Hometap receives commitments totaling $245 million
Hometap, which provides a new loan alternative by tapping into home equity, announced that it has received capital commitments of $245 million from investors including Bain Capital and Group 1001’s Delaware Life Insurance Company, and other of its affiliated insurance companies, to its latest institutional asset investment fund. The new fund is Hometap’s third institutional investment vehicle and will be the largest to date.
Hometap’s institutional fund is designed to bring its home equity investment product to more homeowners while also giving investors the opportunity to diversify their portfolios and participate in the U.S. residential real estate asset class.
Hometap allows homeowners to receive debt-free cash in exchange for a share of their home’s future value. Homeowners can use the cash to meet a variety of needs from paying off credit-card debt to starting a business to buying a second home. When the home sells or the homeowner settles the investment, Hometap is paid out an agreed-upon percentage of the sale price or current appraised value.
The startup is backed by a variety of investors including American Family Ventures.
“While homeowners have been fairly limited in the past when it comes to financing options, the landscape is changing for the better, with innovative solutions emerging that prioritize flexibility and ease. We’re excited to be able to offer more homeowners a fast, debt-free alternative that will deliver on our mission to make their lives less stressful. We’re also thrilled to be building an attractive asset class that provides both diversification and inflation-hedging benefits for institutional investors. It’s incredibly rewarding to work with capital partners who are as committed to helping homeowners, supporting our mission, and doing good in the world as we are.” – Hometap CEO Jeffrey Glass.
“We believe Hometap provides homeowners with a compelling, debt-free financing alternative and investors with a diversified, attractive relative value way to make a long-term investment in U.S. residential assets. We are proud to partner with the Hometap team as they bring value to more homeowners across the country.” – David DesPrez, Director at Bain Capital.
“With a growing number of homeowners seeking creative ways to access their home equity, Hometap offers an attractive, debt-free solution that we are proud to support. This is a compelling new asset class that fits within Group 1001’s mission to offer useful and intuitive financial products accessible to everyone, and we recognize the significant opportunity for Hometap to continue to institutionalize this market. It not only empowers homeowners to benefit from the equity they’ve built in their homes, but also allows investors to gain exposure to residential home price appreciation in a unique way.” – Justin Ostroff, senior managing director of G1001 Innovation Group.