A San Francisco-based company is offering a new way to tap your home's equity that doesn't involve a loan. REX gives you money now in exchange for a percentage share of the future appreciation.
The next big thing in loans isn’t a loan at all.The REX Agreement is not a loan, but a real estate investment agreement in the form of a purchase option. It gives homeowners a portion of their home’s equity in cash today—in exchange for the right of REX & Co. to share in a specified percentage of the future increase or decrease in the home’s value.
For the right to share in an agreed upon percentage of the future change in value of the home, REX & Co. pays the homeowner what is called an Option Exercise Price—equal to the current value of the home multiplied by the percentage of the future change in value granted to REX & Co. If the home increases in value, REX & Co. shares in the gain. If the home declines in value, REX & Co. shares in the loss. Simply stated, there is nothing like the REX Agreement in home finance.
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