Understanding the Loan

 What to expect throughout the process with this innovative and unique mortgage

How much money can I get?

Generally, you can access funds up to 16% of your home’s appraised value ; and, the maximum combined mortgage liens you have cannot exceed 65% of your home ‘s appraised value.  The minimum amount that can be borrowed is $85,000 and the maximum that can be borrowed is capped at $500,000. 

The actual amount you can borrow will be based on how much you choose to receive at the time you apply (subject to your appraised home value and financial assessment) – at the time of application you can decide how much or how little you’d like to tap into within that range. 

Choosing to receive less money now will result in a lower cost of Shared Appreciation.

Indexed Shared Appreciation = (Indexed Value – Initial Agreed Value) *
(Home Appreciation Interest Share)

the result of that is then multiplied by the following:

(Outstanding Balance/Original Principal Balance)

How do you determine the future appreciation or change in value of the home?

When you apply for EquityChoice, we use an independent 3rd party appraiser to estimate the value of the home (referred to as Appraised Value). To account for market volatility and naturally occurring appraisal variance, the Appraised Value will be reduced by generally 5% to establish the home’s Initial Agreed Value which will be used as the starting point for calculating the future appreciation.

In order to determine the amount of appreciation you will owe at time of payment (partial prepayment or a Maturity Event), we look to the Index to calculate what we refer to as Indexed Shared Appreciation.

Specifically, to calculate the Indexed Shared Appreciation we will:

  • refer to the current Index value published for your Note Date at time of payment, which is the Initial Index
  • compare the Initial Index to the most recently published Index value prior to payment date. This determines the Index Change Percentage
  • multiply the Index Change Percentage by the Appraised Value, the result of which when added to the Appraised Value, is the Indexed Value of your home
  • subtract the Initial Agreed Value from the Indexed Value, then multiply that by your HAIS. That result is finally multiplied by the outstanding principal balance at the time of payment divided by the original principal balance to reach the Indexed Shared Appreciation amount.
Ashton GOak Ridge - TN

The process was smooth from beginning to end and Connor was always available for any questions I had.

Nicholas SPrinceton - NJ

All the Newfi team was quick to respond and always were available and were in touch during the entire refinance process. They also moved things along quickly.

Shane SOcala - FL

Patrick was there every step of they way, and answered every question I had. He was very friendly and patient, he made sure I understood the entire process. I would highly recommend using newfi lending!

Austin DRidgecrest - CA

Mark is very friendly and personable. He was knowledgeable and answered all of our questions quickly. If there were issues with any interfacing companies or organizations, he was quick to call and sort them out. We couldn't have asked for a better le ding experience.

Austin DRidgecrest - CA

Mark is very friendly and personable. He was knowledgeable and answered all of our questions quickly. If there were issues with any interfacing companies or organizations, he was quick to call and sort them out. We couldn't have asked for a better le ding experience.

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