Ginnie Mae’s decision to provide credit enhancement to reverse mortgage securitizations will likely jumpstart secondary market sales of the loans, helping to expand the burgeoning origination market, said Peter Bell, president of the National Reverse Mortgage Lenders Association.
Two of the largest reverse mortgage originators — Financial Freedom Senior Funding Corp., a unit of IndyMac Bancorp, and Reverse Mortgage of America, a unit of Seattle Mortgage Co. — are likely to securitize loans in the near future, Bell said. Additionally, lenders such as Bank of New York Mortgage, which recently started a reverse mortgage operation, would likely be a candidate for the securitizations as well, he added.
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