Lately there have been several media accounts stating that much confusion remains for HECM borrowers. I have to admit I have some healthy skepticism when the media claims that reverse mortgages are still confusing for borrowers especially since the Home Equity Conversion Mortgage mandates counseling to cover the basic mechanics of the loan.
Continue readingThe Origin of the Financial Assessment?
The Home Equity Conversion Mortgage has undergone numerous product changes, regulations, new counseling requirements and protocols and reductions to lending ratios. Much like an aging celebrity who has undergone one too many plastic surgeries one may be left wondering does the new HECM even resemble the original product?
Continue readingNot Surprised
The media is inaccurate, misleading and selective in reporting the facts? What’s new. The Consumer Financial Protection Bureau’s recent release of it’s report on reverse mortgage complaints was seized upon by both the media and so-called consumer advocate groups. Surprised? No. Damaging? Possibly.
Continue readingA Welcomed Delay
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Delay Grants More Time to Prepare for Assessment
Last week our industry received what many consider an early Valentines gift. Feel the love yet? HUD announced that they would be delaying implementation of the financial assessment which was slated to be in force March 2nd, 2015. The agency states a new effective date can be expected within 30 to 60 days. After numerous delays of the assessment I’m certain many of you watching are raising an eyebrow. Regardless of the nervous and jerky nature of the assessment we can seize upon five benefits of HUD’s postponement.
1- The opportunity to get more borrowers through the gate. Your prospects who are undecided may wish to act now for a more streamlined and less restrictive loan approval process. Our goal is not to instill fear but rather to give them the choice: act now or wait and go through the assessment. We should focus on borrowers who may require a substantial lifetime expectancy set aside who would see more proceeds prior to the assessment.
2- Time to adjust your marketing plan. We should all be asking ourselves ‘am I attracting the right type of borrower?’ Look at your marketing, lead sources and referral network and determine the typical borrower profile that each provides. If you’re presently marketing to areas with low…
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Parsing Words
As industry watchdog and consumer advocate Atare Agbamu puts it “Fourteen words”. At the heart of the non-borrowing spouse debate and subsequent lawsuits brought agains HUD are fourteen words found in the original regulations of the HECM program as part of the National Housing Act in subsection J entitled “Safeguard to prevent displacement of homeowner”
Continue reading3 Weeks: Are You Prepared?
When it comes to how reverse mortgage loans are originated a line has been drawn in the sand: March 2nd, 2015. In two short weeks the long-awaited or dreaded Financial Assessment goes into effect forever changing the way HECM loans are qualified. This is a game-changer.
Continue readingM.O.E. An Alternative to HECM Foreclosures
This monumental policy change comes in the wake of several notable lawsuits brought against the Federal Housing Administration (FHA) and reflects the agency’s desire to close the door on further displacement of younger non-borrowing spouses. Let me begin by saying that this policy is somewhat complex and we will only be covering the primary guidelines of this new policy.
Continue readingAssessing the Impact
The two biggest words in our industry today…Financial Assessment. The question is what fallout can we anticipate once the assessment goes into effect in March? A recent article in Reverse Mortgage Daily looks at the potential impact finding both optimistic and pessimistic predictions.
Continue readingA New Type of Non-Borrowing Spouse
We had mentioned in an earlier episode that we expected to see HUD bring futher clarification to the new Non Borrowing Spouse policy. Last week however we have a new twist. The Ineligible Non-Borrowing Spouse.
Continue readingWhat Does 2015 Hold for Us?
“My best predictions are always for the past” one said and I couldn’t agree more. I am hesitant when it comes to predictions but here are a few we will venture to make for 2015.
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