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Advocates warn on high-cost home equity investment offers and disclosures
HousingWire says home equity investment products can cost about twice as much as a HELOC, and the terms may force a sale or another loan if homeowners cannot buy back their equity within 10 years.
HousingWire highlights what it describes as recurring consumer risk issues in real estate, pointing to rising promotional offers for home equity investment products that are marketed to borrowers who may not qualify for a traditional refinance or HELOC.
The outlet says home equity investments remain largely unregulated federally, and with the CFPB described as weakened, states are trying to set basic guardrails. HousingWire also warns that these products can carry an effective cost that is about twice that of a HELOC, and that common terms require homeowners to sell or take out another loan if they cannot buy back their equity stake within 10 years.
HousingWire adds that it is also seeing concerns with mortgage brokers who, in the outlet’s view, do not actually shop around for options, underscoring the need for clearer disclosures and more transparent explanations to consumers.
The piece argues that consumer advocacy work matters for clients’ well-being and their wallets, especially when sales incentives and fine print can obscure costs and time-sensitive obligations.