When 1st Reverse announced it was releasing a new jumbo reverse mortgage product, there was plenty of questions from RMD readers. Below is some additional information about the new FLEX jumbo reverse mortgage product :
- Index = 1-Month LIBOR
- Margin – 5.500
- Available for refinances and purchases.
- Eligible Property Types – SFD, Condos, PUD’s, and 2-4 units (if one unit is owner occupied
- Proprietary counseling required (IAMP)
- Eligible states = AZ, CA, CO, CT, DOC, DE, FL, GA, HI, IL, MI, MD, NY, NC, NH, NJ, NM, MD, NY, NV, OH, OR, PA, RI, SC, VT, WA, VA, WI
Borrowers with property values of $1.5 million and up will find the FLEX provides a competitive alternative to a HECM, even with the higher loan limits. Below is an example of how the product compares to a HECM for a borrower with no mortgage balance.
| Fixed HECM | Flex Jumbo | |
| Rate | 6.31 | 5.978 |
| Home Value | $ 2,500,000 | $ 2,500,000 |
| Principal Limit | $ 498,125 | $ 750,000 |
| Avail Cash | $ 467,878 | $ 711,250 |
Correspondents will be required to complete the mandatory webinar training in order to be able to originate the FLEX product. Initially, the product will be rolled out to a select group of correspondents said Ralph Rosynek, President of 1st Reverse.
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The age of the borrower in the example is?? 80/81??
Rumor has it that it is NOT a “reverse mortgage” but instead a “term” loan with a lump sum due date of 7, 10 or 15 years. …and cash-out is required.
Do the math, this term loan won’t be able to be refinanced as the equity will be all used up. The years come and then what?
I guess this would be an option for people with a 2.5 million dollar house (not less and not more) who have no other options because their credit/income is bad and they are about ready to lose their home in a foreclosure sale.
I say; “don’t get too excited about this product until you get all the facts”.
Ms. Former FF Gal
This is not a term loan this is a tenure loan. Please contact Jamie Longe, National Wholesale Director at 1st Reverse jlonge@1streverse.com for the facts.
Who cares… Just like every other product that 1st Reverse has- you wont make any money on this loan. All of their loans are “feel good” loans- I guess for people who do reverse mortgages out of the goodness of their hearts. What a joke!
Not only is this jumbo just a “feel good” product with virtually no commissions but also 1st Reverse does this for the publicity. Nothing more!
Good luck contacting 1st Reverse and getting a response… They are all so hush hush over there…
In Maryland for example there’s a recordation tax that could easily be $5000. I’m not defending their numbers, just giving an example of where that extra money could come from.