Meeting Financial Freedom

Those enormous loans don't materialize out of thin air. That's a lot of money to lend, and someone has to foot the bill. Jumbo Cash Accounts are also often called private lender or proprietary loans because the companies who fund them are individual private corporations. They have no ties to the government (which has its benefits and challenges) and can essentially create their own interest rate basis, loan requirements, and eligibility.

The biggest and most prevalent financer of reverse mortgage Jumbo Cash Accounts is called Financial Freedom (you can find out more about Financial Freedom and get free supplemental information by calling 1-888-738-3773 or visiting www.financialfreedom. com). The company was founded in 1996 and is owned by IndyMac Bank, a nationwide mortgage lender. It's natural to be a little suspect of a company whose name you may not recognize and isn't backed by government programs, but rest assured that Financial Freedom is a deep-seeded corporation that's here to stay. They have a vested interest in reverse mortgage loans, are active in the National Reverse Mortgage Lenders Association, and pride themselves on being one of the largest reverse mortgage lenders in the country. There are other companies who offer these loans, but so far they only originate in a few of the larger states.

Financial Freedom actually has the capacity to fund all kinds of reverse mortgages, but the Jumbo Cash Account is their pride and joy. You'd have pride and joy too if you could afford to lend someone a couple million dollars.

The founders of Financial Freedom know that this is a big decision, and want to make sure that you feel absolutely confident in their practices. After all, they're asking you to put your financial future (via your home's equity) in their hands. They have created a six-step "consumer safeguard" system to ensure that every borrower is protected from what the industry calls predatory lending (originating loans that are not in the borrower's best interest for the purpose of making more money) and gets an objective, honest assessment of their financial situation. The program consists of:

  1. Requiring originators to give every borrower a document (made by Financial Freedom) that clearly shows all of their reverse mortgage options.
  2. Encouraging any of the borrower's personal advisors — whether friends, family, lawyers, or others — to attend meetings with the originator.
  3. Using HUD-approved and other "specially trained" counselors to meet with the borrower before filling out any final applications.
  4. Reviewing the loan program and product choice with a regional processing center before the application is sent to the underwriters.
  5. Conducting a secondary review at the underwriting center.
  6. Sending a customer-satisfaction survey to all borrowers to make certain that everything went as smoothly and easily as possible.

Once you and your counselor choose a Financial Freedom loan, you may consider going to a correspondent lender, an originator who is affiliated with the company. Their originators are trained in all aspects of reverse mortgage lending, but will be especially knowledgeable on the Cash Account options. They will have support from Financial Freedom's training and product literature sources and are held to the company's standards.

^LSi^ It's only fair to say, however, that most — if not all — approved .¡K reverse mortgage originators (and you should only ever go to an approved originator) have similar rigorous standards that they adhere to. Any member of the National Reverse Mortgage Lenders Association (NRMLA) will be held to strict codes of conduct.

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