HECM Changes: 5 Things to Expect

by Shannon Hicks
| 4 Comments
| October 6, 2017

HECM Changes & the Ensuing Crash in Volume

Today marks one week after HUD enacted yet another reform of the Home Equity Conversion Mortgage. While it’s still too early to tell, what lasting impacts can we expect as a results of these changes?

While the mortgagee letter was rather pithy, the potential impacts are considerable. Here are some impacts to anticipate and plan for in the wake of the most recent overhaul of the federally-insured reverse mortgage.

Fewer qualified borrowers with high mortgage balances. Just as rising interest rates squeeze out homebuyers requiring higher down payments and monthly installments, HUD’s lending ratio and floor reductions will preclude a significant percentage of those seeking to eliminate their monthly mortgage burden.

Opportunities for smaller lenders and brokers. The resulting push to compete on loan margins will reduce the money available for marketing… Download the video transcript here.

Editor in Chief: HECMWorld.com

As a prominent commentator and Editor in Chief at HECMWorld.com, Shannon Hicks has played a pivotal role in reshaping the conversation around reverse mortgages. His unique perspectives and deep understanding of the industry have not only educated countless readers but has also contributed to introducing practical strategies utilizing housing wealth with a reverse mortgage.

Shannon’s journey into the world of reverse mortgages began in 2002 as an originator and his prior work in the financial services industry. Shannon has been covering reverse mortgage news stories since 2008 when he launched the podcast HECMWorld Weekly. Later, in 2010 he began producing the weekly video series The Industry Leader Update and Friday’s Food for Thought.

Readers wishing to submit stories or interview requests can reach our team at: info@hecmworld.com.

4 Comments

Larry Brooks
October 10, 2017 at 5:20 am
Is any organization working to try to get these changes reversed?
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- The_Cynic
  October 13, 2017 at 11:36 am
  Larry,
  
  Why? What do you believe should replace them?
  
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robin
October 10, 2017 at 5:30 pm
Too late for that. We had our say after 8/14.
The secondary market might try to do something. I see a non-fha reverse mortgage. Just getting rid of HUD and FHA might help.
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- The_Cynic
  October 13, 2017 at 11:38 am
  Robin,
  
  Your suggestions are ridiculous.
  
  As to non-FHA reverse mortgages, I cannot tell you how many seniors I had to call to tell them that their application was being denied due to the proprietary product lender stopping their reverse mortgage lending.
  
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