BNY Mellon to Launch Home Equity Retirement Solutions

Program Designed for Integration into Retirement Portfolio Planning

Jun 13, 2014, 07:36 ET from BNY Mellon

NEW YORK, June 13, 2014 /PRNewswire/ -- BNY Mellon, a global leader in investment management and investment services, plans to launch Home Equity Retirement Solutions later this year, a business that purchases, securitizes and services reverse mortgages and provides advisory services to brokers, financial advisors, and asset managers on how reverse mortgages fit into retirement plans.

The program will be designed to provide U.S. retirees with cash to supplement their retirement plans and help them achieve sustainable home ownership throughout their retirement. 

"Many retirees face a significant financial shortfall," said Michael Gordon, managing director of non-traditional solutions and special situations for BNY Mellon Investment Management.  "We view the funds generated by suitable reverse mortgages as an additional fixed income component of retirement portfolios, an important part of retirement planning that complements other aspects of the plan."

Gordon noted BNY Mellon has a long track record of working with retirees including managing assets for 401K and defined benefit investments.  He added, "We expect that a number of new approaches, including reverse mortgages, will be required to help retirees achieve their financial goals due to the severe underfunding in many people's retirement plans."

These types of mortgages may now be more prudent based on the financial circumstances of an individual homeowner, according to Gordon.  Several actions over the past couple of years, notably the passage of the 2013 Reverse Mortgage Stabilization Act and subsequent mortgagee letters issued by the U.S. Department of Housing and Urban Development, allow lenders to underwrite mortgages, enabling lenders to provide reverse mortgage loans only to those consumers that meet appropriate suitability standards. 

BNY Mellon is designing a rigorous suitability survey for use by intermediaries, outlining a socially responsible lending approach. The consumer loans and advisory services are expected to be offered through a variety of distribution parties, including brokers and fee-based advisors.  "It is extremely important that all parties take a socially responsible approach to these mortgages," said Gordon.

"Leveraging home equity for income can enhance both diversification and projected financial outcomes," said Gordon.  "With a top 10 position in the U.S. retirement market, and as one of the largest investment management companies, with a growing menu of alternative asset management offerings, BNY Mellon is able to offer Home Equity Retirement Solutions as a natural business extension while helping to improve U.S. retiree portfolio diversification overall."*

As part of its focus on retirement, BNY Mellon will work with loan originators to provide the tools and intellectual capital that will enable them to present home equity retirement solutions to home owners in a manner that enhances retirement outcomes and reduces their risk.  Once originators close their loans, BNY Mellon will re-underwrite every loan to determine if they are suitable for BNY Mellon's securitization process.  BNY Mellon will purchase and securitize loans that are suitable. 

*Top 10 – US – Defined Contribution Investment Only (The Cerulli Report, Retirement Markets 2013)
Notes to Editors:

BNY Mellon Investment Management is one of the world's leading investment management organizations and one of the top U.S. wealth managers, with $1.6 trillion in assets under management.  It encompasses BNY Mellon's affiliated investment management firms, wealth management services and global distribution companies.  More information can be found at

BNY Mellon is a global investments company dedicated to helping its clients manage and service their financial assets throughout the investment lifecycle.  Whether providing financial services for institutions, corporations or individual investors, BNY Mellon delivers informed investment management and investment services in 35 countries and more than 100 markets.  As of March 31, 2014, BNY Mellon had $27.9 trillion in assets under custody and/or administration, and $1.6 trillion in assets under management.  BNY Mellon can act as a single point of contact for clients looking to create, trade, hold, manage, service, distribute or restructure investments.  BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation (NYSE: BK).  Additional information is available on, or follow us on Twitter @BNYMellon.

All information source BNY Mellon as of March 31, 2014.  This press release is qualified for issuance in the US only and is for information purposes only. It does not constitute an offer or solicitation of securities or investment services or an endorsement thereof in any jurisdiction or in any circumstance in which such offer or solicitation is unlawful or not authorized.  This press release is issued by BNY Mellon Investment Management to members of the financial press and media and the information contained herein should not be construed as investment advice.  Past performance is not a guide to future performance.  A BNY Mellon Company.          


Mike Dunn

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