State Employees’ Credit Union’s (SECU’s) consumer-friendly Reverse Mortgage was introduced in August 2008 and has since closed 50 reverse mortgages totaling over $5 million according to the company’s statement.
SECU’s loan is a fixed rate product that uses simple interest accrual and has an origination fee of 1%. Unlike the HECM, its “consumer friendly” reverse mortgage also has no mortgage insurance or monthly service fees. SECU firmly believes the reverse mortgage market could prove to be the next subprime debacle and has worked to be ahead of the curve in order to provide a different cost effective product that other credit unions could emulate.
In developing their consumer-friendly product, the Credit Union consulted with the North Carolina Housing Finance Agency, North Carolina Commissioner of Banks, North Carolina AARP, the NC Retired Governmental Employees Association and Resources for Seniors – a counseling group for reverse mortgage applicants, for their expertise on reverse mortgages.
“After extensive research of standard reverse mortgage products, the Credit Union developed a product far superior to the industry standard, resulting in more funds being made available to our members for their day-to-day living expenses,” said Phil Greer, Senior Vice President of SECU’s Loan Administration department.
“While this type of loan will not benefit all members, the ones who need this option can rest assured they are getting a product that will not be detrimental to their financial well-being,” said Greer.