Longbridge Financial has become a familiar name in the reverse mortgage world. If you’re a homeowner over 62 looking to tap into home equity without selling, you’ve likely seen the company’s ads or heard its name from a financial advisor. But what exactly does Longbridge offer, and how does it compare with other lenders? This guide breaks down the details: products, costs, process, and who it’s really for.
What Longbridge Financial does
Longbridge Financial is a reverse mortgage lender headquartered in Mahwah, New Jersey. Founded in 2010, it has grown into one of the largest reverse mortgage companies in the United States, licensed in all 50 states. Unlike banks that dabble in reverse mortgages, Longbridge focuses exclusively on this niche. That specialization matters because reverse mortgages have complex rules around eligibility, disbursements, and repayment.
The company offers Home Equity Conversion Mortgages (HECMs), which are federally insured through the FHA, as well as proprietary reverse mortgages that aren’t tied to the FHA loan limits. For homeowners with expensive properties, those proprietary options can unlock more equity than a standard HECM.
Reverse mortgage products offered by Longbridge
Longbridge’s lineup falls into three main buckets:
- HECM (Home Equity Conversion Mortgage): The standard reverse mortgage backed by the FHA. Borrowers must be 62 or older, own their home outright or have a small mortgage balance, and complete a counseling session with an independent agency.
- Longbridge Platinum: A proprietary jumbo reverse mortgage for homes valued above the HECM limit. In 2024, the HECM limit is $1,149,825 for most areas. Longbridge Platinum can go higher, with loan amounts based on appraised value.
- Longbridge Liberty: Another proprietary option designed for higher-value homes, often used when borrowers want a lump sum or line of credit without the FHA’s mortgage insurance premium.
Fixed-rate and adjustable-rate versions exist. A fixed rate typically requires you to take all your money at closing as a lump sum. Adjustable rates let you choose a line of credit, monthly payments, or a combination.
How the application process works
The first step is a conversation with a loan advisor. Longbridge will ask about your age, home value, existing mortgage, and how you want to receive funds. If you’re pursuing a HECM, you’ll need to attend counseling with a HUD-approved agency. That session covers the pros and cons, alternatives, and your obligations.
Next comes an appraisal. A licensed appraiser inspects the home and determines its market value. The loan amount depends on the youngest borrower’s age, current interest rates, and the appraised value. After underwriting, you close. If you have an existing mortgage, Longbridge pays it off first, and the remaining equity becomes available to you.
One practical note: reverse mortgage timelines vary. Some close in 30 days, others take 60 or more, especially if the appraisal or title work reveals issues. If you’re weighing a HECM, it helps to understand recent market shifts, like the March HECM bump that masked a deeper slowdown, because lender volume and rate changes can affect how quickly your application moves.
Costs and fees to expect
Reverse mortgages aren’t cheap. Longbridge, like other lenders, charges an origination fee, closing costs, and for HECMs, an upfront mortgage insurance premium (MIP). The upfront MIP is 2% of the home’s appraised value or the maximum claim amount, whichever is less. You’ll also pay an annual MIP of 0.5% of the outstanding loan balance.
Other costs include:
- Appraisal fee: usually $500 to $800
- Title search and insurance: varies by state, often $1,000 or more
- Recording fees and taxes: a few hundred dollars
- Servicing fee: $30 to $35 per month for HECMs, sometimes waived on proprietary loans
You can finance these costs into the loan, which means you won’t pay them out of pocket. But that reduces the net proceeds available to you. Ask Longbridge for a detailed Loan Estimate and compare it with at least two other lenders.
Who a Longbridge reverse mortgage makes sense for
Reverse mortgages fit a specific set of circumstances. You might benefit if you’re 62 or older, have significant home equity, and want to stay in your home long-term. They can provide tax-free cash flow (though you should confirm with a tax professional), eliminate monthly mortgage payments, and create a line of credit that grows over time.
Longbridge’s proprietary products are particularly relevant for homeowners with properties worth more than the HECM limit. If your home is valued at $2 million, a standard HECM caps your borrowing at the limit. A jumbo reverse mortgage can access more of that equity.
That said, a reverse mortgage isn’t right for everyone. If you plan to move within a few years, the upfront costs may outweigh the benefits. If you want to leave your home to heirs without debt, a reverse mortgage complicates that plan, though heirs can sell the home to repay the loan.
Potential drawbacks and alternatives
The biggest drawback is cost. Upfront fees can run $10,000 or more on a $500,000 home. The loan balance also grows over time because interest and MIP accrue. After 10 years, you might owe significantly more than you borrowed.
Alternatives worth considering:
- Cash-out refinance: Replace your mortgage with a larger one and take the difference in cash. You’ll have a monthly payment, but costs are often lower and you keep full ownership without accruing debt.
- Home equity line of credit (HELOC): A revolving credit line with lower upfront costs. Payments are usually interest-only during the draw period, but the lender can freeze or reduce the line.
- Downsizing: Sell the home, buy something smaller, and pocket the difference. No loan, no accruing debt.
- Refinancing an existing reverse mortgage: If you already have a HECM and rates have dropped, a refi might reduce costs, but you’ll pay new closing costs.
Longbridge doesn’t offer these alternatives directly, so it’s worth talking to a financial advisor who understands reverse mortgages. Some advisors specialize in them; others don’t.
Questions to ask before choosing Longbridge
Before you sign, get clear answers on these points:
- What’s the total cost, including origination, closing, and MIP?
- Is the rate fixed or adjustable? If adjustable, what index does it follow and how often can it change?
- How do I receive my money: lump sum, monthly payments, line of credit, or a mix?
- What happens if I move out for more than 12 months, or if I fail to pay property taxes and insurance?
- Can I make partial repayments without penalty?
- How does Longbridge service the loan after closing?
Longbridge has a decent reputation, with an A+ rating from the Better Business Bureau and a strong focus on customer education. But reputation alone shouldn’t seal the deal. Reverse mortgage rates and fees vary by lender, and even a small difference in rate can mean thousands of dollars over the life of the loan. Get quotes from at least three lenders, including a local credit union or bank that offers HECMs. Read the fine print. Ask for the amortization schedule. Then decide whether a reverse mortgage (or a different path) best fits your retirement.