The harsh realities in our industry and hope can both coexist. Here’s why…
Continue readingHarsh Reality & Hope Can Coexist
Facebook’s system enabled discrimination for housing ads
When does targeted demographic marketing become discriminatory? Earlier this month the Department of Housing and Urban Development filed a formal complaint against the social media giant Facebook, accusing them of allowing companies to exclude certain groups
Continue readingWhen is Targeted Marketing Discriminatory?
When does targeted demographic marketing become discriminatory? Earlier this month the Department of Housing and Urban Development filed a formal complaint against the social media giant Facebook, accusing them of allowing companies to exclude certain groups
Continue readingUncharted Territory
Blind Faith or Measured Optimism?
If you’ve been wondering out loud just how our industry can position itself to begin regaining some of its historic numbers, you’re not alone. After reflecting on recent predictions as to just where reverse mortgage volume is expected to go, and reviewing our most recent case number assignments issued in the month of June, it’s safe to say that we have entered uncharted territory. While consumers are repeatedly advised to shop around for the best deal, the truth remains that significant changes to the reverse mortgage have reshaped the landscape of a loan that once appealed to and met the needs of a significant portion of middle and lower-middle-class seniors.
Narrow is the way that leads to today’s senior qualifying for a reverse mortgage, and fewer qualify for it. It’s not so much a lack of collective consumer demand- as today more retirees are seeking ways fund their non-working years- it’s a matter of fewer homeowners being able to successfully navigate an increasingly complex path to secure the loan.
Before you make any final judgments about our future consider the…
Filling the Gap: This week’s HECM news
Private reverse mortgages are filling the HECM gap. Australia opens the doors for reverse mortgages. Are we entering another housing bubble?
Continue readingHECM Fixes, Outlook & Risk Management
Industry leaders are weighing on with their proposed fixes, outlook, and risk management ideas…
Continue readingAsking the Right Questions: Structuring a Loan
This week we continue with our conclusion of how to structure HECM loans with our special guest Sharon Falvey of Harbor View Consulting.
Continue readingStructuring a HECM Loan
Often overlooked loan structuring is key for HECM borrowers
The following commentary does not represent the official position of Reverse Focus, Inc.
It seems much of our industry’s news cycle, including here, is focused on recent or even anticipated changes to the Home Equity Conversion Mortgage. However there has been little discussion of the importance of structuring a reverse mortgage to meet the goals of the borrower.
FHA Commish speaks out on HECM Fix
FHA Commissioner doing ‘deep dive’ to isolate source of HECM losses
The following commentary does not represent the official position of Reverse Focus, Inc.
Last October just days after the agency enacted substantial cutbacks to the Home Equity Conversion Mortgage, HUD Secretary Ben Carson spoke before the House of Representatives saying “the changes we’ve made will sort of stop the bleeding in terms of new reverse mortgages”. However, despite rising home values, numerous program tweaks and lending ratio reductions the program continues to raise concerns among lawmakers who see increasing liabilities in FHA’s Mutual Mortgage Insurance Fund.
FHA Commissioner Brian Montgomery addressed this challenge in a recent interview with Reverse Mortgage Daily “We are digging deep in the portfolio to find out of the problem is on the front end or the back end,. My sense is that it’s more on the back end in terms of the losses we are experiencing.” Commissioner Montgomery is rightfully concerned that many of the HECM program’s ‘losses’ may be on the back end since HECM liabilities continue to mount even after the enactment of the financial assessment, principal limit or lending ratio reductions, and first-year distribution limits.
One area that FHA intends to closely examine is the appraisal process- more specifically to see if home values are being artificially inflated. The concern is heightened since properties with a HECM tend to depreciate more quickly than homes with traditional mortgages, said Montgomery. FHA will be comparing existing appraisals with AVM
Download the video transcript here
HECM declines: A new approach needed
Fees, lending ratios (PLFs), and market growth
The following commentary does not represent the official position of Reverse Focus, Inc.
You don’t have to the read industry blogs to know that reverse mortgage volumes are in retreat, not only from the historic levels, but even from the previous year. Recent data shows current 2018 HECM endorsements are down 13% from the previous year. As reported here, last month Reverse Market Insight saw signs of a potential leveling off of market volume with May HECM endorsements nearly identical to April. However many originators in the field remain challenged in the post-October 2nd world of originating HECMs. HECM professionals are finding that many interested homeowners no longer qualify due to the last round of lending ratio or principal limit factor reductions enacted last Fall.
However, some HECM lenders and originators have bucked the attrition in loan volume posting gains in 2018. They key? Specialization
