You may not be originating traditional or forward mortgages as HECM professionals are prone to call them but the impacts of skyrocketing mortgage rates and a fragile housing market on reverse mortgage lenders cannot be denied. 

Today homebuyer demand has been effectively squashed with the average 30-year mortgage rate more than doubling since the beginning of the year. Consequently, home sale prices are rapidly falling in several markets across the country. Closer to home, the 10-year Constant Maturity Treasury (CMT), which along with the lender’s margin determines how much money a homeowner may qualify for in a Home Equity Conversion Mortgage (HECM) loan, has skyrocketed from .54% in early March 2020 to 4.17% on Friday, November 4th. 

All this leads to the question, how can an originator increase their odds of survival in an abysmal market? 

Here are some survival tips curated from some of the nation’s top traditional and reverse mortgage producers. 

1. Increase your prospecting activity. Higher rates and lower home values mean fewer homeowners will qualify. Increase your odds by increasing your outbound sales efforts. The more outbound contacts, the more potential qualified leads you’ll generate.
2. Consider focusing your efforts on markets where home sale prices are not dropping considerably. Choosing markets with fairly stable or moderate declines in the median home price may reduce the number of homeowners ‘short to close’. One tool you can use can be found on Redfin’s Data Center. 
3. Renew or start network marketing in earnest. If you’ve never built a network of professionals who cross paths with older homeowners now’s the time to start. If you’ve neglected your interactions with other service providers in your market schedule regular phone calls, prospecting, and meetings with area experts. Many of their clients are feeling the pain of inflation or investment losses and they need solutions.
4. Consider holding public workshops. Get creative and incorporate inflation and home equity into a compelling public presentation. As always, get compliance approval before advertising or hosting an event. 
5. Call your previous borrowers. Ask how they’re doing, if there’s anything you can help them with, and if they can recommend a friend or family member who could benefit from tapping into their home’s value with no required monthly mortgage payments. 
6. The HECM as a HELOC alternative. Besides higher interest rates more are finding that qualifying for a home equity loan has become difficult with banks tightening their credit standards. Homeowners with substantial equity could benefit by taking a HECM line of credit, which, unlike a bank HELOC, cannot be frozen or reduced merely because of falling home values.

There’s no silver bullet for an ugly market, but there are certainly some strategies that may help you endure, survive, or even grow. 

What tips would you add for reverse mortgage professionals to increase their odds of surviving today’s housing and mortgage market? Share your ideas in the comment section below.