Early last month Financial Freedom released a new product called the HECM Advantage™. The press release states that compared to the HECM monthly adjustable product with the old margin of 1.5%, the HECM Advantage™ offers a lower interest rate and access to more home equity that can be converted to cash at a lower overall cost over the life of the loan. According to Michelle Minier, CEO of Financial Freedom, “We examined all aspects of the reverse mortgage and its cost structure to identify opportunities to enhance benefits and reduce cost beyond just simply reducing the margin”.
The HECM Advantage™ is the first release in a suite of new HECM and Cash Account reverse mortgage products that the company will be releasing in the coming months. Jim Mahoney, Chairman of Financial Freedom, states that, “We were the first to offer a jumbo reverse mortgage and continued to enhance the product to provide a no upfront cost option for consumers, now called Cash Account Advantage. In 2007, we will introduce multiple, competitively priced products for both the HECM and jumbo markets consistent with our customer philosophy.”
This is exciting news for the jumbo market which is going to be seeing a real change in the type of products that will be available in the next year. There is expected to be new competition from BNY Mortgage who is going to be offering a new jumbo option in the coming months as well as a few others.