After a two-month wait, MetLife has announced they will release their new reverse mortgage policy later this week. For MetLife, the new changes to the policy are designed to insure only borrowers who can afford the program will be eligible, taking into account other issues. The main criteria include having insurance on the investment, and being able to pay the taxes on the reverse mortgage.
Naturally, the more stringent requirements for qualification for a reverse mortgage from MetLife have caused some applicants and mortgage managers to take clients to less restrictive companies. MetLife has stated that if these people do not qualify for the program, it will make the program stronger and more resilient if another 2008 situation occurs. The idea is to protect the company and the mortgage holder for the long haul. This was the original goal of the program, and appears to be working.
Official guidelines will be released by MetLife later in the week, giving a clearer picture of who qualifies for the program. The two months of planning on these new guidelines has been a tough period for brokers, who were uncertain the way the program implementation would transpire. Once the guidelines are formally released, it is expected they will be reviewed several times in the coming year to ensure they are meeting the needs of MetLife and the customers.
Investors are waiting to hear what the new requirements look like officially. If they appear to restrictive, these investors may move towards other companies. While the number of investors who focus on reverse mortgage markets are low, they still have some pull in which companies are the attractive opportunities for borrowers.
MetLife has spent two months examining many programs. MetLife expects the new requirements will maintain longevity of their highly successful reverse mortgage lending program.
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