A year that started out promisingly for shared home appreciation platform Easyknock is ending with the company abruptly going out of business.
"After many years of serving consumers, Easyknock has closed its doors. We are deeply grateful for the trust placed in us to be part of the financial journey of so many. While Easyknock may no longer be around, arrangements have been made to ensure continued services for our customers," the statement read.
Former customers were directed to send inquiries to an email belonging to NESE Property Management based in Cleveland.
The demise of the company, perhaps known best for its sales-leaseback products, comes at the end of a two-year stretch marked by both promising growth and controversy.
The past year saw the company facing lawsuits and enforcement actions in several states, including Connecticut, the most recent to file against Easyknock in November. Adding to the publicity, a National Public Radio investigation into the fintech threw an unwanted spotlight on the client agreements this summer.
At the heart of Easyknock's troubles in 2024 was its sale-leaseback product, which many consumers claimed they did not understand required them to cede homeownership to the company, essentially turning them into rent-owing tenants. Attorneys general across the country accused the business of dishonest marketing tactics.
Easyknock was one of a
As platforms offering shared appreciation, also referred to as home equity investments, they are not classified as lenders, nor do the products fall under usual mortgage banking rules regarding required disclosures. The home equity investment industry has fought efforts in some states to tighten regulation around their products.
Easyknock emerged victorious in one of its lawsuits this fall after a court-appointed arbitrator in Texas rejected plaintiffs' claims of fraud and misrepresentation and called the sales leaseback agreement "a valid and enforceable contract." The lawsuit was filed by former clients, who lost their home to the company.
In addition to Texas and Connecticut, the platform faces legal action in Maryland, South Carolina, Pennsylvania and Ohio, and enforcement in Michigan and Massachusetts.
In spite of the legal scrutiny and a slowing technology funding environment, Easyknock still managed to successfully attract the attention of capital investors over the past several months, with growth momentum seemingly on its side this year.
At the start of 2024, the company announced it had raised $28 million in a Series D funding round backed by Northwestern Mutual. Since 2018, New York-based Easyknock received almost $430 million in capital funding, according to Crunchbase.
As part of its growth strategy, the company also signed an "expansive" marketing agreement with Iheartmedia in May that included digital and on-air promotion of its products.
Beginning in early 2023, Easyknock snapped up four different companies that allowed it to broaden its offerings. Starting with all-cash purchase platform Ribbon, Easyknock followed with purchases of Onder, Balance Home and Homepace, the home equity sharing fintech it acquired in the first half of 2024.
