Today, Lender Lead Solutions introduced their Flex Margin Advantage (TM) Pricing program which allows originators to customize the margin on the HECM. The originator has the ability to change the margin in 0.25 percent increments from 1.00 percent to 2.00 percent over the one year Constant Mature Treasury (CMT). According to David Peskin, CEO of LLS “By giving the consumer a higher rate and lower up-front fees, the broker can provide a more beneficial alternative. That is why the fixed margin reverse mortgage is a thing of the past – our adaptable reverse mortgage products meet everyone’s needs.”
So how does the higher margin allow originators the ability to lower closings costs? As of last week, I know that LLS is paying 1.00 YSP to any originator for sending them a HECM 150 loan. So I am assuming that if they deliver a HECM with a 2.00 percent margin they will be paid more on the back end. This will allow the broker to customize the reverse mortgage for the borrower by possibly lowering the premium that they charge up front. To read a copy of the press release click the link below.