An 81-year old reverse borrower could have avoided foreclosure…

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Why Longbridge Financial’s acquisition is a plus for the industry

Ellington Financial acquired a majority interest of Longbridge Financial, a move many say is a positive sign for the reverse mortgage industry.

Other Stories:

  • An 81-year old reverse borrower could have avoided foreclosure had Texas launched a foreclosure relief program sooner

  • In a potential boost for defense, former Live Well CEO’s former defense attorney’s law license suspended

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Don Opeka March 9, 2022 at 6:13 am

E698 Suzie Orman seems to think that just because someone has a Reverse Mortgage they must spend the money. I have a HECM that we took out in 2017 with an $800 balance today. People often overlook the fact that anyone can make payments on a HECM, in any amount at any time. This means a person can originate a HECM at age 62 and make payments just like on any other mortgage. If it’s an adjustable rate product, the payments increase the line of credit. In case of job loss, health issues, or COVID, there is no need for forbearance. Borrower can stop making payments or draw on the line to get through a financial pothole then go back to making payments later. I have plenty of stories concerning how a borrower can benefit from a HECM at any age. Suzie simply makes the assumption that the person choosing a HECM is a bad financial manager. I would challenge that assumption. There are plenty of reasons for good money managers to have a HECM at any age. The leaders of our industry simply refuse to tell the good stories.

Shannon Hicks March 9, 2022 at 10:28 am

Excellent first-hand description of how incredibly flexible a HECM loan can be when used judiciously.

The Cynic March 14, 2022 at 8:39 am


I am a little lost how Incurring upfront costs and then paying them off except $800 was good cash management. What did you get from incurring that cost and then paying off most of it —- other than decreased cash flow? The pay down may show that Suze is not right but was that worth the monetary cost? It certainly did not increase your personal cash flow or net estate (or net worth).

If your home is now worth over $970,800, your 2017 origination seems a little premature with the low growth rates of the last five years related to the HECM line of credit; however, there may have been something else at play especially if your mandatory obligations were less than 50% and your case number was assigned before 10/2/2017. If that were the scenario, your upfront MIP was just 0.5% and you got higher principal limit factors than are available today. The one offset is that your ongoing MIP is 1.25%, making your pay down of UPB at closing a little more understandable and palatable.

So what are your facts?

RM Advisor March 9, 2022 at 10:25 am

Does anyone remember when WIMC (Walter Investment Management Corporation) acquired RMS and then Security One less than a decade ago? It seems memories can be very selective. That deal was a flop and cost WIMC north of $120 million although the actual loss was probably somewhat lower. Or who remembers B of A’s acquisition of Seattle Mortgage’s reverse division for over $200 million. B of A took the loss rather selling its reverse operations to someone else.

Our history with sales of turn key operations is spotty at best and there are other acquisition failures but that is for another comment.

As P. T. Barnum was famous for saying: “A ______ is born every minute.” We can only wish this is not the case in this instance.


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