Program Guide WHAT WE DO Owning a home is big investment. Unison helps you free up cash by tapping into your home’s equity. And we do it without any of the downsides associated with traditional lenders. HERE’S HOW We offer a smart alternative to a traditional loan or line of credit by letting you convert existing equity in your home to cash. Unlike a loan, with a Unison co-investment there are no monthly payments or interest charges. We’re able to do this by extending a cash payment to you today in exchange for an option to share in your home’s change in value, up or down. You make no payments to us until you sell your home or 30 years pass. At that time, we’ll settle up based on the value of Unison’s option, and you’ll owe us an amount equal to the cash payment we gave you, plus or minus a percentage of your home’s change in value. LEARN MORE Curious about how our program works? Want to see the math? Keep reading and we’ll walk you through the basics. WHAT IS UNISON? How It Works 1. We give you a cash payment for up to 17.5% We’re a San Francisco-based real of your home’s current market value. estate investment company that’s 2. You use the money however you want. been helping homeowners since You do not make any payment to us until you sell your home (or 30 years pass). 2004. 3. Ready to move? Great. When the sale goes All of us are committed to common- through, you’ll make a single payment to us from the sale’s proceeds. Regardless of whether your sense alternatives to debt financing home’s value goes up, down, or stays the same, and our leadership team are all well you will benefit. We’ll show you how on page 8. seasoned, highly respected real estate finance professionals. What’s The Catch? The short answer: There isn’t a catch. So, how do Our work has earned us accolades we survive if we’re waiting upwards of 30 years for from national publications, including: our investments to come back? Are we just really patient people? Actually, yes. Our investors are big institutions (think university endowment funds, pension The Wall Street Journal, The funds, etc.) with patient capital focused on a long term New York Times, and Forbes. investment horizon. This is why we can offer our money for up to 30 years without monthly payments or interest charges. Take A Good Close Look We want you to make the best decision for you and your family. And while we do our best to explain everything, we highly recommend you carefully review the Unison HomeOwner Agreement and other information about our program available online. It’s a good idea to do this with family members, as well as with your legal and financial advisors. In fact, we advise you to do so. Your Program Specialist will be happy to provide you with all the documents necessary. 1 | 1.800.330.9400 | Speak to a Unison Program Specialist Your home equity is yours. Use it when you need it. 2 | 1.800.330.9400 | Speak to a Unison Program Specialist Table of Contents WHAT’S INSIDE? The Basics: Unison 101 4 Determining Your Home’s Change in Value 9 Sample Scenarios 10 What Ifs? Remodeling, Home Maintenance and Restrictions Before the Third Year 17 Unison HomeOwner Requirements 21 Refinancing 22 Ending Your Unison HomeOwner Agreement 24 Legal Documents 26 Ready to Work With Us? Next Steps 28 NOTE: The examples we provide in this guide are only examples. The specific package we offer you may vary due to a few factors, including: a) your property’s value b) your credit history c) your financial profile and d) the packages we’re able to offer at that time. We will always let you know (in writing) exactly what you’re being offered prior to final approval of your application. 3 | 1.800.330.9400 | Speak to a Unison Program Specialist CHAPTER 1 The Basics: Unison 101 When we begin working together, we give you a cash payment. We call this payment a co- investment because it allows us to be invested in a percentage of your home’s future value alongside you, up or down. Choosing to receive less money from us today means the percentage we share in will be lower, and choosing to receive more money means that percentage will be higher (pages 6-7). We’ll let you know what you qualify for, the amount you choose to unlock is for you to decide. Once you receive your payment, you’re free to do whatever you want: fund a remodeling project, pay for tuition, start a business, etc. Until you sell (or 30 years pass), there won’t be much interaction with us - unless you need us. All you need to do during that time is keep your home in good repair and stay current on your mortgage, real estate taxes, insurance, etc. You’re still the owner of the home, so all the advantages of owning are completely yours, including any tax advantages. When you sell your home (or 30 years passes) your agreement with Unison ends. This is when you’ll send us a payment equal to our co-investment, plus (or minus) our portion of the change in your home’s value. Read on for some examples to see how this works. 4 | 1.800.330.9400 | Speak to a Unison Program Specialist Unison HomeOwner vs. Other Options You already know there are a lot of financing options out there. And you also probably know many of them aren’t that great for homeowners. We noticed that too, which is why we created HomeOwner. So if you’re wondering how we stack up against more traditional financing, here’s a quick breakdown: US THEM VS. Unison HomeOwner: Home Equity Loans: (for example, home equity lines of credit) With us, there are no interest rates or monthly These provide access to cash, but require monthly payments. In addition, you control the length payments, often over a short ten year term. of the term by deciding when to sell your home, Another downside is that a lot of these have a including the ability to buy us out after five years variable interest rate, which can end up costing (more on this later). This gives you the flexibility to do you a lot more than you budgeted. Not ideal (unless what’s best for your family. you’re the bank). NOTE: There is a maximum term of 30 years We only get a portion of the future change in value. All the home equity you build after we start working Reverse Mortgages: together remains yours; we just convert a portion of With reverse mortgages, your home’s equity it to cash for you. typically decreases over time. That means over a period of time, a reverse mortgage can actually consume 100% of your home equity, leaving you with a big financial loss. On top of that, it’s difficult to qualify due to age and debt restrictions - all situations that are not ideal. Is Unison HomeOwner Right for Me? We know you’re the only one who can ultimately determine what products and solutions are best for you and your finances. But as general guidelines, Unison might be right for you if: 1. You have lived in your home and built up equity, 2. You plan to stay in place for a while (we suggest at least five years, as the benefits of Unison kick in over time) and 3. You need access to cash without an additional monthly financial burden. For example, you can use Unison to fund a remodeling project, consolidate debt or retire more comfortably. Have questions? Reach out. We’re always happy to discuss your unique situation and make sure it’s the right fit for you. 5 | 1.800.330.9400 | Speak to a Unison Program Specialist How Much Money Can I Get? The amount of Unison’s co-investment depends primarily on your home’s value (that’s usually the appraised value) and the Investor Percentage (that’s the percent of the change in value that goes to us). In practice, we typically arrive at a co-investment amount and Investor Percentage like this: BREAKDOWN A YOUR HOME’S VALUE: This is the first consideration when determining how much you’re eligible to receive. Simply put, the more your home is worth, the more cash we’re able to provide. The less it’s worth, the less we can provide. B + C THE PERCENTAGE OF YOUR HOME’S VALUE + CO-INVESTMENT We can provide a co-investment to you for up to 17.5% of your home’s value today. So if your house is worth $500,000 we can, for example, multiply that by 10% to arrive at a co- investment of $50,000 if that’s what you need. Which leads to… D INVESTOR PERCENTAGE: This is what determines how much of your home’s change in value is paid to us later, and it is tied to how much money you receive. In a typical HomeOwner deal, the Investor Percentage is calculated by multiplying the percentage of your home’s value you are receiving today by four. So if you receive 10% of your home’s value today, the Investor Percentage is likely going to be 40%.