Lenders Says It Cuts Reverse Mortgage Fees

While reverse mortgages have many attractive aspects, steep up-front fees have not been among them. Now, however, a lender says that it’s offering reverse mortgages with lower up-front costs.

Reverse Mortgage Lending explains that the “high efficiency and decreased costs of internet marketing have lowered the company’s costs, allowing them to pass those savings on to the seniors they help.”

“Many people that could benefit from a Reverse Mortgage have been reluctant to go forward due to the high initial costs.” Said Wally Welter, President of Reverse Mortgage Lending, Inc., noting that a big percentage of those costs are actually set by the FHA.

“The decreased costs and efficiency of using the internet to disseminate information about our company and Reverse Mortgages is exciting. This has allowed us to significantly lower our costs. “ said Welter. “This means we can offer what we believe to be the lowest cost FHA Reverse Mortgage in the State of California. The absolute most anyone will pay in origination fees for loans we originate via the internet is $2,995, and if the borrower is willing to complete the application process via the mail, we lower it to $2,495. This results in putting almost $5,000 of additional money in the pockets of our senior borrowers.”

Up-front costs are just one of the issues to review when considering a reverse mortgage. One would certainly want to see if the interest rate is competitive, if the margin is as good or lower than other lenders, which index is used, whether there are any other costs or fees, etc. That said, offering lower up-front is important because such fees should be competitive, they are not set in stone.

As always, be sure to compare a variety of reverse mortgage offerings and consult with an attorney who specializes in elder law before signing paperwork with any reverse mortgage lender.

This entry was posted on Monday, July 30th, 2007 at 4:39 am and is filed under Reverse Mortgage . You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.