Reverse Mortgage Funding announced Monday that it is rolling out updates to its Equity Elite proprietary reverse mortgage, now to include both lump sum and term disbursement options for borrowers under a fixed rate.
The product expansion, which allows borrowers to choose any number of term payments from 24 to 120 months, follows a series of new product features introduced across the reverse mortgage proprietary market landscape over the last year, presenting more and more options for borrowers and originators of reverse mortgages. RMF announced in March that it was rolling out new options for reduced origination fees and borrower closing costs.
“In our view, we were looking for something to […] be able to give the borrower some more flexibility and get a fixed rate,” said David Peskin, president of RMF in an interview with RMD. “So, our product now allows the borrower to take the remaining proceeds.”
Initially launched in May 2018, Equity Elite targets borrowers with home values of more than $700,000 and can be used for qualifying condos, including those that are not Federal Housing Administration-approved.
“RMF is committed to product development — expanding product features to satisfy the varied needs of older homeowners,” the company said in an email announcing the changes.
The new feature is currently available in California, with plans to expand to other states in the near future.
“We rolled out California today, and the goal is to roll out seven or eight states over the next few weeks,” Peskin said. “No different than we did with our Equity Elite product, we would roll it out and get it out there and start doing business with the product, make sure the back office is handling it properly and that the technology is working, and then we’ll start adding states from there.”
Industry participants have reported strong interest and activity in the proprietary market in recent months, but there is yet to be a public data repository to track loan closings for non-FHA reverse mortgages.
“We’re really excited, because we feel that it helps solve that void for that customer who does not want all of those proceeds on day one, and is thinking about wanting to have access to the remainder of those proceeds over time,” Peskin said. “Instead of getting an adjustable rate, they could have a fixed rate with a set monthly payment schedule.”