Jamie Johnson 
Key takeaways:
- Homeowners can access their equity without selling or refinancing.
- Traditional options like HELOCs and home equity loans come with monthly payments and credit requirements, while alternatives like shared equity agreements offer more flexibility.
- The best strategy for tapping into your home equity depends on your financial goals and timeline.
Home prices have surged in recent years, providing home owners with significant increases in equity. Typically, homeowners take advantage of that appreciation when they sell their homes, but selling a home these days is not high on the list of priorities for American homeowners. Last fall, Unlock surveyed homeowners about whether they thought 2026 would be a good year to sell a home. Sixty-seven percent said no or that they weren’t sure. That’s up from six months earlier, when 60% of homeowners told us they were unsure or didn’t think that 2025 would be a good year to sell a home.
Luckily, there are other ways to tap home equity without selling your home. From traditional options like HELOCs to newer alternatives that don’t involve monthly payments, homeowners have more options than ever. The graph below shows that homeowners are looking beyond just selling to unlock their equity.
In this article, we’ll alternative ways to get equity out of your home so you can choose the option that best fits your financial goals.
Home Equity Loan
A home equity loan involves taking out a lump sum of money at the beginning of the loan term. The interest rate and monthly payment will stay the same throughout the life of the loan, making budgeting easier. The loan terms you qualify for are based on your credit score, loan-to-value (LTV) ratio, and debt-to-income (DTI) ratio.
However, when you take out a home equity loan, you’re using your home as collateral. That means if you’re unable to make your monthly payments, your lender can foreclose on your house.
HELOC
A home equity line of credit is similar to a credit card in that you have a line of credit you can draw from on an as-needed basis. During the draw period, you only have to pay interest on the amount you borrow. As you repay the line of credit, you can access the full amount again. Once the draw period ends, you’ll enter the repayment period, where you’ll begin paying back the HELOC.
The exact criteria for qualifying for a HELOC vary by lender, but most require a credit score of at least 620 and a stable source of income. Most lenders also look for an LTV ratio of 85% and a DTI ratio of 36%.
Cash-out refinance
When you do a cash-out refinance, you’ll take out a new mortgage for more than what you currently owe on your home. Then you pay off your existing mortgage and keep the difference in cash. To qualify, most lenders require a credit score of 620 or higher, a DTI ratio of 43% or less, and a verified source of income.
The paperwork and documentation requirements are similar to when you took out your first mortgage, and you’ll have to pay closing costs on the loan. However, mortgage rates are significantly higher than they were several years ago. So unless you purchased a home very recently, a cash-out refinance may not be the best option for tapping into your equity.
Reverse mortgage
If you’re 62 or older, a reverse mortgage lets you access your home equity without making monthly mortgage payments. Instead, the lender pays you, and the loan balance grows over time as you continue accessing equity. The loan is usually repaid when the home is sold, or the homeowner moves out or passes away.
There are no income requirements, but reverse mortgages come with higher upfront costs than traditional loans, including closing costs, origination fees, and mortgage insurance. Borrowers are also required to complete a HUD-approved counseling session before moving forward.
Shared Equity Agreements
A shared equity agreement, sometimes called a home equity agreement or HEA, allows homeowners to access equity without taking on a loan or making monthly payments. Instead of borrowing money and paying interest, you receive a lump sum of cash in exchange for a portion of your home’s future value.
With a shared equity agreement, you typically settle when you sell your home or at the end of the term, which ranges from 10 to 30 years. Because there are no monthly payments, this option can appeal to homeowners who want to allow for flexibility in their budget.
Qualification requirements are often more less stringent than traditional lending products. Many shared equity agreements don’t require minimum income levels, and credit score requirements may be lower. That can make this option attractive for self-employed homeowners, retirees, or individuals with less-than-perfect credit.
Unlock offers an HEA that gives homeowners control over when and how they settle, without monthly payments. This structure allows homeowners to access cash while continuing to live in and benefit from their home.
Sell and Downsize
Selling your home and downsizing is another way to unlock equity, particularly for homeowners who want to reduce their ongoing housing expenses. By purchasing a less expensive home, you may be able to free up a significant amount of cash from your existing equity.
However, this option comes with trade-offs. Selling a home can be time-consuming and costly, especially when factoring in closing costs, moving expenses, and higher mortgage rates. For many homeowners, limited housing inventory and rising home prices in their area can also make downsizing less appealing.
Conclusion
Home equity is a solid financial resource for many homeowners, even as the housing market continues to evolve. Whether you’re looking to cover unexpected costs or invest in home improvements, there are multiple ways to tap into your equity without selling your home outright.
Traditional options like HELOCs and home equity loans can work well for some homeowners, while alternatives like shared equity agreements may appeal to those who want to avoid monthly payments or strict credit requirements. The right choice depends on your financial goals and timeline. If flexibility and staying in your home are top priorities, exploring non-loan options like Unlock’s HEA may be worth considering.
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Get StartedFAQs
There is no one-size-fits-all answer. The safest option depends on your financial situation, risk tolerance, and ability to manage payments or future obligations. Carefully reviewing terms and understanding how each option works is essential.
The “best” option depends on how you plan to use the funds. A HELOC offers access to an ongoing line of credit, so it may be a better choice if you aren’t sure how much you need to borrow. A home equity loan provides a lump sum and predictable monthly payments, so it could be a better choice for borrowers who know their costs upfront.
There are many ways to access your home equity without refinancing, including HELOCs, home equity loans, reverse mortgages (for eligible homeowners), shared equity agreements, or selling and downsizing. Shared equity agreements allow access to equity without refinancing or monthly payments.
The impact depends on how you access your equity. With loans such as HELOCs, home equity loans, or cash-out refinances, you’re still responsible for repaying the full loan balance even if your home’s value declines, which can increase the risk of owing more than the home is worth.
With shared equity agreements, settlement amounts are typically based on your home’s value at the time of sale or settlement, so the amount owed may rise or fall with the market. Reverse mortgages also offer protections in declining markets, as they are generally non-recourse loans, so borrowers or heirs are not responsible for any balance beyond the home’s value.
