sponsoring legislation<\/a> to regulate the firm and its products.<\/p>\nState Rep. Tim Twardzik (R., Schuylkill), a co-sponsor of the proposal, added in his own comments Wednesday that the offer was \u201cpay to play.\u201d<\/p>\n
Pennsylvania has lax ethics laws overall. And the appearance of paid, professional lobbyists before lawmakers is a constitutionally protected and normal part of the legislative process at all levels of government.<\/p>\n
But lobbyists, Venkat noted, must disclose who pays them. And Point is not yet registered to lobby the General Assembly, according to state records. The customers, whose testimony was included within a packet of meeting materials, only present themselves as citizens and homeowners and do not reference the payments.<\/p>\n
Venkat strongly criticized the tactic.<\/p>\n
\u201cThe only way that the industry seems to be able to get people to say something nice about it is to offer a financial inducement, and they conveniently have decided not to reveal that to my colleagues and me \u2014 who have the responsibility to weigh in a deliberative fashion testimony before us,\u201d Venkat added. \u201cSo it calls into question their credibility, and it really raises questions about the product.\u201d<\/p>\n
Matthew Windsor, deputy general counsel for Point, confirmed the email Wednesday morning when asked about the gift card deal in the hearing of the state House Commerce Committee.<\/p>\n
He said the payments were a means of quickly collecting testimony for the hearing, adding that “we did not screen anything.\u201d<\/p>\n
Point\u2019s business model is to provide homeowners in need of cash with a lump sum payment using their house as collateral.<\/p>\n
But rather than paying the loan back gradually, the homeowner remunerates the lender in another lump sum \u2014 calculated based on a number of factors \u2014 when they sell their home or if the homeowner decides to end the contract. These payments can end up being higher than the initial loan.<\/p>\n
Point sent the gift card offer in a Feb. 24 email with the subject line \u201cLast chance: share your story to protect HEI access.\u201d<\/p>\n
\u201cRegulatory action in Pennsylvania could impact our ability to fund Home Equity Investments (HEIs) in your state,\u201d Point\u2019s email said. \u201cYou can help protect HEIs by submitting a written testimonial. Below is a template \u2014 just personalize it with your experience and send.\u201d<\/p>\n
Among the prompts were: \u201cI was looking for funds to: [Insert your financial goal]\u201d; \u201cOther options weren\u2019t a good fit for me because: [Explain why traditional loans, credit cards, or other solutions didn\u2019t work]\u201d; and \u201cMy HEI has given me: [Share how having access to HEI funds has helped you achieve your goals or improved your situation].\u201d<\/p>\n
If submitted, the sender would receive a $50 Amazon gift card \u201cas a thank-you for your time and support.\u201d<\/p>\n
All told, 23 citizen emails opposing Venkat\u2019s bill were included in a committee testimony packet viewed by Spotlight PA. They include stories of individuals using equity investments to pay for home repairs, college tuition, property taxes, and credit card debt; 10 directly quote Point\u2019s prompts.<\/p>\n
State Rep. John Lawrence (R., Chester), an eight term legislator who serves as the committee\u2019s ranking Republican, added that he wasn\u2019t aware of anyone paying for testimony to support their cause before a committee.<\/p>\n
On the underlying issue, he thought that the bill needed more work, including input from regulators in the state\u2019s banking department and attorney general\u2019s office.<\/p>\n
But on the gift cards, he quipped: \u201cI wouldn’t have wanted to sit on the other side of the table to try to explain that away.\u201d<\/p>\n
Costs are unknown by design<\/p>\n
On the company\u2019s website, Point says its products allow homeowners to \u201cunlock your home equity with no monthly payments, no income requirements, and no need for perfect credit.\u201d<\/p>\n
Unlike a mortgage, in which the total value is known up-front thanks to its fixed interest rate over a fixed time period, the amount a homeowner pays back to Point after they get their initial lump sum is unknown.<\/p>\n
A sample contract from the industry\u2019s trade group that was included in their legislative testimony stipulated that the return for one of these lending firms would be a higher percentage of the home sale value than it initially paid to the homeowner. On top of that, the return is designed to shift based on how the home\u2019s value changes.<\/p>\n
Combined with fees baked into the contract, the homeowner\u2019s closing payment can end up being higher than the initial loan, even if the home\u2019s value decreases. And if a recipient fails to pay back what they owe in full, the firm can foreclose.<\/p>\n
Point and the trade organization representing similar lenders argue they provide flexibility to homeowners who want to access their home equity for cash without adding additional monthly payments.<\/p>\n
\u201cI’m sure they sound like new concepts to you,\u201d said Jim Riccitelli, CEO of Unlock Technologies, another lender. But \u201cthere’s nothing inherently wrong with those things. Those are simply \u2026 how we generate return. That’s how we price the contract, in the same way that there’s nothing wrong with the interest rate on a loan.\u201d<\/p>\n
While You\u2019re Here<\/p>\n
Spotlight PA\u2019s nonprofit reporting is a free public service, but it depends on your support. Give now to ensure it can continue.<\/p>\n
However, federal and state regulators have questioned if consumers are aware of the risks that come with this product.<\/p>\n
A 2025 report<\/a> from the Consumer Financial Protection Bureau that reviewed complaints against the industry found homeowners \u201cfelt frustrated or even misled about various aspects of home equity contracts\u2014including confusion about the financing terms, surprise at the size of the repayment amounts, disputes about appraisal values, difficulty with refinancing due to the existence of the home equity contract, and frustration that they felt their only option to get out of the contract was to sell their home.\u201d<\/p>\nIn 2020, Pennsylvania regulators ruled the product falls outside the state consumer protection law covering lending, according to a letter the industry shared with legislators. As introduced, Venkat\u2019s bill would place the industry under this existing law, which sets maximum interest rates, transparency requirements, and penalties for breaking any requirements.<\/p>\n
Industry members told lawmakers such regulations would effectively ban their product from Pennsylvania, and argued for a chance to design different rules. Venkat told Spotlight PA that a ban isn\u2019t his intent, and that he thinks their claim is overstated.<\/p>\n
\u201cThe question that I would ask the coalition is \u2014 \u2018Have you stopped selling these products in those states [with stricter laws]?\u2019\u201d he said. \u201cAnd the answer to that, as far as I know, is no.\u201d<\/p>\n
As for working with the industry to develop state rules more to its liking, Venkat said its tactics haven\u2019t won any favors.<\/p>\n
\u201cTheir efforts on this legislation makes me very skeptical of their motivations in terms of coming to an agreement that would be to the benefit of Pennsylvanians,\u201d he said.<\/p>\n
Correction: An earlier version of this story misattributed a quote from a testifier in the Pa. House hearing on home equity-backed loans. It was said by Jim Riccitelli, CEO of the lender Unlock Technologies.<\/p>\n","protected":false},"excerpt":{"rendered":"HARRISBURG \u2014 A home financing firm offered its customers Amazon gift cards if they submitted testimony to a…\n","protected":false},"author":2,"featured_media":130383,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[28,30,29],"class_list":{"0":"post-130382","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-pennsylvania","8":"tag-pennsylvania","9":"tag-pennsylvania-headlines","10":"tag-pennsylvania-news"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/posts\/130382","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/comments?post=130382"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/posts\/130382\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/media\/130383"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/media?parent=130382"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/categories?post=130382"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/tags?post=130382"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}