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Key Takeaways
- Many HEI companies accept credit scores as low as 500–550, making HEIs one of the most accessible ways to tap home equity with poor credit.
- HEI approval is usually based more on your home’s equity, value, and location than your credit score alone.
- Low credit can still affect your offer, because HEI companies may respond by offering less cash or requiring a larger share of future home value.
Check your home equity options. Start here
If your credit score is low, you’ve probably already discovered the frustrating truth about home equity: the fact that you own a home doesn’t automatically mean lenders will let you borrow against it.
Most home equity loans and HELOCs still have fairly strict credit requirements, and if your score is under 620, your options can narrow quickly. That’s why so many homeowners with poor or fair credit end up searching for alternatives, especially if they have real equity built up.
Home equity investments (HEIs) are one of the most common alternatives, and they exist for a simple reason: they’re not loans. That difference is also why HEIs can sometimes approve borrowers with credit scores as low as 500–550.
What Is a Home Equity Investment (HEI)?
A home equity investment is a cash-for-equity swap. You get a lump sum today, and in return, an investment company gets a share of your home’s future value.
That’s the part that makes HEIs feel so different from a loan. There’s no interest rate and no monthly payment because you aren’t borrowing money. You’re essentially selling a slice of future value.
At the end of the agreement (typically 10 to 30 years) you settle up by selling the home, refinancing, or buying the investor out.
What experts are saying
Michael Gifford, CEO of Splitero
“Most homeowners want three things: easy qualification, no monthly payment, and clarity on what they’re giving up — and that’s where an HEI really stands apart.”
Verify your loan eligibility. Start here
Can you get an HEI with low credit?
Yes, in many cases you can.
This is one of the biggest reasons HEIs exist as a product category. HEI companies know there’s a large group of homeowners who are “equity-rich but credit-challenged.” They may have built equity over years of ownership, but they can’t qualify for traditional financing due to past late payments, collections, or high revolving debt.
Because an HEI isn’t based on your ability to make monthly payments, some providers accept scores that would be automatic rejections for a HELOC or home equity loan.
What credit score do you need for an HEI?
Most HEI companies don’t publish one single “hard minimum” credit score, but many fall into a general range.
In practice, you’ll often see approvals in the 500–620 zone, depending on the provider. Some accept borrowers in the 500–550 range, while others prefer a score closer to 600+.
To put that in perspective, here’s how HEIs compare to more traditional home equity products:
| Product | Typical Minimum Credit Score |
| Home Equity Investment (HEI) | 500–620 (varies by company) |
| Home Equity Loan | 620–680 |
| HELOC | 620–700 |
| Cash-Out Refinance | 620–680 |
This is why HEIs often show up as a viable option when someone searches “home equity with bad credit.”
Verify your HELOC eligibility. Start here
Why HEI companies can approve lower credit scores
The simplest way to think about it is this:
Traditional lenders are betting on you. HEI companies are betting on your home.
Even though HEI providers still review your credit, they’re usually more focused on the underlying property. Their risk is tied to the home’s value and their ability to recover their investment when the agreement ends.
That’s also why HEI companies often care more about:
In other words, HEIs are not “no-credit-check” products. But they’re typically far less credit-driven than loans.
If credit isn’t the main approval factor, what can still get you denied?
This is the part that surprises homeowners.
Many people assume that if HEIs accept low credit, approval must be easy. But HEI providers still have strict guidelines – they’re just focused on different factors.
Even with low credit, you may be denied if:
This is why it’s more accurate to say: HEIs are accessible for low credit borrowers, but they’re not universal approvals.
Verify your borrowing eligibility. Start here
What credit score is “too low” for an HEI?
HEIs can be available at lower scores, but there’s still a practical floor.
In many cases:
If your score is extremely low, providers may assume there are serious unresolved credit issues. Even though they aren’t collecting monthly payments, they still want confidence that the homeowner can maintain the property and keep taxes and insurance current.
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Does low credit affect HEI terms?
Yes, and this is one of the most important points in this entire article.
Even if you qualify, low credit can affect your offer. With a loan, lenders usually price risk by charging a higher interest rate.
With an HEI, companies often price risk differently.
Instead of raising a rate, they may:
So the real question isn’t just “Can I get approved?” It’s also: “Will the deal still be worth it once I see the terms?”
Why HEIs can be a lifeline (and a tradeoff) for low credit homeowners
If your credit score is low, you may already feel like every financial product is locked behind a gate you can’t get through. That’s what makes HEIs feel so appealing: they’re one of the few home equity options that can still be available.
But accessibility doesn’t mean free money.
The tradeoff is that you’re giving up a portion of your home’s future appreciation. If your home value rises significantly, the amount you owe at settlement could be far higher than what you received upfront.
That doesn’t automatically make HEIs bad. It just means they work best when you understand what you’re trading:
- cash now
- for shared upside later
How to improve your odds of getting approved with low credit
If you’re in the low credit range, you don’t necessarily need to “fix” your credit before applying, but you do want to avoid red flags that can make your application look riskier than it needs to.
A few smart steps can help, especially if you’re right on the edge:
Even though HEIs aren’t loans, providers still want to see that the homeowner is stable and the property is protected.
The bottom line
A low credit score doesn’t automatically block you from accessing home equity. Many home equity investment (HEI) companies accept credit scores as low as 500–550 because they’re investing in your home’s value rather than lending based on monthly repayment.
Just remember that approval isn’t only about credit, and even if you qualify, low credit can affect how much cash you’re offered and how much future value you’ll share.
FAQs: HEIs and low credit
Sometimes, yes. Some HEI providers accept scores around 500–550, but approval depends heavily on your home’s equity and property profile.
Yes. Most HEI companies review credit, but they often place more weight on the home’s value and equity than traditional lenders do.
Often, yes. HELOCs typically require higher credit scores because they are revolving debt products with monthly repayment risk.
It can. HEI providers may offer less cash or require a larger share of future home value if they view your profile as higher risk.
It depends. If your home appreciates significantly, the HEI payoff can be expensive, since you’ll share in the upside.
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 herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent, or affiliates.
By refinancing an existing loan, the total finance charges incurred may be higher over the life of the loan.
