March 7, 2006
Leading Reverse Mortgage Lender Records Fifth Consecutive Year
FOR IMMEDIATE RELEASE
Contact:
Frank Piemonte
River Communications
914.686.5599
fpiemonte@riverinc.com
Leading Reverse Mortgage Lender Records Fifth Consecutive Year of Record Loan Originations in 2005
Irvine, Calif., (March 7, 2006) – Financial Freedom, a subsidiary of IndyMac Bank F.S.B. (Indymac Bank®), and the nation's largest lender of reverse mortgages, today announced that 2005 was its fifth consecutive year for a record number of reverse mortgage loan fundings and applications. Last year, Financial Freedom closed 30,991 loans, representing a 56 percent increase over 19,817 in 2004.
"The number of loans closed this year clearly demonstrates the increasing consumer understanding and appreciation of reverse mortgages as an answer to a wide range of seniors' financial needs," said Jim Mahoney, CEO of Financial Freedom. "In each of the last five years, we have increased our year-over-year production of reverse mortgages. This consistent growth, combined with a corresponding spike in interest from various financial professionals—mortgage brokers, bank reps, and financial planners—in providing these products to their customers, demonstrates that reverse mortgages are becoming a mainstream product. This increased interest from consumers and professionals alike will continue to drive the growth of the reverse mortgage industry."
The most dramatic increase occurred in volume dollars. In 2005, Financial Freedom closed $2.9 billion in loans, compared with $1.6 billion in the same period ending December 31, 2004. This represents an 81 percent increase, which indicates that in addition to closing more loans, the average home value per loan has increased as well.
Financial Freedom's loan volume is comprised mainly of two types of loans: FHA's Home Equity Conversion Mortgage or (HECM), the predominant reverse mortgage product in the marketplace; and the Financial Freedom Cash Account, which is the only jumbo reverse mortgage available and designed for homes in excess of $450,000 in value.
Reverse Mortgages Explained
Reverse mortgages enable senior homeowners 62 or older to convert part of the equity in their home into tax-free income without having to sell the home, give up title, or take on a new monthly mortgage payment. Borrowers will never, under any circumstances resulting from the reverse mortgage, be forced to leave their homes, provided they make their real estate property tax and insurance payments.
Borrowers can choose to receive the reverse mortgage funds as a lump sum, monthly income (for up to life), or line of credit, or any combination of these options. Borrowers can use the funds anyway they wish and they make no monthly payments on a reverse mortgage during the life of the loan. The loan becomes repayable when the borrower sells the home or permanently moves out. In addition, the repayment amount can't exceed the value of the home.
Insured by the federal government through the Federal Housing Administration, an arm of the Department of Housing and Urban Development, the Home Equity Conversion Mortgage or HECM, is the predominant reverse mortgage product in the marketplace. Financial Freedom also provides the only jumbo reverse mortgages, the Cash Account, Zero Point Cash Account and Simply Zero Cash Account, which are designed for homes in excess of $450,000 in value.
About Financial Freedom
Financial Freedom Senior Funding Corporation, a subsidiary of IndyMac Bank, F.S.B., based in Irvine, California, is the largest originator of reverse mortgages in the United States. Financial Freedom originated over $2.9 billion in loan fundings on $9.1 billion in home value in reverse mortgages in 2005 and is now the largest servicer of reverse mortgages with a servicing portfolio of approximately 77,000 loans.
Financial Freedom is a founding member of the National Reverse Mortgage Lenders Association. NRMLA is a nonprofit trade association, based in Washington, DC, whose mission is to support the continued evolution of reverse mortgages as an important financial option for senior homeowners while educating both its members and consumers about the varied applications of this unique loan. For more information, visit the Financial Freedom Web site at www.financialfreedom.com.
Members sign a Code of Conduct pledging to abide by guidelines that assure fair, ethical, and respectful practices in offering and making reverse mortgages to seniors. For more information, visit the NRMLA Web site at www.reversemortgage.org.
®2005 Registered trade/service marks are property of Financial Freedom Senior Funding Corporation, A Subsidiary of Indymac Bank, F.S.B .
©2005 Financial Freedom Senior Funding Corporation
About IndyMac Bancorp
IndyMac Bancorp, Inc. (NYSE: NDE) (Indymac®), is the holding company for IndyMac Bank F.S.B. (Indymac Bank®), the largest savings and loan in Los Angeles County and the ninth largest mortgage originator in the nation. Indymac Bank, operating as a hybrid thrift/mortgage banker, is in the business of utilizing the secondary market to design, market, and manufacture cost-efficient financing for the acquisition, development and improvement of single-family homes and other banking products to facilitate consumers' personal financial goals and opportunistically invests in and trades single-family lending related assets.
With this exclusive and disciplined focus on home financing, Indymac expects to out-execute its peers and become the preeminent provider of such products in the USA. Indymac's total annualized return to shareholders of 23 percent for the period 1993 through Feb. 28, 2006, under its current management team, has exceeded the comparable returns of 12 percent and 11 percent for the Dow Jones Industrial Average and S&P 500, respectively, over the same period.
For more information about Indymac and its affiliates, or to subscribe to Indymac's Email Alert feature for notification of Indymac news and events, please visit our Website at www.indymacbank.com.
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