Maine Governor Signs First-in-the-Nation Law to Protect Homeowners From Home Equity Investment Loans

April 17, 2026 — Press Release

Law Provides Homeowners With the Most Comprehensive Protections in the Country 

BOSTON — This week, Maine Governor Janet Mills signed a bill making Maine the first state in the nation to create essential consumer protections for home equity investment (HEI) loans, called shared appreciation mortgage loans in the new law. The new law, LD 1901, An Act to Regulate Shared Appreciation Agreements Relating to Residential Property, provides safeguards from this growing class of complicated, high-risk financial products, which lure homeowners with the promise of upfront cash and no monthly payments, hiding large, unknown lump-sum payments. 

“With the signing of this groundbreaking bill, Governor Janet Mills brings transparency and fairness to the home equity investment loan process,” said Andrea Bopp Stark, senior attorney at the National Consumer Law Center (NCLC). “This legislation applies comprehensive boundaries to a complex financial product that is often marketed and sold without regard for the long-term impacts on homeowners.”

Representative Art Bell (D-Yarmouth) sponsored the bill. The Maine Bureau of Consumer Credit Protection, led by Superintendent Linda Conti and with the active involvement of Principal Examiner Ed Myslik, provided strong support for the bill.  

The new law defines a category of mortgage loans, so-called “shared appreciation mortgage loans.” These are defined as loans where a homeowner receives cash up front in exchange for a future interest in their home’s value, secured by the property and repayable upon a specific event like a sale or death. 

The repayment amount is unknown when the loan is taken out and is due as a lump sum balloon payment that can be tens or even hundreds of thousands of dollars more than cash received, often forcing homeowners to sell their homes. These loans strip equity, depleting assets needed for retirement, healthcare, or family wealth transfer.

These loans are marketed to homeowners across the country, particularly older adults with significant equity and homeowners with lower credit scores. They have caused significant harm. 

The new protections in the law include: 

• robust disclosures that provide the actual costs of the loan; 
• a requirement for housing counseling education and legal representation; 
• prohibitions on unreasonable restrictions on renting, occupying, and maintaining the property; and 
• liability for claims and defenses with respect to the loan that the homeowner may assert against the lender for anyone who buys or is assigned the loan.   

“HEI loans may be marketed as a lifeline to a homeowner in trouble, but they are a trap that siphons away people’s hard-earned equity,” said Maine attorney Tom Cox. “Thanks to the Maine Legislature and Governor Mills, Mainers will have one less bad financial actor to contend with.” 

NCLC has long advocated for the regulation of HEI loans. NCLC attorneys provided technical assistance in the development of the bill and testified in support of the bill.

Related Resources

• Issue Brief: Home Equity Investment Loans Are Subprime Mortgages: Federal and State Policymakers Should Update Rules to Protect Consumers, Mar. 27, 2026
• Article: Home Equity Theft Scams—An Old Problem Takes on New Forms, Jan. 27, 2026
• What States Can Do to Protect Homeowners from Home Equity “Investment” Loans, Sept. 3, 2025
• Model Law for Home Equity Investment Loans, Sept. 3, 2025
• Article: Courts Expose Deception of Home Equity “Investments,” Aug. 15, 2025