Access Upfront Cash Without Taking on Debt by Leveraging Your Home’s Future Value

In a Nutshell: U.S. homeowners collectively hold $11.5 trillion of accessible home equity, yet high interest rates make using it a challenge for those with less than stellar credit scores. A home equity investment from Splitero gives you a lump sum of cash in exchange for a share of your home’s future value so you can pay down debt. The pressures of today’s high-interest economy box many out of debt-based home equity solutions. Splitero frees homeowners to leverage the value they have to create the future they want.

The high interest rates, limited inventory, and affordability challenges of today’s single-family housing market keep many homeowners locked into properties without much of an incentive to sell. Many have substantial equity that, ideally, they could use to generate cash through home equity loans and lines of credit.

The problem is home equity loans carry significantly higher interest rates than they did before the pandemic, and lenders and borrowers are having a harder time getting together. Homeowners with 30%, 50%, or more in equity find themselves out of the running for a reasonably priced loan unless they have a credit score of at least 720.

Loans also need to be repaid, but many homeowners aren’t prepared to make that commitment. Astonishingly, Americans now hold more than $1.14 trillion in credit card debt, a figure that has steadily risen since the pandemic.

And FICO, the company that licenses its widely used scoring model to the U.S. credit bureaus, reported that credit scores had declined for the first time in a decade.

The result is more debt left unpaid and goals left unrealized. U.S. homeowners today hold more than 11.5 trillion in available equity to support borrowing, with scant hope for many to access it.

Seeing these pressures coming out of COVID, Michael Gifford founded Splitero to provide homeowners with a non-debt-based home equity alternative: a home equity investment that provides upfront cash in return for a share of a home’s future value.

Homeowners gain liquidity with no monthly payment required in return. Splitero earns when owners repurchase its equity stake or when it’s time to sell.

“A low-rate mortgage is an asset at this point — we help homeowners keep those in place while accessing their equity in a way they can manage financially,” Gifford said. “We don’t have an income requirement or ask for tax returns, and we can work with homeowners all the way down to a 500 FICO score.”

Most of us who think and write about financial services are long past the notion that banks can solve all our problems. But this confluence of housing bottlenecks and higher costs for everything — including home equity loans — provides an unusually significant tailwind for Splitero.

Splitero is a West Coast company. It’s based in San Diego and is currently active in Arizona, California, Colorado, Oregon, Utah, and Washington. It announced in October 2024 that it’s planning a significant expansion through a $300 million partnership with Antarctica Capital.

“Antarctica will help us grow our business,” Gifford said. “This $300 million partnership will go a long way to help many families.”

Splitero targets most property types — think typical single-family homes in typical suburban neighborhoods — but shies away from homes with less than mainstream appeal. It’s the home’s investment appeal that wins the day, not the homeowner’s debt-to-income ratio.

“It usually takes about 10 minutes to apply, and all homeowners need is their driver’s license and their last mortgage statement,” Gifford said.

Homeowners typically need at least 30% equity to find a fit with Splitero. Many have 50% or more.

Property valuation is essential to this process. Splitero uses licensed appraisers, and Fitch Approved automated valuation models to prepare a valuation for the homeowner’s approval while clearing any title liens or judgments.

Homeowners typically receive 10% to 15% of their home value as cash upfront from Splitero. Spiltero then takes 20% to 30% of the home’s value at sale or option repurchase, an equity multiple of 2.0 in this example.

To protect homeowners during times of high property appreciation or faster repurchase scenarios, Splitero offers a homeowner safety cap. That safety cap is equivalent to a 19.99% APR per year.

“Ten percent now and 20% later makes it really easy to calculate,” Gifford said. “Whatever the future holds, we share in the home’s appreciation — or depreciation.”

A home equity investment from Splitero isn’t a loan. It’s the homeowner’s lump-sum payment from offering a stake in their home’s future value for sale to Splitero through an option purchase agreement. As we explain below, the details aren’t particularly complex, but the concept is unfamiliar to most people.

The credit score barrier is just the beginning of the frustrations homeowners experience during the home equity lending process. Qualifying can be cumbersome, bureaucratic, and invasive. It can also be time-consuming, with banks typically requiring a month or more from application to disbursement.

“While the cost of a home equity investment might be a little higher for homeowners who can actually qualify for a HELOC, the fact is that a lot of consumers just can’t qualify for those products,” Gifford said.

Splitero offers a Maturity Match™ to determine the option’s duration in lieu of a sale. Homeowners with 20 years left on their first-lien mortgages receive 20 years to repurchase.

Folks with less than 10 years on their mortgages still receive an entire decade of access to that cash before Splitero requires repurchasing.

“Our Maturity Match allows homeowners flexibility with their equity,” Gifford said. “It turns out that a lot of homeowners are interested in accessing cash without another monthly payment.”

Splitero helps homeowners get to a yes through a concerted effort to provide education and context for their decision from the first encounter to signing on the dotted line and beyond. Gifford is a veteran broker. Licensed mortgage originators educate consumers not only about home equity investments but all their other options.

That includes realistic pros and cons associated with today’s home equity lending marketplace and the specialized advantages of reverse mortgages.

Splitero backs up its team with copious online educational materials, including FAQs, step-by-step guides, disclosures, amortization tables, and a blog for a broader industry context.

“People can really see a clear picture of what’s going to happen in 10, 15, 20 years,” Gifford said.

Surprisingly, perhaps, the majority use case for a Splitero home equity investment is paying down debt.

The stats we cited above may give ample evidence of the breadth of the credit problem in America, but they don’t speak to the depth of the challenges households face daily, weekly, monthly, and beyond as they struggle to balance short-term needs with long-term goals.

“We actually see our homeowners’ FICO scores increase,” Gifford said. “It’s true debt relief, not consolidation to another debt source.”

The cost of living pressures we referenced above are a factor. Splitero homeowners may use their equity to finally put stubborn student loans to rest during their senior years. They may also use them to give younger family members — children and grandchildren — a chance at higher education free of student loans.

Home renovations and repairs are another popular use case. Once homeowners decide to make their homes truly forever, they turn to the upkeep necessary to produce the return on the property they feel they have coming.

Especially coming out of COVID, high-equity, low-mortgage rate homeowners see the advantages of redoing kitchens and bathrooms, upgrading landscaping, and whatever else is needed.

“We’re able to give them cash for that without asking for a monthly payment,” Gifford said.

When it does come time to sell, Splitero provides an internal brokerage, Splitero Homes, to provide greater goal alignment between sellers and brokers.

Splitero recently expanded to Arizona as of press time and plans gradual rollouts to additional U.S. states as it negotiates the requisite regulatory hurdles. Gifford said Splitero fits in the space between what home equity lenders can provide and what homeowners need. The Antarctica announcement underscores Spliteros’ fit wherever those spaces exist.

Customers appreciate Splitero’s onboarding ease and ongoing support. Many report being pleasantly surprised that what they think they learn about home equity investments from reading the Splitero website turns out to be true.

“It may be a newer product, but it’s not complicated — people can get their heads around it pretty quickly,” Gifford said. “We’re giving homeowners a better way to access the equity they’ve built up.”