Reverse Mortgage Funding announced Monday that it expanded the payment options on its proprietary reverse mortgage – the Equity Elite – to include term payments.
Previously, Equity Elite borrowers could withdraw up to $4 million in their home’s equity in a lump sum only at closing. Now, borrowers can select any number of term payments between 24 and 120 months.
RMF said the term option is currently available to borrowers in California and that it expects to rollout in other states soon.
Unlike the HECM and the other proprietary, or non-agency, reverse mortgages on the market, RMF’s Equity Elite can accommodate borrowers as young as 60, whereas all other available products have a minimum age requirement of 62.
A spokesperson for the lender said it is committed to product development and expanding product features to satisfy the varied needs of older homeowners.
In March, RMF announced it was cutting the cost of the Equity Elite by slashing origination fees and closing costs, and making it available to a larger pool of brokers.
RMF’s National Wholesale and Correspondent Sales Leader Mark O’Neil told HousingWire at the time that updates to its proprietary offering are important to better align it with traditional mortgage offerings.
“Having a product that looks and feels and is priced a lot more like a traditional mortgage is very appealing,” O’Neil said, adding that refinements to the Equity Elite and other such products on the market is “a big step toward proprietary products being looked at as more of a mainstream mortgage and not as much of a niche, like the HECM.”
For years, 95% of the reverse mortgage market has been dominated by the Federal Housing Administration’s HECM offering, but this past year saw a wave of proprietary reverse mortgage loans hit the market.
Now five different lenders offer proprietary products with varying features, their main appeal being that they are not restricted by FHA loan limits, which are now capped at $726,525, meaning that these non-agency products can accommodate borrowers with high-value homes who want to access their equity in cash while staying put.