Hometap, which operates in 16 states and Washington, D.C., countered these claims by saying it “firmly believes within the integrity of our merchandise and the monetary flexibility they supply to Massachusetts owners.” However because the lawsuit continues to play out, Massachusetts is not listed among the many states the corporate does enterprise in.
The swimsuit in Massachusetts is comparable in nature to a case filed in Washington state in opposition to fellow HEI supplier Unison. An appellate court docket lately ruled in favor of the plaintiffs and decided that Unison’s product was a reverse mortgage underneath state legislation. Unison initially sought to attraction that call however settled with the plaintiffs shortly thereafter.
On Nov. 3, Hometap and the state Legal professional Common’s Workplace (AGO) launched a number of court docket filings by which the plaintiffs sought to “strike inadequate defenses” from the lawsuit, whereas the defendants tried to maintain them in place.
Among the many authorized arguments addressed within the filings, Hometap labels the lawsuit as an “about-face.” The corporate claims that neither the AGO’s workplace nor the Massachusetts Division of Banks (DOB) expressed considerations in regards to the firm’s HEI product going again to 2018, after they had been first launched within the state. The corporate additionally stated that the state financial institution regulator has acknowledged that HEI merchandise differ in lots of facets from mortgage loans.
Moreover, Hometap notes that companion payments had been launched by Massachusetts lawmakers in early 2025 that search to position HEI suppliers underneath the DOB’s purview. H. 1106 and S. 705 would specify that HEIs are usually not loans and set forth obligations to make sure they don’t seem to be misleading or unfair.
The corporate stated it’s already abiding by these obligations and that the HEI trade helped to develop the payments as a part of its need to be extra intently regulated.
“Nearly a month after this legislative course of was initiated, the Commonwealth selected to short-circuit (and contravene) it by submitting this motion in a whole course reversal of its early interactions with Hometap,” the corporate’s submitting states.
In response, the state argues that its early interactions with Hometap don’t equate to an endorsement of its product.
It notes that the AGO’s workplace is allowed to take conferences with the general public “without having to predetermine whether or not it is able to commit the sources crucial to succeed in a agency authorized place a couple of purportedly novel product or instantly prioritize an investigation and enforcement motion.”
It goes on to say that forcing the AGO to take action would make it much less accessible to the general public, since it will be positioned able to make “snap-judgments of legislation based mostly on restricted info.” The AGO argues that requiring additional discovery into whether or not its enforcement actions are affordable can be overly burdensome and must be stricken from the lawsuit.
