Pentagon Federal Credit Union (PenFed) and Sun West Mortgage Co. have announced a joint initiative that allows PenFed to offer reverse mortgage services to its members.
Under this new initiative, PenFed will initially market the federally insured Home Equity Conversion Mortgages (HECMs) to its members located in Washington, D.C.; Maryland; and Virginia, and Sun West will provide systems to originate and service the loans.
PenFed says it expects to launch this product nationwide after the initial pilot is complete. PenFed's reverse mortgage eliminates the up-front origination fee – 2% of the adjusted property value – and the $35 monthly servicing fee that are customary in the industry, the credit union says.
‘We work with numerous providers of the HECM product, and we believe PenFed's approach is a revolutionary, first-in-the-nation development," says Pavan Agarwal, executive vice president of Sun West.
SOURCES: Sun West Mortgage Co.