Finance of America Companies Inc. announced the expanded launch of its HomeSafe Second loan so that more homeowners 55 and older have a tool to access their home equity without adding new monthly payments or changing the existing rate on their first mortgage. With the wider rollout across its direct-to-consumer and wholesale divisions, Finance of America will increase the availability of this second-lien reverse mortgage product to homeowners and originators. Home price appreciation means many U.S. homeowners have seen significant increases in their housing wealth in recent years, and while this is driving interest in HELOCs and other home equity products, many are unable to benefit from home equity gains for a variety of reasons.

Selling the home and downsizing may not be feasible due to increased costs to purchase or rent. Refinancing and traditional home equity loans are less attractive options given higher interest rates. Moreover, qualifying for home equity products can be difficult with nearly half of applicants (46%) failing to qualify for a HELOC.

For older homeowners, receiving home equity financing is even more challenging, with one-third of all senior refinancing applications denied due to income-based criteria. HomeSafe Second was intentionally developed to address these barriers and serve homeowners 55 and older in today's climate. The only second-lien reverse mortgage of its kind, HomeSafe Second allows eligible homeowners 55 and older to tap their home equity via a second mortgage without adding a new monthly mortgage payment.

This fixed-rate, proprietary reverse loan does not impact the first lien mortgage, neither its balance nor its rate, and no monthly payments are required on this second lien. The borrower must continue to make payments in respect of its first lien mortgage along with property taxes and insurance. HomeSafe Second is currently available in California, Colorado, Connecticut, Florida, South Carolina, and Texas, with the goal of expanding to more states in the future.

Additional information including product details and loan terms is available on the product section of the FAR website.