HOUSINGNEWS REPORT
LEAD ARTICLE
Our Unison HomeBuyer program can double a buyer’s down payment cash, which can eliminate the need for costly mortgage insurance and significantly lowers the monthly mortgage payment (typically by 15-20 percent). This monthly payment savings can make it far easier to income- qualify for a mortgage loan.”
JAMES RICCITELLI
CO-CEO, UNISON HOME OWNERSHIP INVESTORS, SAN
FRANCISCO, CALIFORNIA
tailored specifically to these out-of-the- box buyers.
explained. “The client can use the capital for up to 30 years. Unlike debt-based programs, such as mortgages and home equity loans, there are no interest charges or monthly payments. Instead, Unison’s investors earn a return by sharing in the change in value of the home, up or down, when the homeowner decides to sell — up to 30 years later. As partners, we win or lose together. If the home value rises, the homeowner and the investor both profit. If the home value falls, both lose.” Riccitelli said his program can significantly change ownership economics by helping buyers qualify more easily for mortgage financing. “Our Unison HomeBuyer program can double a buyer’s down payment cash, which can eliminate the need for costly
to then pay the bills each month. This way the mortgage company, utilities, and repair professionals each get just one check and life is simplified for everyone. There must be an owner-occupant. If the owner-occupant leaves the property then by definition shared equity comes to an end. Instead there is now an investment property with several owners. Co-Funding Alternatives While financing shared equity purchases is possible with traditional loan programs (see sidebar on Page 7), the out-of-the-box nature of buyers in need of equity sharing can make traditional financing a challenge. In response, a growing number of companies — most of them startups — are offering a new breed of equity sharing programs
The shared-equity concept is generally seen as having a resident owner, a non- resident owner, and two names on both the title and the mortgage. However, these emerging co-funding programs parallel shared equity but use different financing and ownership approaches. Jim Riccitelli, Co-CEO of San Francisco- based Unison Home Ownership Investors, said his company offers programs in more than a dozen states for both purchasers and existing owners. With Unison the resident owner alone is on the title and the company obtains a profit or loss only when the owner elects to sell, an ownership term which can last as long as 30 years. “Unison provides long-term investment capital to homeowners,” Riccitelli
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JULY 2017 | ATTOM DATA SOLUTIONS
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