Following several recent reverse mortgage product roll outs, Live Well Financial today announced another new Home Equity Conversion Mortgage Product and an open-end, fixed-rate option for borrowers.
The new product, the HECM Fixed Freedom requires no minimum draw upon loan closing, access to the full principal limit under various plan options, a set fixed rate, and an open-end product. The announcement comes on the heels of a product announcement this week from Reverse Mortgage Funding that allows borrowers the option of the full array of payment plans at closing, all under a fixed rate.
The option to take a line of credit at a fixed rate presents a “sea change,” and is different from other available reverse mortgage options in the past or present, says Live Well senior vice president Jim Cory.
“The introduction of open-end fixed rates combined with the flexibility of the payment plan options with the HECM Fixed Freedom represents a sea change in our industry,” he says. “Most importantly, our borrowers will be the primary benefactors of this added flexibility, however this will also go a long way to leveling the playing field between brokers and lenders.”
Loan originator compensation rules under the Federal Housing Administration allow for different compensation structures depending on whether a loan is considered open end credit or closed end credit.
“For approved brokers, this means no more closed-end loan originator compensations plans are necessary,” Live Well explained in announcing the product.
Written by Elizabeth Ecker