One Reverse Mortgage Review

A reverse mortgage is specifically designed for homeowners age 62 years and older with at least 50% home equity. Instead of making monthly mortgage payments, the reverse mortgage is a loan covering that monthly expense.

It may also provide the borrower with a lump sum or monthly payments. Once the borrower leaves the home, the sale of the house is used to repay the reverse mortgage.

One Reverse Mortgage was a national provider from Quicken Loans. Despite being well-rated, the company no longer offers reverse mortgages. We’ll explore what happened to One Reverse Mortgage, plus share competitors to consider for this type of home equity financing. 

Why did One Reverse Mortgage stop offering reverse mortgages? 

One Reverse Mortgage was founded in 2001 and became the nation’s largest reverse mortgage lender. It operated in 47 states and was headquartered in San Diego, California. It primarily focused on jumbo reverse mortgages (up to $4 million) and Federal Housing Administration (FHA)-backed reverse mortgages.

Quicken Loans acquired One Reverse Mortgage in 2008. It offered four types of reverse mortgages that helped seniors lower their monthly expenses while earning income from their equity. 

The company stopped offering reverse mortgages in 2020 because Quicken Loan’s Rocket Mortgage brand grew quickly. The parent company moved the One Reverse Mortgage staff to Rocket Mortgage.

While reverse mortgages have been around in some form since the 1960s, they expanded in the early 2000s as older Baby Boomers reached 62 years old. One Reverse Mortgage grew the business by offering jumbo reverse mortgages to make them more accessible to those not qualifying for FHA reverse mortgages. 

How did One Reverse Mortgage from Quicken Loans work? 

One Reverse Mortgage offered four reverse mortgage products: fixed rate HECMs, adjustable rate HECMs, HECMs for purchase, and the Home Equity Loan Optimizer—all variations of a reverse mortgage, which works like this:

Instead of paying a monthly mortgage, a homeowner with a reverse mortgage (called a home equity conversion mortgage, or HECM, when federally guaranteed) borrows against their home equity from a lender. They can either receive a lump sum of cash, a monthly payment, or a line of credit. 

To be eligible for a reverse mortgage, an applicant must meet the following requirements:

• Be at least 62 years old
• Apply using your principal residence, which must be in good condition
• Have a low (or no) mortgage balance
• No federal debt
• Able to pay for property taxes, insurance, and maintenance
• Complete HUD-approved reverse mortgage counseling

A reverse mortgage is repaid when you leave the home (by either selling or passing away). Typically, the sale of the home covers the cost, or your heirs can repay the lesser of the loan balance or 95% of the appraisal value to keep the home. 

One Reverse Mortgage alternatives 

Despite One Reverse Mortgage’s closing, there are still many reverse mortgage lenders to choose from. Here are three to consider.

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• Two reverse mortgage options
• Program for homeowners aged 55+ and homesharing option
• Dedicated customer service

Finance of America Reverse

Finance of America Reverse (FAR) has many of the same offerings as One Reverse Mortgage, as well as a few unique additions. 

HomeSafe is a jumbo reverse mortgage for loans up to $4 million. HomeSafeSecond is a second mortgage (or home equity loan) that keeps your mortgage payment but provides you with a lump sum using your equity as collateral.

The FHA insures HECM and eliminates your monthly mortgage payment. You can opt to access your equity as a lump sum, monthly cash draw, or line of credit. 

Two unique programs from FAR include:

• EquityAvail: Those who are 55 and older can reduce their monthly payment for 10 years before switching to a full reverse mortgage with no monthly payment. 
• Silvernest Homesharing: Turn empty rooms into ongoing income by getting matched with housemates. 

There are many overlaps compared to the next two reverse mortgage lenders, but FAR does stand out with its EquityAvail and Silvernest Homesharing programs. 

Pros

• Many financing options available

• Direct phone number to a dedicated team member

• EquityAvail provides financial relief for early or pre-retirees

Cons

• No online application 

• Upfront costs include an origination fee

• HomeSafe not available nationwide

Longbridge Financial

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• Three types of reverse mortgages
• Fixed and adjustable rates
• Options for homeowners aged 55+

Longbridge Financial offers three types of reverse mortgages, all similar to One Reverse Mortgage’s former products. 

The first is a traditional, federally-insured HECM reverse mortgage, which allows you to get upfront cash up to 60% of the available proceeds. You can space out monthly payments over time or opt for a line of credit.

Another option is the HECM for purchasing a reverse mortgage, which uses proceeds from your current home to make a down payment of at least 60% on a new home. Instead of taking out a traditional mortgage, you get a reverse mortgage on the property. 

Finally, a Platinum mortgage from Longbridge Financial is for higher-value homes and lowers the minimum age to just 55 instead of the typical 62. The lower age limit offers flexibility and is similar to FAR’s HomeSafe option.

Pros

• Both fixed-rate and adjustable-rate reverse mortgages available

• Reverse mortgage options for 55+

• $500 discount for U.S. military active duty and veterans

Cons

• Fixed rate only available with lump sum disbursement

• Platinum mortgages not available in all states

• No online application; will be contacted after filling out form

Mutual of Omaha

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• Several reverse mortgage options
• Ability to refinance reverse mortgage
• Funds available within three days

Mutual of Omaha‘s reverse mortgages include HECMs, HECMs for purchase, and HomeSafe for higher home values. These are similar to what you can find at other reverse mortgage lenders.

One unique product is Mutual of Omaha’s reverse mortgage refinance loan. You may be able to refinance from an adjustable to a fixed rate or check for other mortgage term improvements. 

There aren’t unique reverse mortgage options like you may find with other lenders, but Mutual of Omaha is a trusted household name, which may be appealing to some applicants. 

Pros

• HomeSafe for higher home values available

• Can refinance your reverse mortgage

• Funds available within three days of closing

Cons

• Must call to start process

• Only available in 48 states

• Fees not listed online

How to apply for a reverse mortgage

1. Talk to a reverse mortgage lender: Most do not offer online applications. Even if you fill out an online form, you’ll likely need to have a phone call to get the application moving. 
2. Complete HUD-approved counseling: Before you apply, you must participate in a counseling session to make sure you understand the reverse mortgage process.
3. Apply for your reverse mortgage: Fill out the lender’s application form. You usually need to include a photo ID and details on your current homeowner’s insurance policy and property tax bill. When both spouses apply as borrowers, it can be easier for the surviving spouse to stay home when one spouse dies. 
4. Get an appraisal: Your lender will order an appraisal to determine your home’s market value. It may also perform a title search to check for liens against the property. 
5. Get approved: The underwriting process involves reviewing your documentation and appraisal to either approve or deny your reverse mortgage.

How do other home equity products compare to a reverse mortgage? 

A reverse mortgage is quite different compared to other types of home equity products because you’re typically eliminating payments instead of adding them. Here’s how other types of home equity financing work.

• HELOC: A home equity line of credit lets you draw from your account as you need funds. You may be able to borrow up to 80% of your home equity. 
• Home equity loan: Also known as a second mortgage, a home equity loan is similar to a traditional HECM in that you get a lump sum upfront. However, you must make monthly payments in addition to your mortgage payment.
• Cash-out refinance: This is a totally new mortgage that lets you cash out some of your existing equity. Your new mortgage balance includes that amount and spreads it out over the new mortgage term.