Hometap Mortgages Terms & Requirements
Just like any type of home equity company, Hometap has some terms and requirements in place that you should be aware of before you proceed any further with an application.
Hometap generally caters to a wide-ranging audience, including people who might not qualify for traditional types of financing. However, there are some requirements in place. Hometap will usually only deal with applicants with at least 25% equity in their home and have a record of making insurance and mortgage payments on time.
It usually prefers homeowners to have a FICO score of more than 600, with the absolute minimum being 500. Hometap generally will provide funding sums of between $15,000 and $600,000. It also only deals with people in certain states. Finally, the max loan to value (LTV) that Hometap will deal with is 75%.
You are able to get cash of up to $600,000 from Hometap as a result of tapping into your home equity. This sees the homeowner exchange a percentage of the home’s future value.
There is no rule in place as to how you use the funds. Naturally, the homeowner will need to keep making their mortgage repayments, pay property taxes, keep the home in good condition, and keep paying homeowners insurance as part of the HomeTtap agreement.
You do not need to pay any interest or monthly payments if you use HomeTtap to tap into your home equity. However, there is a 3% servicing fee of the total investment amount in place. There is also a 10-year effective period for this type of home equity option.
When you settle this investment at that date or before it, Hometap gets a payout of the initially agreed percentage of the home’s current value or the sale price. There are no early settlement penalties in place. You are able to settle with Hometap through refinancing, a buyout, or selling the home.
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