Additional Benefits of Equity Sharing
Equity sharing offers benefits to the home buyer, including a smaller loan, a lower interest rate, a tax deduction and the potential to purchase a superior property. Depending on your situation, you may also recognize additional benefits from co-owning property with an investor.
First-time Buyers
Most potential first-time buyers are currently paying rent. Property co-ownership allows the first-time buyer to stop paying rent and use that same money to start building equity in real estate.
Step-up Buyers
If you’re considering upgrading to a larger property or a better location, you can combine the value of your current home equity with cash from an investor to make it possible.
Disrupted Buyers
Should your financial situation suddenly change due to divorce, job loss or the loss of a spouse, property co-ownership may provide a solution. By pooling funds with an investor you may be able to remain in your current property or move into a comparable property in or out of the area.
Resource-Constrained Buyers
If you simply lack the credit or cash you need to move into the type of house you want with a loan you can afford, then buying real estate with a partner may be the solution. By pooling resources you can reduce the amount of cash you need up front, minimize the amount you need to borrow and potentially qualify for a more favorable interest rate.
Co-Occupiers
Sometimes equity sharing is done between two or more people who live in a house or share a vacation home. If you’re looking for someone to share a house with you, you can indicate this preference when you create your Home Equity Share profile. We provide a special Equity Share Calculator™ and special agreements for use by home co-occupiers. If you already have a house mate in mind, you can develop preliminary terms using the Co-occupier Equity Share Calculator™.
Now that you’ve reviewed the many benefits of equity sharing, it’s important to consider the potential risks before you proceed to enter into an agreement.
