Details. They can make or break a reverse mortgage professional. One missing item in a loan application can stop the wheels of progress. Incomplete or missing borrower notes can expose us to future liability issues.
Continue readingThe Coming HELOC Crisis & Opportunity
The next mortgage bubble with pending HELOCs written in the mid 2000’s could spell opportunity for reverse mortgage lenders and originators alike. A recent study by TransUnion echoes what some mortgage experts have been warning us of in the last year: there is a coming HELOC bomb that could explode in the coming years.
Continue readingDial Down the Stress
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Not a Stress-Free Life but Stress Management
Stressed? Most of you, reverse mortgage professionals could answer ‘yes’! Many articles, blogs and speakers tell us how to live a quote ‘ stress-free life’. Personally I have never met a soul who lives their days stress-free. I call such a person a ‘unicorn’. They simply don’t exist. What is more realistic are some skills and habits we can develop to better manage and reduce our stress and its impact on our mental state and even our health. Here are few things I have used to manage stress and also am still working to be consistent with to manage stress. 1- Don’t own other people’s problems. I heard one person say ‘it’s better to work on someone else’s problems rather than having your own’. The only issue is each of us has our own pile of problems, issues and challenges. Sure you can lend a listening ear or a shoulder to cry on but don’t take responsibility for someone else’s issues. To do so only enables them to continue their destructive behaviors. 2- Avoid an impoverished mindset. Stress is often triggered when we feel we lack…
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An Ounce of Prevention?
Preventative Measures: Curbing Technical Defaults. An old saying reminds us “ An ounce of prevention is worth a pound of cure.” When it comes to technical defaults for HECM borrowers we may be seeking a cure but there are some preventative measure that can be taken today.
Continue readingThe Seven Habits of Highly Effective Reverse Mortgage Professionals
Effectiveness. It’s a crucial skill in the ever changing landscape of our industry and the increased time and energy required to succeed as an originator.
Continue readingHECM: A Mortgage or Social Program?
Is the federally-insured reverse mortgage a social program or a mortgage loan? The question should be addressed as it goes to the heart of recent program changes, restrictions and requirements. While few argue the HECM program is a social program many often lament that the loan no longer serves the needy, cash-poor or typical borrowers or the past due to principal limit reductions and further loan restrictions.
Continue readingYou only get one chance
Once chance. That’s all you get when it comes to making first impressions with your potential borrowers, outside professionals and others. Having spent numerous years in the field sitting at hundreds of kitchen tables as an originator and financial professional here are a few things I’ve learned or failed at in the past.
Continue readingNavigating Rapid HECM Changes
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The pace of change to the Home Equity Conversion Mortgage (HECM or reverse mortgage) program has rapidly accelerated in recent years. First we had several principal limit factor reductions, the introduction and subsequent removal of the HECM Saver program, the elimination of the Standard HECM products, two-tiered FHA insurance premiums and first year distribution limts. Recently HUD enacted a new policy for Non Borrowing Spouses (NBS) with new PLF tables which goes into effect this August 4th which should be shortly followed by a finalized Financial Assessment measuring a borrower’s financial capacity. How does one keep pace?
First FHA can and will make policy changes quickly as they see fit via mortgagee letter due to their new authority in the Reverse Mortgage Stabilization Act of 2013. The lengthly rule-making process no longer applies allowing for swift and sudden program modifications. Such rapid tweaks to the program can be beneficial in addressing issues as they arise but also create frustration and confusion for both lenders and the consumer alike. One could say the only constant for the HECM program is change itself.
Policy changes may present unique opportunities. For instance, while imperfect, the Non-Borrowing Spouse policy may allow for many to revisit previous loan prospects who walked away due to their concern of the younger spouse being able to remain in the home after the older borrower passes away. It also will garner positive press amongst consumer advocacy groups and financial professionals. Similarily the Financial Assessment while increasing origination efforts and underwriting will be received similarly. Perhaps our industry tagline should read “this is not your grandparent’s reverse mortgage”.
Not suprisingly many of these changes have not been openly embraced by many reverse mortgage professionals. Collectively we want strong consumer protections but not at the expense of further narrowing our potential market with borrowers having to pass through the filter of numerous regulations and underwriting standards. Unfortunately further restrictions seem to arrive during a down market where we can ill afford further reductions in volume. What remains is how we will both prepare and respond in the coming months as these new policies take effect.
How do you anticipate preparing or even leveraging your business in light of these recent changes? What advantages and disadvantages do you anticipate? Please share your ideas in the comment section below.
Non-Borrowing Spouse Policy: A Wrench in the Gears?
What may have gone unnoticed by some may in fact turn out to be one of the most momentous policy decisions in the history of the HECM program: the non-borrowing spouse provision.
Continue readingShifting Your Mental Gears
We can find ourselves stuck in a gear mentally. It could be fear, doubt, unbelief, negativity or anger. So just how can we shift gears mentally to stop feeling bad? Here are a few things I’ve learned in recent years…
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