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Flex Mortgage

Flexible mortgages help debt problems

Britons are feeling particularly positive about flexible mortgages at present, as they see them as a good way to ward off debt problems. This is ...

FAR Rolls Out 'Flex' Option for HomeSafe Jumbo Reverse Mortgage

On the secondary market. 

FAR then teamed up with industry leader American Advisors Group to offer the HomeSafe on a correspondent basis in March, with AAG branding the products as “AAG Advantage” through its retail channel.

The HomeSafe Flex mortgage will initially be available through the retail, wholesale, and correspondent channels to consumers in California, Florida, and Texas. Additional states will join the lineup over the next several weeks, according to a FAR spokesperson. 

“Our mission at FAR is to continuously innovate so that our partners and reverse mortgage specialists have access to a broad product suite to meet the varying needs of the clients we serve over the course of their retirement years,” Sieffert said. “The introduction of the Flex option is one step further toward that goal, and we anticipate introducing additional products into the market later this year.”

FAR’s jumbo expansion represents just one example of proprietary reverse mortgage growth in 2018: Reverse Mortgage Funding introduced its private Equity Edge loan, designed for borrowers with homes valued at $700,000 or more, last month, and Longbridge Financial indicated that it plans to offer multiple new proprietary products this year.

Interest-Only Makes a Comeback

Innovative mortgage products. Remember those?

With Ottawa’s onslaught of rule tightening, it’s been a while since we’ve seen a new product that was substantially unique. This is one of them.

Merix Financial , the broker channel’s seventh-largest lender by market share, is launching the Interest-Only Flex mortgage on Monday.

The IO Flex has one key purpose: to cut a borrower’s monthly carrying costs.

While the rates are higher than a conventional amortizing mortgage (as you’d expect given the higher risk), the payments are materially lower.

Take a $300,000 30-year-amortized mortgage, for example. A traditional adjustable-rate mortgage at prime – 0.75% has a payment of $1,214.

The IO Flex mortgage has a payment of just $918, almost $300 less each month. That’s based on a 5-year adjustable interest-only rate of prime + 0.25%, a rate that is one point higher, but a quarter point less than most HELOCs.

Of course, you pay a whack more interest on the mortgage itself, but interest cost is not necessarily determinant of net worth. That’s because the cash flow savings can be redirected to things like:

Who should get a flex pay mortgage loan?

So my husband and I have found a home that we really love but its out of our price range at the current moment. I have a job in September on hold when I graduate from college and we will be able to afford the house then, but it will probably be gone.

Those loans are generally gone. They are certainly gone if you also don't have a down payment.

The reason they are gone is that they were too high risk for the average person to correctly handle.