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SECU rolls out friendly reverse mortgage
RALEIGH, N.C. (8/5/08)--State Employees’ CU (SECU), Raleigh, N.C., announced a consumer-friendly reverse mortgage designed to help senior members make use of the wealth in their homes. The loan offers a fixed rate of interest and an origination fee of 1%. There are no mortgage insurance or monthly service fees, SECU said. Borrowers must be 62, use the home as their primary residence and receive consumer education on the product from a North Carolina-certified reverse mortgage counselor. “SECU investigated the reverse mortgage marketplace and we saw numerous opportunities to provide this important product to our members, reducing the typical costs being assessed,” said Phil Greer, SECU senior vice president of loan administration. “Through reduced fees, a fixed rate of interest and a simple interest accrual method, we will provide the member with an enhanced use of their equity,” he added. A reverse mortgage is a loan against a residence to provide cash to assist with living expenses, typically in the form of a lump sum or fixed monthly disbursement to the borrower. SECU used assistance from senior-affiliated organizations to design a reverse mortgage product. It also published a booklet for members to learn about the product. “A reverse mortgage can be a useful financial option for older homeowners who need to supplement their retirement income to help pay for essential needs,” said Mary Reca Todd, manager of supportive housing for the North Carolina Housing Finance Agency. Seniors in the market for reverse mortgages can be vulnerable, according to Ed Regan, executive director of the North Carolina Retired Governmental Employees’ Association. Like Todd, he encouraged financial institutions to provide consumer education to seniors. “Consumer education is crucial in making sure the older population does not fall victim to what could be the next frontier for mortgage scams,” he said. SECU has $15 billion in assets.


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