Home equity-sharing firm Unison is said to pick banks for US IPO

Unison, which provides cash in exchange for a share of a home’s future value, has picked banks to lead an initial public offering, according to people familiar with the matter.

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The company selected banks including UBS Group AG and Cantor Fitzgerald for the offering and seeks to raise as much as $500 million, said the people, who asked not to be identified because discussions are private. 

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A listing could come as soon as November, one of the people said. Deliberations are ongoing and details of the proposed IPO including the banks could change, the people said. 

Representatives for UBS and Cantor Fitzgerald declined to comment. Unison did not provide an immediate comment.

Investors and bankers have been grappling with a choppy market for IPOs in recent weeks, with some firms formally postponing listing plans. 

Still, Unison is preparing to test the public market as elevated mortgage rates are driving consumer demand for a product the company pioneered two decades ago. In an equity-sharing agreement, Unison gives a homeowner cash in return for a share of their home’s future price appreciation.

Rather than making monthly payments, consumers write one check to Unison when they sell or refinance their home. The agreements appeal to homeowners who can’t qualify for a traditional home-equity loan, or don’t want to add to monthly interest payments from mortgages, credit cards or car loans. 

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US households are sitting on a record $35.8 trillion in home equity, according to the US Federal Reserve. At the same time, higher mortgage rates have made it increasingly difficult to sell, or to pull money out through a traditional home equity loan. 

Unison and its competitors have originated more than $2.6 billion in financings this year through Sept. 30, up about 30% from the same period last year, according to data from SFR Analytics. 

Critics warn that the products can be difficult for consumers to understand, and in some cases, punishingly expensive. 

Unison was founded in the early 2000s by Thomas Sponholtz, who was looking for a way to give institutional investors exposure to US home price appreciation. 

Demand didn’t grow meaningfully until after the US foreclosure crisis, when competitors such as Point, Hometap and Splitero entered the market. In 2024, Unison entered into a strategic partnership with Carlyle Group Inc., which agreed to buy as much as $300 million of equity-sharing home loans.