Over Fifty Group (OFG) will not accept new applications for reverse mortgage loans following a recent review of company operations.
New loan applications closed yesterday, however all applications received prior to then will be processed in the usual manner.
OFG will continue to offer full service to existing customers, including the provision of further draw downs on undrawn loan balances and other administrative matters.
The decision to suspend applications was a positive and integral component of the recent review of operations, according to OFG chief executive John McBain.
“OFG has continued to offer a reverse mortgage product while the majority of lenders have withdrawn from the market during recent turbulent credit markets, causing a flood of applications,” he said.
“Ultimately we believe increasing balance sheet exposure in this sector would be inappropriate given OFG’s size and our conviction to concentrate on core activities.”
OFG has a reverse mortgage book of around $230 million and the suspension limits the reverse mortgage division’s maximum balance sheet liability to the current approved level, McBain said.
“We believe that this is the type of product best offered by a large institution such as a bank or a building society.”
