Finance of America Reverse (FAR) announced that it has lowered the minimum age requirement from 62 to 60 on three of its proprietary HomeSafe loan products: HomeSafe Standard, HomeSafe Second and HomeSafe Flex, according to an announcement shared with RMD.
“We are pleased to meet industry demand for this amendment but stress that borrower responsibility is paramount in factoring in whether this new timeline makes sense for their long term retirement goals,” said Kristen Sieffert, President of FAR in a press release announcing the new minimum age requirement.
The reduction in the minimum age requirement will serve to further expand the base of borrowers that can be served by FAR’s proprietary offerings, the company said.
“Starting HomeSafe at age 60 expands horizons for originators, and greater opportunity is exactly what FAR seeks to bring to the table,” says Jonathan Scarpati, VP of Wholesale Lending for FAR in a statement to RMD. “Now our partners will be able to help even more people get to work on retirement.”
While availability of the loans with this new provision largely mirrors the states in which HomeSafe products are already offered, loans with the new minimum age requirement will not be available in Texas and Utah. In its announcements, FAR is very clear to illustrate that there are factors that need to be considered by individual borrowers in terms of their personal financial situations before engaging in one of these loans.
“Leveraging the earlier age option can make sense for those that need to enhance their cash flow earlier in the retirement process,” said Dan Hultquist, FAR VP of Organizational Development in the announcement release. “The caveat is that this may extend the life of a loan, which would mean that more interest accrues. So, as with any mortgage-related product, borrowers need to make sure that this is appropriate for their specific financial situation.”
FAR recently made its HomeSafe Standard loan available in Massachusetts, one of the loan variations with the revised minimum age requirement.
HomeSafe Standard is a full draw, fixed rate loan that offers the ability to customize features for borrowers seeking low costs or maximum proceeds. HomeSafe Flex allows for more flexible draw of the loan’s proceeds, while HomeSafe Second is the first-ever second-lien reverse mortgage.
FAR currently stands as the third largest reverse mortgage lender by volume as of October 2019, according to data from Reverse Market Insight (RMI).