Short answer. No, not in how it's built. A company pays you cash now and gets a share of your home's future value instead of interest. But treat it with the same care as a loan: in our model it costs 13.7% to 15.9% a year in a typical case, and Connecticut, Illinois, Maryland, and Maine regulate these agreements under their mortgage or consumer credit laws.
HEI vs a loan, side by side
| Home equity investment | HELOC or home equity loan | |
|---|---|---|
| Monthly payment | None | Yes, from the first month |
| Interest | None charged | A rate, fixed or variable |
| What you repay | A share of your home's value (or gain) when you settle | What you borrowed plus interest |
| Cost depends on | How much your home grows and when you settle | The rate and how long you borrow |
| Qualifying | Equity, credit minimums from 500; some providers don't review income | Credit, income, and debt-to-income |
| Secured by your home | Yes, typically with a lien | Yes |
| If your home loses value | You may repay less | You still owe the full balance |
What an "HEI loan" really costs
Because there's no interest rate, the cost hides in the share you give up. Converting it to a yearly rate makes it comparable to a loan. Across the six major providers, for $100,000 on a $750,000 home with a $300,000 mortgage:
- Typical case (4% yearly growth, settle after 7 years): 13.7% to 15.9% a year.
- Flat home prices: 3.5% to 13.0% a year.
- Fast growth (8% a year): 13.7% to 23.1% a year.
- Selling after 3 years: 14.7% to 22.7% a year.
For comparison, we use 8.5% a year as a reference HELOC rate. If you can get a HELOC or home equity loan, it will usually cost less. Run your own numbers on the calculator, or try a single provider: Hometap, Point, Unlock, Splitero.
Where states treat HEIs like loans
Providers describe HEIs as investments, not loans. Some states disagree, at least for licensing and consumer protection:
- Connecticut: Connecticut's banking law defines shared appreciation agreements and includes them in "residential mortgage loan" for licensing purposes (General Statutes ยง 36a-485). (tracker, source)
- Illinois: Amends the Residential Mortgage License Act so that a "mortgage loan" includes one in which funds are advanced through a shared appreciation agreement. (tracker, source)
- Maryland: Makes certain shared appreciation agreements subject to the Maryland Mortgage Lender Law and other laws regulating consumer credit, and authorizes the Commissioner of Financial Regulation to adopt rules. (tracker, source)
- Maine: An emergency law, effective when signed, that treats "shared appreciation mortgage loans" as mortgage loans under Maine's Consumer Credit Code and treats their providers as supervised lenders. (tracker, source)
Massachusetts has gone further in court: its attorney general sued Hometap in February 2025, alleging among other things that it made mortgage loans without proper underwriting and charged unlawfully high interest. The case is pending. (tracker)
Federally, Home Equity Lending Integrity Act (S. 4803) would add home equity investments to the Truth in Lending Act's definition of a residential mortgage loan. It is pending. (tracker)
See every state on HEI Facts.
"HEI loan" reviews
For independent reviews of each provider, with costs computed the same way, see HEI Compare's reviews. For complaints filed with the CFPB and lawsuits by provider, see HEI Facts.
Frequently asked questions
Is an HEI a loan?
Not in structure: there's no interest and no monthly payment, and you repay a share of your home's value instead of a balance. Some states, including Connecticut, Illinois, Maryland, and Maine, regulate these agreements under their mortgage or consumer credit laws.
What is the interest rate on an HEI loan?
There isn't one. Converted to a yearly rate, the six major providers cost 13.7% to 15.9% a year in our typical example, and more if you sell early or your home grows fast.
Do you have to make payments on an HEI?
No monthly payments. You settle in one payment when you sell, refinance, buy out the provider, or reach the end of the term. You still pay your mortgage, property taxes, and insurance.
Can I get an HEI if I can't get a loan?
Often, if you have enough equity. Published credit minimums start at 500, and some providers don't review income. See which providers fit you.