Will my estate and I always be better off with EquityKey?

Real estate is like any other investment; it can go up or down in value. Because of this, there can be no guarantee that the amount you receive from EquityKey will be equal to or greater than the profits you or your estate would have earned from future appreciation in your home had you not entered into an EquityKey transaction.

In some instances, a dramatic rise in the real estate market and the value of your home could mean the value of the appreciation you have sold will exceed the amounts you received from EquityKey.  In other instances, if real estate remains flat or there is a “dip” in home values, EquityKey may end up having paid you more than we earned through appreciation.

Why does EquityKey Charge a Acquisition Cost?

In the circumstance where EquityKey purchases the home, it will become the new owner of the residence. The residence now has to be made ready for sale and ultimately listed for sale to another party for EquityKey to realize any return. Both the cost of making the home sale-ready and listing with a real estate agent will be costs that EquityKey must pay. The Acquisition Cost is how EquityKey offsets the expenses of settling your estate, if needed. EquityKey considers the Acquisition Cost fair in charging you the actual third-party costs to sell it. EquityKey will hold 8% of the fair market value when paying out the estates share. After the estate has been sold, we will reimburse the difference (of the actual sales cost versus the 8% we with held) to the estate.

Please refer to the EquityKey Investment Agreement and your own financial advisor, tax planner or legal counsel to see how your estate may be affected by the EquityKey opportunity.

What other fees might apply?

There are no upfront fees with EquityKey, only a small deposit of $300 that is refunded should the client complete the transaction and be an EquityKey participant, or does not qualify for the program. 

You or your heirs will have costs in the future if you were to sell your house. Therefore, if, at the end of the agreement's term, we acquire your property, we will charge an acquisition cost equal to our actual third-party costs to sell it. This will never be mre than 8% of the fair market value of your house at that time.  When the house is being settled and we pay off your estate, we will hold 8% of the proceeds to settle the estate, and the difference after the house has been sold will be issued to your estate.

Please refer to the EquityKey Investment Agreement and your own financial advisor, tax planner or legal counsel to see how your estate may be affected by participation in the EquityKey program.

Why might one spouse be considered and not another?

In order to manage its risks and create the liquidity needed to purchase the home, EquityKey must purchase and hold a life insurance policy on all participants. If a person is uninsurable or the cost of coverage is too high, he or she might not qualify to participate in the EquityKey program.  Additionally, the clients themselves may want to hold on to some of the appreciation of the property, and thus choose to only have one spouse participate, pledging 50% of appreciation to EquityKey.

Can I get a reverse mortgage or other loans against my house if I participate in the EquityKey program?

While forward mortgages are allowed up to a certain loan to value limit, reverse mortgages should not be expected to be available to participants in the EquityKey program. This is because reverse mortgage lenders require that they be the only lien on your property, with recourse to not only the existing equity in your home, but also to any potential growth that might occur. As part of your contract with EquityKey, EquityKey files a performance deed of trust with you in the appropriate government office. This means that potential future lenders to you, from whom you may want to borrow using your equity as security, will see our filing, and may not want to lend any amounts to you.

Please be sure to have your counsel and/or your tax advisor review the EquityKey Investment Agreement. While EquityKey personnel will be happy to answer any questions you may have regarding the terms of the contract, neither EquityKey nor any of its sales agents are your financial or personal advisor, and you should not rely on them for advice as to whether this product is appropriate for you or your family.

What happens if I don’t fulfill my obligations in the contract?

If an EquityKey client fails to keep his or her end of the bargain, EquityKey may exercise its option before the client’s passing to recoup its investment. The EquityKey contract is a legal, valid and binding agreement and, just like in any other binding contract where one party fails to meet its obligations, a lawsuit may be filed against a client in breach to recover any losses. These same rights are afforded to EquityKey if a client has breached its obligations under the EquityKey Option agreement and the amount EquityKey receives after purchase of the client’s home and its resale in the market is less than the amounts it has paid to the client.

*If, at the end of your agreement term, EqutiyKey acquires your property, we will charge an acquisition cost equal to our actual third party costs to sell it. This cost will never be more than 8% of the fair market value of the house at that time. There can be no guarantee that participation in the EquityKey program is suitable for you. Please consult your own legal counsel, financial advisor, tax planner and any heirs to your estate before making a decision to participate in the EquityKey program.