Financial Freedom released an adjustable rate HECM product with a 200 margin and no servicing fee to wholesale customers on Tuesday.
While other wholesalers like Live Well Financial have offered a no SFSA for adjustable rate reverse mortgages to brokers, Financial Freedom’s margin makes it the best in the market said several brokers on Wednesday.
For the last few months, brokers haven’t been able to compete against banks since they’re eliminating the upfront costs and servicing fee for adjustable rate products. The new offering from Financial Freedom allows them to at least remain competitive, but none of the lenders said they planned to send the company any business.
For years, Financial Freedom was the largest wholesale lender and no one came close to matching their production. But when IndyMac started to run into trouble, the company’s volume started to fall dramatically and continued after it was acquired by One West.
Despite One West claiming it’s dedicated to the reverse mortgage business, this year hasn’t been any better. Wholesale reverse mortgage volume is down 72.8% during 2010, making them the 6th largest wholesale lender according to data from Reverse Market Insight.
One has to wonder whether this is the last ditch effort to drum up some business. RMD asked the company, but has yet to receive a response.