No monthly payment, real cash in hand—what’s the catch? Tim Lucas and Craig Berry break down home equity agreements (HESAs), where you trade a slice of your home’s future value for money today. Using a $750k-home example that yields $75k now and about $180k back in 10 years (roughly ~9.1% APR with 3.5% annual appreciation), they unpack who these deals fit—and where they can bite.

• Why people use them: Self-employed, retirees, or credit-rebuilding owners who need cash without new monthly debt—especially with 8–9% HE loan rates.
• Pros: No monthly payments, flexible exit (sell, refinance, or buy out early), some downside protection if prices fall.
• Cons: You give up appreciation, 3–5% upfront fees, a recorded lien, and potential predatory offers—read every clause.
• Smart moves: Compare the effective APR vs. HELOC/HEL, verify the valuation method, learn the early buyout formula, cap the share of appreciation, and get 2–3 quotes plus advice from a HUD-approved counselor or your CPA.

Read the full article:
https://www.mortgageresearch.com/articles/home-equity-agreement/