How These Are Actually Used
Illustrative situations, not customers. The shares come from the Urban Institute’s February 2026 study of 54,044 shared-equity agreements, so what you read here is what the research found, not a story we wrote.
Get My Free EstimatePaying down higher-cost debt
The most common reason by a wide margin. A homeowner carrying credit card or personal-loan balances has equity but cannot, or would rather not, add a monthly payment to service it.
How it works
The balances are cleared at closing. Nothing is due month to month on the Agreement itself, so monthly outgoings fall by whatever those payments were.
What that means at settlement
The obligation has not gone away — it has changed shape, from a monthly payment to an amount due at settlement that depends on what the home is worth then.
Remodeling or repairing the property
The second most common use. Work that cannot wait, or a renovation a homeowner would rather not finance with a second lien.
How it works
Funds are available at closing with no restriction on how they are spent, and no draw schedule or contractor approval.
What that means at settlement
If the work raises the home’s value, the capital provider’s share at settlement rises with it. Improvements do not reduce what is owed — they can increase it.
Everything else
Medical costs, education, a business, or simply reserves. Roughly a third of homeowners arrive after a mortgage route closed: 35% of equity-extraction mortgage applications were denied in 2024.
How it works
Qualification rests on the equity in the property rather than on income documentation or credit score, which is why it reaches people a second mortgage does not.
What that means at settlement
Not qualifying elsewhere is a reason to compare carefully, not a reason to skip the comparison. In a strongly appreciating market the effective cost can exceed a home equity loan.
What homeowners report going wrong
The Consumer Financial Protection Bureau has recorded complaints about home equity contracts as a category. These are the recurring themes, and they are worth reading before you decide anything:
- Confusion about the financing terms
- Surprise at the size of the repayment amount
- Disputes about appraisal values
- Difficulty refinancing while the agreement is in place
- Feeling that selling the home was the only way out
Sources for this page: Laurie Goodman and Katie Visalli, “How Shared Equity Products Work, Who Is Using Them, and Regulatory Recommendations,” Urban Institute, February 2026. Shares are of the 54,044 agreements in that study’s provider dataset and describe the industry, not Mend. Complaint themes are the CFPB’s, as reported in the same study.
How Homeowners Use Their Funds
Across 54,044 shared-equity agreements studied by the Urban Institute, paying down higher-cost debt accounts for most of them. These are industry figures, not Mend’s. We are not yet in a position to publish our own, and borrowing someone else’s numbers while implying they are ours is how the previous version of this page went wrong.
No Restrictions on Use
Unlike some financing options, there are no restrictions on how you use your Home Equity Agreement funds. Common uses include:
- Paying off high-interest debt
- Home renovations and repairs
- Starting or growing a business
- Funding education or medical expenses
- Supplementing retirement income
- Making investments
- Emergency fund or cash reserves
See what this would look like for you
A Home Equity Agreement has no monthly payments. A Final Settlement Amount based on your home's value at that time is due at the end of the Investment Period or upon sale or refinance. In a high-appreciation scenario, this amount may substantially exceed the investment proceeds received.
A preliminary estimate takes about two minutes, with no credit impact and no obligation.
Get My Free EstimateCustomer stories are based on real experiences but names and identifying details may have been changed to protect privacy. Individual results vary based on personal circumstances, home value, equity position, and market conditions. The outcomes described are not guaranteed. Statistics are based on internal data and customer surveys.