Bank of New York (BNY) Mellon will soon be the only major bank to offer reverse mortgages with the rollout of its new reverse mortgage division, Forbes reports.
The world’s largest custody bank will launch Home Equity Retirement Solutions later this year, and the move is expected to attract more funds to its asset management business, Forbes says.
The business will purchase, securitize and service reverse mortgages, and will also provide advisory services to brokers, financial advisors and asset managers on how the loans fit into retirement plans.
This will be the bank’s second foray into the reverse mortgage market. BNY Mellon exited the sector in 2007 after offering reverse mortgages for eight years. That channel was sold to EverBank. EverBank was later acquired by MetLife Bank.
The new move may inspire other top lenders, such as Bank of America and Wells Fargo, to re-enter the market in the coming months as well, Forbes says.
“There remains a demand for reverse mortgages across the country, and currently this demand is almost completely addressed by lenders focused on the market,” Forbes says. “BNY Mellon’s ability to provide reverse mortgages along with other retirement options should give it a competitive edge over incumbents.”
BNY Mellon currently works as an asset manager for 401K plans and defined benefit investments. It has $1.6 trillion assets under management and operates in more than 100 markets, according to its company website.
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Written by Cassandra Dowell