Some home equity loan originators have a tendency to bend the truth, and a blog post from All Reverse Mortgage Company has reacted to this by pointing out some of the more important things potential home equity lenders need to know:
- All lenders who originate FHA-insured home equity loans determine benefits using the same calculator – assuming they use the same birth dates coupled with the same property values. Quotes among originators vary only because of fees and rates.
- There is no “industry standard” rate, although the range for rates and programs tend to be narrow due to the generally low number of originators and a weak secondary market for these loans.
- Consumers and home equity loan originators have no way of finding out how many loans an originator has closed. This means an originator will be lying if he or she produces any number indicating a competitor’s closed loans.
- It is an “ethical violation” to under-quote the rates set by the National Reverse Mortgage Lenders Association (NRMLA) while it is outright illegal to advertise rates that are not actually available.
The post goes on to advise potential home equity loan borrowers to check the Better Business Bureau website to assess a company’s rating and to check out what other customers have to say about that company. In addition, it’s also vital to consider both reverse mortgages pros and cons before deciding on it.