Finance of America Reverse (FAR), the number two reverse mortgage lender according to June origination data, has added its proprietary HomeSafe Select product to its suite of offerings in the state of Florida, the company announced Monday. This marks the first expansion of the product’s availability beyond just the state of California, and also makes the full repertoire of FAR’s proprietary products available in the “Sunshine State.”
In terms of the increased availability of HomeSafe Select, the idea of expanding the product’s availability was always a part of the plan, according to FAR VP of Best Practices Brittany Luth.
“Expanding HomeSafe Select beyond California has been our intention from the inception of the product,” Luth said in an email to RMD. “We are very pleased to launch in Florida today, and as the only proprietary LOC product in the reverse market, we look forward to making HomeSafe Select available in more states within the next quarter.”
In terms of future expansion plans, a spokesperson for FAR shared that the current aim is to make HomeSafe Select available in additional states including Colorado, Hawaii and Texas within the next few months. The increasing desire for borrowers to access their home equity at their own pace also helps in meeting the flexible needs of seniors, according to FAR President Kristen Sieffert.
“As people evaluate how home equity fits into their retirement plans, they are increasingly choosing to only draw the funds they need initially and access the remainder through a line of credit,” said Sieffert in a press release announcing the expansion. “Doing so allows homeowners to protect their equity longer so that they have more options well into the future as their needs change. We are proud to remain at the forefront of the industry as the only provider of this type of proprietary financial tool, which represents a tremendous opportunity for suitable borrowers.”
The availability of a line of credit allows for an attractive alternative to a more traditional Home Equity Line of Credit (HELOC) loan because of the absence of regular payments and different ways a borrower can draw their loan’s proceeds, according to FAR VP of Wholesale Jonathan Scarpati.
“HomeSafe Select is an attractive alternative to a HELOC particularly since there is no monthly mortgage payment required,” Scarpati said in the press release. “Through this offering – and the industry’s most comprehensive suite of proprietary products – we are greatly enhancing options for borrowers in Florida, particularly in pockets of the state with a concentration of high-home values.”
Unlike other proprietary offerings at FAR and elsewhere, HomeSafe Select is the only proprietary reverse mortgage product in the United States which offers a line of credit, allowing a borrower to partially tap their loan’s proceeds while leaving the remainder in the LOC.
When originally announced in October 2018, the line of credit came with a growth feature internally at 5 percent to be drawn and repaid at any time. The growth feature was ultimately removed in January, however, a move made in order to ensure the product’s long-term sustainability according to FAR.
FAR also announced a shift to private label servicing for its HomeSafe product line in December.
While FAR has not yet announced what future developments await in their robust line of proprietary offerings, Scarpati told an audience of reverse mortgage professionals at the National Reverse Mortgage Lenders Association (NRMLA) Eastern Regional Meeting in May that the search continues for whatever future form new offerings can take.
“We’re always looking to our next product,” said Scarpati on the panel. “It all starts with [the reverse mortgage professionals] in this room. We want to hear it from the street. [The proprietary products] we’ve created had a lot to do with borrower and partner conversations, and we’d absolutely like to see more of that in the future.”
The addition of HomeSafe Select in Florida joins other available proprietary offerings in the state from other lenders including Reverse Mortgage Funding (RMF), One Reverse Mortgage and Longbridge Financial.