Colorado Homeowner Sues Unlock Over Home Equity Deals
A class action alleges the company's home equity agreements were disguised mortgage loans that evaded Colorado lending laws.
Updated on Nov. 3, 2026 in Residential
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Colorado homeowner Sheila Johnsen filed a class action against Unlock Partnership Solutions and co-defendants, including Unlock Technologies, Wilmington Savings Fund Society, and U.S. Bank Trust National Association, as of October 1, 2026. The suit brings 13 claims and is represented by Halperin Petersen & Mikkilineni LLP.
Why it matters
The complaint alleges Unlock's cash advances secured by home deeds exceeded Colorado's interest rate cap for unsupervised loans, placing homeowners' property at risk under terms they may not have fully understood. The case tests whether home equity products marketed as alternatives to mortgages fall under state lending rules.
The complaint alleges Unlock's 19.9% annualized cost limit exceeded Colorado's interest rate cap for unsupervised loans, and that agreements requiring repayment within 10 years span nearly 100 pages. Whether the agreements are legally mortgages has not been determined.
The players
Unlock Partnership Solutions
The company offered home equity agreements that provided cash advances secured by homeowners' property, and it is the primary defendant in the class action.
Halperin Petersen & Mikkilineni LLP
A law firm founded in July 2026 by three former CFPB enforcement officials, representing Colorado homeowner Sheila Johnsen.
Eric Halperin
A former CFPB enforcement division leader under the Biden administration and a founder of Halperin Petersen & Mikkilineni LLP.
The details
Unlock offered homeowners cash advances secured by deeds of trust on their homes and marketed them as alternatives to traditional mortgages. Under the agreements, homeowners were required to cover property taxes, insurance, maintenance, and other fees, and Unlock could receive twice the percentage of a home's value it initially advanced.
Timeline
Oct. 1, 2026: Johnsen v. Unlock Partnership Solutions Inc. case date listed
July 2026: Halperin Petersen & Mikkilineni LLP founded by three former CFPB enforcement officials
Nov. 3, 2026: Class action reported
Residential Lending Context
The case challenges whether home equity agreements marketed as alternatives to mortgages can evade Colorado's interest rate cap for unsupervised loans. Its outcome could determine how similar products are regulated in the state.
Colorado homeowners with existing home equity agreements may want to review their contract terms, including repayment timelines and fee obligations. Those considering similar products should compare the total cost and repayment requirements against traditional mortgage options.
The takeaway
Home equity products marketed as alternatives to mortgages can carry costs and obligations that differ significantly from conventional loans. Homeowners weighing such offers should examine repayment terms and total fees before signing.
Further reading
For more on related housing finance topics, explore Residential coverage.
Source note: This article includes information reported by ABA Banking Journal.
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