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This Startup is Giving Home Mortgage Loan Providers a Run for Their Money

Co-own your home and retain 100% control while sharing in all the profits

Newsweek Amplify - Home Mortgages

Did you know that over 63% of all homes in the USA have outstanding mortgages? To be fair, mortgages are great and everything, except for the minor little inconvenience of having to pay them back (with interest). But what if there was a way where you did not have to pay back the money you borrowed if you didn't want to? If that sounds too good to be true to you, that's perfectly normal. You just probably haven't heard of Haus: the latest house financing alternative that provides you with the option of flexible repayments.

How Does Haus Work?

Newsweek Amplify - Home Co-Ownership

Haus works on a co-investing model. Put very simply in layman's terms, this means that when you take money from Haus in order to buy your house, you do not get a lender. Instead, you get a co-investor. Thus, effectively Haus invests in your home with you. For example, let's say your house costs 1 million dollars, $300,000 of which is put up by you and Haus comes up with the rest. Then you own 30% equity in your house, and Haus owns the other 70%. Sounds exciting enough? There's more.

As a co-investor with Haus, you have tons of advantages that you can avail, including:

  • Haus shares in any appreciation or depreciation with you. Suppose at the end of the year the house's market price jumps up to $1.1 million, then your 30% equity is now worth $330,000 now.
  • You're also allowed to increase or decrease your equity at any time by buying/selling from Haus. Continuing the earlier example, at the end of the year you can pay Haus $110,000 and increase your stake to 40% equity.
  • This also works the other way around and means that your investment will always be liquid because you can raise money off of it by selling your stake to Haus.
  • Another advantage is that you can sell off the property at any time, and both you and Haus will share in the profits based on your share of equity in the property. Suppose your house sells for $1.2 million, then you get $480,000 from it and Haus gets the $720,000.
  • Haus has a stake in any risk such as a decrease in the price, so in case things turn unfavorable, Haus shoulders some of the downsides, thus reducing your losses.
  • They have very flexible payment options, and your payments for 10 years will be fixed with amounts as low as possible. Since Haus has a stake in the appreciation of your property value as well, they can offer you deeply discounted payment options and flexible terms, which is another huge win.

Who Is Haus For?

Newsweek Amplify - Who is Haus for?

Haus provides an affordable and transparent alternative to bank mortgages, thus making the entire process of having to borrow (if co-investing with Haus can really be called borrowing) a lot simpler and more straightforward. Their aim is to change the real estate industry, thus giving more power to the little guy, which happens to be any and all of us. We all know that one person who's been getting crushed under their mortgage payment obligations, and this provides a welcome respite from that.

Haus treats you and your house as an investment rather than a cash cow. Their model has been helping several thousands of millennials at a time when housing prices are skyrocketing and people already have student debts to contend with. Houseowning rates dropped by 9% over the last decade, and 20% of this decline can be attributed solely to student debt, according to the Fed. The transition from renting to now owning homes has not been easy for most, and several people take on massive mortgages without properly understanding the responsibility it entails. Haus is mainly for these millennials who wish to own homes but don't want to double down on their debt. However, the ultimate goal of Haus is to look out for the little guy, so even if you're not a millennial, feel free to sign up and save thousands of dollars, not to mention a lot of tension, with Haus.

What Does the Process Look Like if You Already Have a Mortgage?

Newsweek Amplify - Co-ownership Process With Haus

In case you're interested (who wouldn't be?), it might be useful to understand how the process works exactly, so you can make your decision. For those who already have a bank mortgage that they're looking to get out of, first, you'll have to sign up with Haus for an account. Since Haus is only a co-investor, they won't have their name on their title, and any equity that you have will be yours to keep. Then, Haus will begin to make mortgage payments to your bank on your behalf, and at the same time, you'll be making a deeply discounted payment to Haus, which will definitely be less than your mortgage. (As a bonus, since the payment is being made on your behalf, you still get your interest deduction while doing taxes!)

Gradually, as the months go by, you'll keep repaying Haus and increasing your equity in the property. As an alternative, if you suddenly win the lottery, you could also make a lump sum payment and boost your equity. Your Haus dashboard will provide you with insights on the current market value of the property as well as the equity you currently own. The usual tie-in period is 10 years. Once those 10 years are up, you then have several options: you could choose to either continue paying them monthly and increase your equity gradually, purchase it outright, or sell it and split the profits with Haus.

Convinced? We're guessing not. After all, this is a huge decision to make based on just one article. Worry not, though. You can head over to their website, sign up, and talk to their experts on whether or not this will be the right fit for you. They also have an estimate calculator that can tell you their valuation of your property, which is useful information to know before you commit. Word of advice: Read the fine print. Whether it's a co-ownership with Haus or a bank mortgage, it is essential to know exactly what you're getting yourself into, to avoid any nasty surprises later.

Could co-ownership get you out of your mortgage? Sign up with Haus for free and learn more.

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