Reverse Mortgage Funding (RMF) is now licensed to originate Home Equity Conversion Mortgages (HECMs) in the state of New York to homeowners and homebuyers, and will offer the loans through both its retail and wholesale channels. The addition of the lender’s New York license brings its total origination footprint into 49 states and the District of Columbia, with Hawaii being the only state remaining that it is not licensed to originate in.
“New York State has a thorough review process and we appreciate the due diligence they take to protect homeowners/buyers in the state,” said Mark O’Neil, National Sales Leader of RMF’s wholesale and correspondent business channel, in an email to RMD.
The gaining of this license will open up the company to open up its operations into two key lines of business, according to O’Neill.
“We’ve been buying and servicing closed loans in NY all along,” O’Neil says. “This change allows us to now begin accepting wholesale and Principal/Agent loans, both of which are very important lines of business to us.”
One other possible new avenue that is opened up by gaining its license in New York state is condominium originations, which have the potential to make up a notable portion of the company’s business in the area.
“I’d anticipate that condominiums, whether they be full project approvals, or spot approvals, will make up a meaningful percentage of our NY business,” he says.
While now able to originate within New York, RMF as a company already had a notable presence within the state. Two operational centers on Long Island and in Newburgh employ over 130 people, and RMF President David Peskin lives and works in New York. The attainment of a license to originate HECMs within the state makes for a natural extension of the company’s presence, Peskin said.
“We are thrilled to now be able to serve New Yorkers, and to provide older homeowners and homebuyers here with access to RMF’s industry-leading expertise, our extraordinarily caring, personalized service, and the pricing advantages we can offer as a direct lender,” Peskin said in a press release.
In an effort to further establish itself as a reverse mortgage lender in New York, the company will be performing outreach to community banks and credit unions to add HECMs to their New York customers and members, with the company’s “TurnKey” platform being designed for depository institutions to begin offering reverse mortgage loans, Peskin says.
Efforts will also include direct outreach to New York seniors.
“We’ll be doing community outreach to New York homeowners age 62 and older, so they can learn how to strategically use home equity to ease financial concerns,” Peskin said in the press release. “We will also be working with financial advisors and realtors in the state, to help them better understand how the product can be used to help their older clients enjoy their retirement years with more financial flexibility.”
New York has been a relative hotbed of reverse mortgage activity over the past several months. This past summer, Finance of America Reverse (FAR) announced that it would make its HomeSafe proprietary reverse mortgage product available in the state.
For RMF, the company will turn its attention to getting its own proprietary products approved within the state sometime in the future.
“The state of New York has a separate approval process for proprietary reverse mortgage products, such as Equity Elite,” O’Neil says. “Soon, our team will begin work on this initiative.”
The state’s regulatory climate is also poised to get stricter, as the New York State Assembly in May passed a bill that requires reverse mortgage lenders to provide supplemental consumer protection materials to borrowers, while also imposing restrictions on lenders related to their payment of insurance premiums and property taxes.
The bill also requires that both lenders and borrowers be represented by an attorney at the time of closing, and at least one attorney must be present to conduct the closing itself. However, the pending bill did not affect RMF’s application to originate within the state, and the company is unaware of any impact the bill may or may not have had on the ultimate approval of its license.
RMF will begin accepting New York loans from its approved wholesale and correspondent lenders as of Monday, Oct. 21, 2019.