Application process

Application process

Accessing your home equity has never been more fair and flexible. In just a few minutes, you can apply for a Fraction Mortgage and receive an estimate for how much equity you could access from your property*.

If this is your first time applying for a Fraction Mortgage, here’s everything you need to know about our application process.

What is a Fraction Mortgage?

A Fraction Mortgage is a first-lien home equity line of credit that allows you to turn a portion of your home equity into tax-free cash. Unlike existing financial products, such as home equity loans and second-lien HELOCs, a Fraction Mortgage does not require you to make any monthly payments*.

You can use your Fraction Mortgage funds for just about anything — buying another property, home renovations, retirement income, or any large expense. With no required monthly payments*, you only have to pay your balance at the end of your 5 year term.

After the 5 year mark, you can continue working with Fraction by refinancing for another term (subject to an appraisal and 1% refinancing fee).*

What makes Fraction unique?

At Fraction, we believe that all Americans deserve financial products that allow them to live and age well. That’s why we created the Fraction Mortgage to be the fairest and most flexible way to access your home equity.

In addition to no required monthly payments*, Fraction charges interest in a way that protects your equity against movements in the housing market. Since the Fraction Interest Rate is based on the appreciation of your property, your interest rate will automatically adjust based on how the housing market shifts.

No matter your income, credit score, or property, everyone qualifies for our lowest rate if approved for a Fraction Mortgage. See our latest rates here.

How are interest rates calculated? (Non-Washington properties)

If your property is located in Washington State, please navigate to the next section.

The interest rate on your Fraction Mortgage is based on the appreciation of your property. This interest rate and amount you pay back is determined monthly and can be viewed in the Fraction Dashboard at any time. This amount will be based on the average appreciation of your zip code expressed in the Zillow Home Value Index (ZHVI).

If your appreciation rate falls below our minimum rate, you will receive our minimum rate.

If your appreciation rate exceeds our maximum rate, you will receive our maximum rate.

If your appreciation rate falls anywhere between our minimum or maximum rate, your interest rate will match your appreciation rate.

See our latest rates here.

How are Fraction’s interest rates calculated in Washington State?
In Washington State, all mortgage interest rates are calculated with a simple interest rate rather than a compound interest rate. Simple interest rates accrue against the principal (the amount borrowed) while compounding interest rates accrue against both the principal and interest.

For this reason, simple interest accrues at a slower rate. To make up for the difference, simple interest rates tend to be slightly higher.

Due to the unique nature of our rates, your personalized simple interest rate is determined at the end of your term (or when you pay back the loan) based on the average appreciation of your zip code expressed in the Zillow Home Value Index (ZHVI).

If your appreciation rate falls below our minimum appreciation rate, you will receive our minimum simple interest rate.

If your appreciation rate exceeds our maximum appreciation rate, you will receive our maximum simple interest rate.

If your appreciation rate falls anywhere between our minimum or maximum appreciation rates, you will receive a simple interest rate that corresponds to your level of appreciation.

See our latest rates here.

Qualifying for a Fraction Mortgage

In order to qualify for a Fraction Mortgage, you must:

• Own a property located in the US

• Have at least 56% of the property paid off

When you submit your application, we will consider the following:

• The type of property

• The appraised value

• The condition and location of your property

• Your credit score

We will also consider your income, savings, investments, and other non-traditional income sources to ensure you have the means to cover property taxes, insurance, and other ownership expenses.

We welcome applicants with self-employed or irregular incomes to apply.

How do I know if my property qualifies for a Fraction Mortgage?
There are many variables that can influence whether your property would qualify for a Fraction Mortgage. The property can be your primary residence, a secondary residence, or even an investment property.

The easiest way to determine if your property qualifies for a Fraction Mortgage is to input your address in our online application.

Before you apply

During the application, you and your co-applicants will be asked to provide information about your current financial status. 

Please have the following information ready before you apply:

Property information (property type, address, estimated value, mortgage balance)

• Income sources (employer, job title, annual income)

• Outstanding debts (creditor, debt type, debt balance, payment amount and frequency)

• Bankruptcy status

• Other owned properties (property type, address, estimated value, mortgage balance)

• Recommended: During the online application, you will be asked to provide your Social Security number to help us verify your identity and borrowing history. This soft pull on your credit history will not affect your credit score. However, to confirm your funding later in the process, we will do a hard pull on your credit.

Ways to apply

In just a few minutes, you can apply for a Fraction Mortgage and learn how much equity you can access from your property*.

Apply online
Our self-service online application is the easiest and fastest way to apply for a Fraction Mortgage. You can start your application at any time by visiting our online application.

We encourage you to contact us if you have any questions whilst completing the online application.

Apply through a broker
If you prefer, you can speak with your mortgage broker about applying for a Fraction Mortgage. If your broker hasn’t worked with Fraction in the past, you can share information about the Fraction Broker Partner program to get them up to speed.

Getting approved

Once you submit an application, our team will review your submission to confirm whether you and your property meet our qualifying requirements. We will also provide an initial estimate of the maximum mortgage loan amount available to you.

Read on to our next section to learn about what happens once your application has been approved.

Other modules

Ready to tap into your home equity?

Applying for a Fraction Mortgage is free and fast. We’re talking 5 minutes, with no impact on your credit score.