Lenders are expecting the Baby Boomer generation to borrow money with reverse mortgage loans that allow them to cash in on their home equity.
According to the Mortgage Bankers Association, a survey of 110 mortgage banking companies found that demand for reverse mortgages rose 28 percent in the first six months of 2005 from the second half of 2004.
"Reverse mortgages will be a growing product," said Ray Morris, director of business development at GMAC Mortgage Corp. "Baby Boomers will opt for the reverse mortgages. Sold to the right people, it is a great product."
Lenders also said they expect to increase efforts to lend to minorities and America's growing immigrant population.
"If you look at demographics, those are working in our favor. We have a fairly high-growth population," said Bill Beckmann, president and chief operating officer at CitiMortgage, a unit of Citigroup.
Source: The Journal News, November 5, 2005 www.thejournalnews.com