American Senior Lending, a dba of HighTechLending (HTL), is positioning its new home equity line of credit (HELOC) as a credit card-like tool for seniors — particularly those who don’t qualify for traditional revolving credit.
The product, called EquitySelect, debuted in September as a first-lien HELOC that allows borrowers to set monthly payments as low as 1% of their annualized loan balance and also a cap. Any unpaid interest is added to the loan balance, which is ultimately settled when the home is sold or through a final balloon payment that will not exceed the property’s value.
The loan carries a 40-year term and requires borrowers to draw at least 50% of the credit line — or $75,000, whichever is higher — during a seven-year draw period. There is no recast of payments for the life of the loan.
CEO and president David Peskin — who previously held leadership roles at Senior Lending Network and Reverse Mortgage Funding (RMF) before purchasing a stake in HTL in early 2024 — helped to design the product.
“People want to make payments like a credit card, but there are no products out there that are really custom-designed for older homeowners to access the equity and make a payment that’s comfortable for them,” Peskin said in an interview with HousingWire’s Reverse Mortgage Daily.
“This product allows them to make home improvements, pay off debt, help grandkids or whatever they want. With taxes and insurance rising, it helps cover that as well. It’s a piece of the puzzle that was missing for us.”
Digging into the underwriting
EquitySelect targets retirees or soon-to-be retirees seeking to manage cash flow and remain in their homes without resorting to high-interest credit cards or interest-only, shorter term HELOCs. It may also serve borrowers who struggle to qualify for bank financing due to higher debt-to-income ratios.
“If you have a good asset to put a lien against, you’re less concerned about cash flows. You obviously want cash flows, so we designed the loan to value based on the age of the borrower and their life expectancy,” Peskin explained.
“The longer you’re expected to live, the lower the loan to value is going to be, in case you make that minimum payment over the full duration of the loan. And the older you are, the higher the loan to value.”
This is not an off-the-shelf product. It’s tailored to each borrower’s income, home equity and age. A full appraisal is required, which can take weeks. The company is currently offering the loan primarily through its wholesale channel and is also exploring partnerships with smaller banks and credit unions.
EquitySelect is currently available in Arizona, California, Colorado, Florida, New Jersey, Oregon and Utah, with six or seven additional states expected by the end of 2025. A second-lien version is slated for release in January to accommodate homeowners who want to keep their low-rate first mortgage intact.
Burgeoning potential
HTL sees significant opportunity for the aging-in-place demographic — a segment with an estimated $14.4 trillion in home equity that’s also combating rising living expenses, from health care to insurance and repairs. Borrowers are primarily using the HELOC for debt consolidation, home improvement and additional cash flow to cover housing and medical costs.
“There are 40 million-plus older homeowners out there but so few products that are really designed to help people age in place,” Peskin said.
Production to date totals “several million,” but the goal is to scale to well over $100 million per month. “We think the market is in the billions on an annualized basis,” he added.
The product is being funded through both HTL’s balance sheet and institutional investors — support that Peskin said was held back until technology and regulatory infrastructure were in place. “It took us two years to develop the product, both from a legal standpoint as well as the technology and how to offer it,” he said.
Looking ahead, HTL plans to partner with financial advisers and insurance agents who want to help seniors finance their long-term care needs.
