“Our ability to access cost-effective and reliable sources of funding as a bank has allowed us to lower our cost of borrowing and pass the savings to our customers. The increase in originations during the last quarter is an early indication that our pricing strategy is working and that our reverse mortgage offering is being transformed from a niche product into a mainstream financial solution,” said Steven Ranson, President and CEO.

Earlier this year HomEquityBank received its federal bank charter allowing it to gather deposits and allow it to offer lower rates to consumers.

Ranson told the Wall Street Journal that they now charge 3.75% on a variable-rate reverse mortgage (its lowest ever), and only 1.5 percentage points above prime.  Five-year terms are available at 6.1%.

During the 2008 credit crunch, when funding rates soared, HomEquity’s rates were as high as prime plus 5 percentage points, according to Ranson.  “Pricing is now more comparable” to other options seniors may have, making a reverse mortgage far more appealing.