home purchase. The sale may be contingent upon a roof being replaced or the home being appraised at the sale price, for instance.
 
Equity – Equity refers to the portion of the home’s value that belongs to the homeowner, rather than the bank. In a purchase, it will generally equal the amount of the down payment.
 
Annual Percentage Rate – The cost of borrowing money for your home is the Annual Percentage Rate. APR considers interest as well as other finance changes associated with the loan. It is designed to help consumers compare the costs of different loan options.
 
Offer – This is the amount of money offered for a home by a prospective buyer. If, for instance, a home is listed for $200,000, a prospective buyer may offer $180,000. It is up to the seller to then accept or reject the offer. A stronger offer may include fewer contingencies (see above) or a higher down payment.
 
Mortgage Payment – A mortgage payment is the monthly amount you’ll pay for your home. It’s similar to paying rent, but the amount paid includes both the interest on the home loan and the principal (actual loan amount). It may also include amounts for monthly taxes and insurance depending on the lender.
 
Pre-approval letter – Before beginning the home search, a buyer should consider obtaining an estimate of how much a bank will lend them. The bank will determine how much it is willing to lend based on criteria such as income and credit.
 
There are several other words and phrases you’ll encounter as you buy your first home, but these terms are the most common. If you’re ever confused about anything during your home buying journey, just ask your realtor: he or she is there to help.

 The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.

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