Key Takeaways
- Point receives a credit score starting at 500. Unlocking receives a score starting at 500 for single-family homes and townhomes used as a primary residence; the minimum is 550 for condo, two-to-four-unit property, investment and second homes. Other providers have higher requirements; for example, Unison list 620.
- HEI approval is usually based more on your home’s equity, value, and location than your credit score.
- Poor credit can still affect your offer, as the HEI company may respond by offering less cash or require a larger portion of the home’s value in the future.
Check your home equity options. Start here
Yes, you may qualify for a home equity investment (HEI) with a low credit score. Some HEI companies accept scores up to 500, while home equity loans and HELOCs typically start at 620 or higher. Meeting the minimum credit score does not guarantee approval; property, equity and other underwriting requirements apply.
HEI can take a lower score because the company does not calculate the monthly payment. The company pays you cash now in exchange for a portion of your home’s home value, so the approval depends more on your equity and property than your credit. Poor credit can still cost you, either through a smaller cash offer or a larger portion of your home’s value.
What is Home Equity Investment (HEI)?
Home equity investing is a cash-for-equity swap. You get a lump sum, and in return, the investment company gets a portion of your home’s home value.
That’s what makes HEIs so different from loans. These agreements generally do not have a fixed interest rate or monthly payment for HEI providers, but they are not free. Settlement is calculated under the contract using the home’s value or changes in value, and may include fees. Payments are usually due at the end of the term or on a trigger event such as a sale. Refinancing can help settle the funds, according to the terms of the lender and the contract. You remain responsible for the mortgage and ongoing housing costs.
At the end of the agreement (usually 10 to 30 years), you can sell the house, refinance, or buy the investor out.
What the experts say
Michael Gifford, CEO of Splitero
“Most homeowners want three things: easy qualification, no monthly payments, and clarity about what they’re leaving – and that’s where HEI really makes a difference.”
For a deeper dive, explore what a home equity agreement is.
Verify your loan eligibility. Start here
Can you get HEI with cheap credit?
Yes, in many cases you can get an HEI with very little credit. This is one of the biggest reasons IPT is a product category. The HEI company knows there is a large group of homeowners who are “equity-rich but credit-challenged.” They may have built equity over the years, but have been unable to obtain traditional financing due to late payments, collections, or high debt.
Because the HEI is not based on your ability to make monthly payments, some providers accept a score that would be an automatic rejection for a HELOC or home equity loan. See how HEIs compare to HELOCs in terms of cost and eligibility.
What credit score do you need for HEI?
Most HEIs do not publish a single “hard minimum” credit score, but many fall within a general range.
The minimum is generally between 500 and 620, depending on the company. Point, for example, requires a score of at least 500, while other providers set higher floors. Compare the minimums, fees and requirements among the best home equity investment companies before you apply.
To put that in perspective, here’s how HEIs compare to more traditional home equity products:
| product | A typical minimum credit score |
|---|---|
| Home equity investment (HEI) | 500 to 620 (varies by company) |
| Home equity loans | Often 620 or more; varies by lender |
| HELLO | Often 620 or more; varies by lender |
| Cash-out refinance | Varies by lender (often 620 or more) |
This is why HEIs are often seen as a viable option when someone is looking for “home equity with bad credit.”
Verify your HELOC eligibility. Start here
Why HEI companies can approve lower credit scores
Traditional lenders approve you primarily on your ability to repay. The HEI company approves you mainly on your home, because it gets the money back when the home is sold or the agreement is over.
Although HEI providers still check your credit, they usually focus more on the underlying property. The risk is associated with the value of the home and the ability to recover the investment when the agreement is completed.
Likewise, HEI companies often care more about:
- how much equity do you have
- where is his house?
- how stable is the local market
- whether the property is easy to appraise and sell
In other words, HEI is not a “no-credit-check” product. But it’s usually cheaper than a loan.
If credit is not the main approval factor for HEIs, what else can be rejected?
Getting a cheap loan does not make the agreement easy. HEI providers still have strict guidelines; they focus on your business and property rather than your score.
Even if your credit is low, you may be denied if:
- you don’t have enough equity
- your property is in a location where companies will not invest
- limited housing types (some condominiums, manufactured homes, etc.)
- Your debt-to-value ratio is too high
- your finances show instability (even without monthly payments)
- you have a recent bankruptcy (Points, for example, a two-year waiting list after discharge or dismissal from Chapter 7 or 11 bankruptcy), and a recent foreclosure may also affect your eligibility
Therefore it is more correct to say: IPT is accessible to borrowers with bad credit, but it is not a universal agreement.
Verify your debt entitlement. Start here
What is a “too low” credit score for HEI?
HEI may be available at lower scores, but there is still a practical floor. In most cases:
- the score mid-500s can still escape
- score around 500 may have a strong property profile
- score is also lower 500 it often becomes difficult
If your score is too low, providers may assume there are unresolved credit issues. Even if they don’t collect monthly payments, they still want confidence that homeowners can maintain their property and keep their taxes and insurance current.
Time to make a move? Let’s find the mortgage that’s right for you
Does cheap credit affect HEI requirements?
Yes, even if you qualify, low credit can affect your HEI offer. With a loan, the lender usually takes the risk by charging a higher interest rate. With HEIs, companies often risk differently. Instead of raising rates, it could:
- offer less cash
- require a larger portion of the future home value
- a more conservative value application
So the real question is not just “Can I get approved?” It’s also: “Is the deal still worth it if I look at the terms?”
Why HEIs can be a lifeline (and tradeoff) for low-credit homeowners
For homeowners with poor credit, an HEI can be one of the remaining ways to tap home equity, especially after a HELOC or home equity loan rejection.
But accessibility doesn’t mean free money. The tradeoff is that you give up a portion of your home’s home appreciation. If the value of your home increases significantly, your loan amount may be higher than what you received upfront.
In a January 2025 report, the Consumer Financial Protection Bureau warned that the single payment due at the end of a home equity contract can be difficult to predict, could run into the hundreds of thousands of dollars and could force some homeowners to sell. Before you go in, estimate the true cost of your home equity investment.
That doesn’t automatically make HEI bad. It just means they work best if you know what you’re trading: cash now, to share upside later.
What the experts say
Thomas Brock, CFA, CPA
“Homeowners with bad credit can be so focused on whether they’ll qualify for HEI that they ignore the more important question – are they really giving up? HEI can feel like a financial lifeline, especially if you’ve been denied funding elsewhere.
However, once you know how much equity you want to give investors in exchange for cash, your focus should quickly shift from “Can I get away with it?” to “Is this a smart use of equity?” Always remember, a low credit score may make it easier to qualify for an HEI, but it will not make you less diligent in evaluating the economy.
How to increase your chances of getting approved for HEI with low credit
If you’re in the low credit range, you don’t have to “fix” your credit before applying, but you want to avoid red flags that could make your application seem riskier than it needs to be.
A few smart steps can help, especially if you’re on the edge:
- pay off credit card balances to reduce DTI
- address obvious credit report errors
- stable income document
- make sure your property taxes and homeowner’s insurance are current
Although HEI is not a loan, the provider still wants to see that the homeowner is stable and the property is protected.
Bottom line
A low credit score does not automatically prevent you from accessing home equity. Some home equity investment (HEI) companies receive credit scores below 500 because they invest in the value of the home rather than lending based on monthly payments.
Remember that an agreement isn’t just about credit, and even if you qualify, low credit can affect how much cash you’re offered and how much you’ll be willing to share.
Question
Sometimes, yes. Some HEI companies accept a score of at least 500. Completing the minimum credit score does not guarantee approval; property, equity and other underwriting requirements apply. A score close to the company’s minimum may mean a smaller cash offer or a larger portion of its future value.
yes already. Most HEI companies review credit, but often place more weight on home value and equity than traditional lenders.
Often, yes. HELOCs typically require a score of 620 or higher because the borrower makes monthly payments. HEI companies do not collect monthly payments, and many accept lower scores and consider home equity and property values more.
Can. HEI providers may offer you less cash or require a larger portion of the home’s value in the future if they see your profile as a higher risk.
It depends. If your home appreciates significantly, HEI payments can be worth it, as you will be making a profit.
Often, after a period of waiting. Point lists a waiting period of two years after discharge or discharge from a Chapter 7 or 11 bankruptcy, one year after a Chapter 13 discharge, and two years after a Chapter 13 discharge. Multiple bankruptcy filings in the previous seven years carry a five-year waiting period. Other eligibility requirements still apply.
The information contained on The Mortgage Reports website is for informational purposes only and is not an advertisement for products offered by Full Beaker. The views and opinions expressed here are those of the author and do not reflect the policies or positions of Full Beaker, its officers, parents, or affiliates.
By refinancing an existing loan, the total financial costs incurred may be higher over the life of the loan.