To REX or not to REX? It's your home Equity

Mortgage and Lending with HOPE Lending LLC

Recently Komo 4 published a story called A new way to get equity out of your home.  Yeah...someone is trying to help us in this bear market (probably not).  A REX Agreement (sounds like wrecks) is an equity investment company in San Francisco.  They provide immediate cash with no loan, no interest and no monthly payments. 

To qualify for the REX AGREEMENT, you must have a stand-alone home that you live in. Second homes, condos and vacation property are not eligible.  You must also have a decent credit score and be financially responsible.  Other things to consider are:

  • The equity you take out determines the percentage of future equity you'll give up.

  • You can ask for a percentage of your equity or for a specific dollar amount, and there can be room for negotiation.

  • You can do an early buy-back, in which value change is determined by the appraised value of your home at the time you want to pay back the equity.

  • The goal is for a long-term contract and there could be an exit fee if you get out before five years ranging from 5% to 25%!

  • You may also face extra fees if you do not deal directly with REX and Co. However, financial advisers, mortgage brokers, and real estate agents licensed by Rex to sell the product can charge fees up to $2,000.  
  • Maybe this product would be useful if you are bearish on housing and disciplined with investing and represents a sort of hedge against falling home values.  However, the REX Agreement is only offered in selected markets where real estate values are stable. The company analyzes the markets and does a lot of homework before deciding which states are likely to have the best investment potential and consumers should do the same thing.  Of course, they are in the business to make money and not likely to enter an agreement if a LOSS is possible. 

    Why would anyone want to tap into their equity this way if they could qualify for a more traditional, less risky, bank loan with a net lower return of payment?  Let's consider this by looking at the numbers.

    REX Agreement

    DOWNLOAD REX LOAN TEST NOW (fill in yellow boxes - the rest will automatically compute)

    This product does not seem to benefit anyone except the investor lending to you.  For alternative options with your best interest first, please contact Melissa Olson at HOPE Lending LLC.


    Comments (2)

    Jo Olson
    HOMEFRONT Realty - Kettle Falls, WA
    Retired - HOMEFRONT Realty @ LAKE Roosevelt
    Melissa, This is really great info. I have been hearing this information on the radio and I just wasn't getting what it was. I hadn't had time to research. Thanks so much for giving the real scoop! I am flagging this for a feature!!
    Mar 10, 2008 05:22 PM
    Melissa Olson
    HOPE Lending LLC - Bellevue, WA
    HOPE Lending LLC
    Jo - I'm glad this was helpful for you!
    Mar 11, 2008 06:17 AM