In the past year, the reverse mortgage industry has seen a number of non-agency reverse mortgages come to market.
While they are not insured by the Federal Housing Administration like their HECM counterpart, they can cater to homes that exceed FHA’s claim amount – offering up to $4 million of home equity in cold hard cash – and they come free of the costly mortgage insurance that can be a deterrent for the HECM.
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Now, five lenders offer proprietary reverse mortgages with varying features not available on a HECM, like a second-lien and a line of credit, and word has it one more is about to come to market.
But while most lenders say interest in their jumbo reverse products has been strong – with some saying it has even surpassed expectations – data is sorely lacking on just how many of these non-agency reverse mortgages the industry is actually closing.
To shed some light on what’s really happening, we reached out to a handful of active reverse originators to learn about what they’re seeing in the field.
Are more borrowers approaching them about proprietary reverses? Are they encountering a sizable number of borrowers who would even qualify? Do they see these products as the saving grace for a struggling industry?
Here’s what they had to say: