Funds to Homeowner
Homeowner Repays
Homeowner Keeps
Annual Cost
Funds Today
Equity Sharing Terms
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*At settlement, the Annual Cost will never exceed the federal maximum annual rate in Canada. This limit could only apply to an exit within the first 2 years after strong growth in home value.
How It Works
- No monthly payments or interest: The homeowner receives the Initial Payment as a lump sum today. HEQ is repaid only at exit, when the homeowner sells the home, completes a Homeowner Buyout, or reaches the end of the term.
- Flexible exit: The HESA term is up to 10 years. The homeowner can exit at any time by selling the home or completing a Homeowner Buyout, with no prepayment penalty.
- What the homeowner repays: At exit, the homeowner repays the Initial Payment plus HEQ’s share of any increase in the home’s value above the Starting Agreed Value, or less HEQ’s share of any decrease below it.
- HEQ Percentage: The HEQ Percentage is 4x the Investment Percentage if the home’s value rises above the Starting Agreed Value, and 1x if it falls below it. For example, a $100,000 Initial Payment on a $1,000,000 home is a 10.0% Investment Percentage. HEQ receives 40.0% of any increase and shares 10.0% of any decrease, except as noted under the Homeowner Buyout and Restriction Period rule below.
- How the change in value is measured: From the Starting Agreed Value (the Appraised Home Value less a 5.0% Risk Adjustment) to the Ending Agreed Value (the sale price, or a new appraisal for a Homeowner Buyout).
- Homeowner Buyout and Restriction Period rule: For a Homeowner Buyout, or a sale within the first 3 years (Restriction Period), the Ending Agreed Value cannot be lower than the Appraised Home Value.
- Renovations and upkeep: This calculator does not account for Renovation or Maintenance Adjustments. At exit, value added by permitted renovations costing more than $25,000 is excluded in favour of the homeowner, and value lost to poor upkeep is added back in favour of HEQ. Final adjustment amounts are determined by an independent appraisal or inspection.
- Eligible homes: The HESA is available to homeowners in the Greater Toronto Area who own and live in a detached home, semi-detached home, or townhome. Condos are not eligible at this time.
- HESA limits: The homeowner needs at least 30.0% existing home equity to qualify, and the Existing Mortgage & Secured Debt (including the full limit of any HELOC) plus the Initial Payment cannot exceed 75.0% of the Appraised Home Value. The Initial Payment ranges from $50,000 to $500,000, and from 5.0% to 17.5% of the Appraised Home Value.
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Estimates are illustrative and provided for discussion purposes only, and do not constitute an offer or a commitment to enter into a Home Equity Sharing Agreement. To secure the obligations of the homeowner under the Home Equity Sharing Agreement (HESA), HEQ registers a mortgage against title to the Property. Notwithstanding the registration of a mortgage against the Property, HEQ is not a licensed mortgage broker and does not offer, arrange, or administer mortgages, or participate in mortgage brokering activity, and HESAs do not constitute a mortgage. HEQ works with and arranges HESAs and the related transactions through licensed mortgage brokers.
This website and its content are provided for general informational purposes only and do not constitute financial, legal, tax, mortgage, or investment advice. Before entering into a Home Equity Sharing Agreement, homeowners are required to discuss their options with their own licensed mortgage broker and obtain independent legal representation. All HESA transactions are subject to eligibility requirements in HEQ’s sole and absolute discretion, independent property appraisal, third-party underwriting, and applicable Ontario laws and regulations.