Holiday Weekend Round-Up: H4P Resources, RMF’s New Ad

Stories about the industry’s reaction to the changing reverse mortgage consumer captured RMD readers’ attention this week, with an all-in-one guide to HECM for purchase leading a pack that also included an analysis of Reverse Mortgage Funding’s new pitch to potential borrowers and a look at how originators have won over financial advisors with pure data.
7 Must-Read Reverse Mortgage for Purchase Resources — RMD compiled a list of seven articles about the under-the-radar home equity conversion mortgage for purchase (H4P) transaction, in which borrowers use a HECM to buy a second property. RMD’s list includes breakdowns from such varied outlets as Seeking Alpha, About.com, and the Denver Post — all in one easily sharable place for clients and mortgage professionals alike.
RMF Uses “Unconventional” Message to Reach New Audience — Executives at Reverse Mortgage Funding noticed that consumers in focus groups were consistently skeptical of ads that promoted the HECM “no-payment” option. So they created a new spot that downplays that aspect in favor of a “flexible payment” approach, which RMF says has been getting a positive reception from viewers.
Lenders Adapt Approach to “New” Reverse Mortgage Borrower — RMD explored how lenders are working to hone their messages to borrowers that plan to use HECMs as a part of their retirement portfolios, and not to meet immediate financial needs — while they tend to be more informed than the needs-based borrowers of years past, they can also sometimes be harder to convince.
Data Key to Financial Planners’ Reverse Mortgage Perceptions — A financial planner who once thought HECMs were only loans of last resort learned to discuss them with clients the same way that he was convinced to change his perception: the presentation of cold, hard numbers.
Reverse Mortgages Around the Web
Reverse Mortgage Nightmare — Long on all-caps words and short on details, Mobile, Ala. NBC affiliate WPMI shows that news organizations still use the phrase “reverse mortgage” to scare the public into tuning in.
ReverseVision’s Birdsell Honored — Jeff Birdsell, vice president of professional services at the San Diego, Calif-based software provider ReverseVision, was named as one of Mortgage Professional America magazine’s Hot 100 for 2017. Birdsell has been developing mortgage-origination software since the 1990s, and is a founding member of the National Reverse Mortgage Lenders Association.
And finally, a reminder that RMD’s offices will be closed for the Presidents Day holiday on Monday. We hope you enjoy your long weekend, and our daily coverage resumes on Tuesday.
Written by Alex Spanko


Second Annual ReverseVision Event Attracts New Reverse Mortgage Blood

Mortgage professionals new to the industry are exploring the ins and outs of reverse mortgages, as shown through the attendance at a growing industry event held in San Diego last week.
A year following its inaugural UserCon in January 2016, reverse mortgage industry software provider ReverseVision held its second annual conference last week, drawing a larger attendance than its first and many new players in to the industry.
“Our goal was to up the game,” says Wendy Peel, vice president of sales and marketing for ReverseVision. “Let’s bring in the new blood and treat this product the way it deserves to be treated—as a smart wealth management and retirement planning tool.”
The event, which took place in San Diego for the second year, was capped at 200 registrants and sold out its full capacity. But a key distinction,  ReverseVision leadership realized, was the number of new participants who are beginning to explore bringing reverse mortgage offerings to their existing business versus existing ReverseVision users.
A kickoff “HECM facts track” session open only to new originators and lenders drew 93 attendees—far exceeding expectations. Among the new participants, ReverseVision found roughy half are looking at the reverse mortgage from the corporate level, and the other half are currently originating forward mortgages and have done a small handful of reverse mortgage loans in the past.
“A small percentage were people who might have done a few reverse mortgages in the past and are now needing a refresher because they want to ramp up again,” says Kelly Kelleher, ReverseVision director of corporate marketing and events.
The the event is among several other company initiatives to bring new entrants to the reverse mortgage space and help educate new and existing originators and lenders. In recent years, ReverseVision has rolled out RV University as a training ground comprising online courses on topics from reverse mortgage basics to learning the ins and outs of new non-borrowing spouse rules. The company is also launching a monthly live training course next month; has participated in “forward” mortgage events such as as the American Bankers Association annual conference, and the Mortgage Bankers Association’s annual conference; and last year launched a reverse mortgage sales tool, RV Sales Accelerator (RVSA), that combines three areas: contact management, advanced calculators to demonstrate scenarios for financial selling and sales knowledge.
The goal is to inform new participants and to gain their investment in the HECM product to help them grow their business, Peel says.
“When you invest a little time and money into something, you see the opportunities you hadn’t seen before,” she says of new industry participants. “We should see an increase in industry loan volume specifically from the people at our conference.”
The positive reception among industry players new and old for the last two years has prompted ReverseVision to start the planning stages for its 2018 UserCon, again in February in San Diego. While the details have yet to be released, one theme on the agenda will be the HECM for Purchase (H4P). There is some anticipated expansion in terms of attendance, but the conference again will be capped in terms of number of attendees.
“Register early,” Peel says.
Written by Elizabeth Ecker


Maine Gov. Touts Reverse Mortgages in New Legislation

Reverse mortgages could become a central part of Maine’s foreclosure law if the governor has his way.
Under new legislation proposed by Gov. Paul LePage, a Republican, any town considering foreclosure on a home due to unpaid taxes would have to first inform the residents of several potential relief options, including a home equity conversion mortgage, tax abatements, or a lien in which the town takes ownership of the property until the residents die, according to the Morning Sentinel of Waterville, Maine.
LePage’s concerns about foreclosures on elderly and lower-income Mainers intensified after he learned about the story of Richard and Leonette Sukeforth, two 80-year-olds who lost their home after the town of Albion, Maine foreclosed on it in December 2015 due to nonpayment of property taxes. LePage was reportedly angered by the situation and attempted to intervene directly, even inviting Richard Sukeforth to his State of the State address in February.
Though LePage didn’t specifically reference reverse mortgages in that speech, he did speak at length about foreclosures and elder housing issues.
“Communities and the Maine Municipal Association may do things right — they follow the law regarding tax liens and foreclosures. But they should do the right thing: Help the elderly stay in their homes,” LePage said, according to the state’s transcript of the address.
“It is unethical and immoral to take away a senior citizen’s home,” the governor continued. “They lose all the equity they built up during their lives. They end up on the street.”
The state has yet to release any specific details about the legislation, and multiple members of LePage’s press team did not return requests for comment from RMD. The Morning Sentinel reported that the governor expected to have the legislation before the state’s legislature sometime in February.
LePage, known in New England and across the country as a conservative firebrand, has advocated for HECM products in the past, telling a Turner, Maine beef farmer at a 2015 town hall meeting that “maybe we can get you a reverse mortgage,” in response to his concerns about his tax burden.
More recently, LePage suggested at a January town hall meeting in Biddeford, Maine that all fixed-income homeowners should have a home equity loan.
Written by Alex Spanko


RMD Job Board: See Who’s Hiring to Grow Their Business

Each week, RMD compiles all of the jobs posted on the Reverse Mortgage Daily Job Board in the one spot where more than 7,000 daily subscribers in the industry can see it. This week, new positions from Professional Mortgage Alliance, Reverse Mortgage Funding, and HighTechLending join RMD’s list of jobs at reverse mortgage firms around the country.

Reverse Loan Officer/Certified Instructor – Professional Mortgage Alliance LLC
Inside Account Executive – Reverse Mortgage Funding LLC
Inside Reverse Mortgage Loan Officer – HighTechLending d.b.a. AmericanSenior
DE Underwriter – Finance of America Reverse
Reverse Mortgage Loan Processor – Finance of America Reverse
Wholesale Account Executive – American Advisors Group
Reverse Mortgage Banker – BBMC Mortgage (Division of Bridgeview Bank Group)
Reverse Mortgage Loan Processor – Longbridge Financial LLC
Underwriter – Longbridge Financial LLC
Reverse Mortgage Originator – Preferred Reverse LLC
Unique Opportunity for ONE Reverse Mortgage Specialist (Nevada-based) – iReverse Home Loans
Regional Sales Manager – Nationwide Equities Corp.
Reverse Admin/Lock Desk – HighTechLending d.b.a. AmericanSenior
Reverse Mortgage Loan Processor – HighTechLending d.b.a. AmericanSenior

Visit our website for additional opportunities in the reverse mortgage industry.
The best and the brightest read RMD. Want them to join your team? Post your jobs to the Reverse Mortgage Daily Job Board today!


Industry Vet Suits Joins Federal Savings Bank

Mike Suits, a mortgage veteran who has spent more than 15 years in the marketplace, joined The Federal Savings Bank as a senior vice president of home equity conversion mortgages, the Chicago-based bank announced yesterday.
Suits will lead Federal Savings’ reverse mortgage retail team in Austin, Texas, overseeing the bank’s planned growth in the region while also monitoring internal operations. The Round Rock, Texas resident most recently served as a reverse mortgage regional production director at Reverse Mortgage Solutions, Inc., which ceased originating loans last month when its parent company, Walter Investment Management Corp., announced its exit from the HECM-origination business. Prior to his job at RMS, Suits helped establish Capital Mortgage Services’ reverse mortgage unit as a division manager.
“I’m thrilled to have Mike join The Federal Savings Bank team,” executive vice president Mike Crossett said in a statement. “He has tremendous experience in the HECM industry and understands the customers well.”
Suits has served multiple HECM industry trade organizations, including the Texas Mortgage Bankers Association’s Reverse Mortgage Committee. The Texas A&M alumnus also played semi-pro football, and is certified to officiate high school football, basketball, and baseball games.
Written by Alex Spanko


RMF Uses “Unconventional” Message to Reach New Audience

Often featuring celebrity spokesmen who deliver messages geared toward needs-based borrowers, ads for reverse mortgages tend to follow a familiar script. But Reverse Mortgage Funding has taken an “unconventional” approach with its latest campaign, focusing on the reverse mortgage as an alternative to traditional home equity lines of credit. In the process, RMF says it’s tapping into a new group of potential borrowers.
Jean Noble, the Bloomfield, N.J.-based firm’s chief marketing officer, said participants in multiple focus groups and surveys thought that the “no payment feature” of reverse mortgages seemed “too good to be true.”
“We lose credibility because the feature is not relatable to any other financial product,” Noble told RMD.
So RMF began marketing its HECM credit-line products as “FlexReverse,” and introduced a two-minute television advertisement touting the “flexible payment option” in October. In the spot, which airs during a variety of sports, news, and movie programming, an actor portraying a potential borrower calls RMF and asks about the difference between home equity loans and reverse mortgages.
The RMF agent in the ad then says that unlike a home equity loan, HECM credit lines give borrowers “the freedom to pay as much or as little as you wish” — not even mentioning the option for not making any payments at all until the very end of the description. The tagline, both in a graphic and read by an announcer, encourages callers to “take control of your finances.”
The message mirrors what Noble told RMD in November during a discussion about changing industry terminology at the National Reverse Mortgage Lenders Association’s annual meeting in Chicago.
“That message really resonates with the customer base because they feel like they have flexibility and control,” Noble said in November.
Noble said RMF has gotten a positive response to the ads from consumers so far, noting that the “unconventional” message is attracting borrowers that normally would have opted for a traditional home equity loan.
“By going after this market we feel that we are doing our part to help grow the industry and attract a different type of customer,” Noble said.
Written by Alex Spanko


Data Key to Financial Planners’ Reverse Mortgage Perceptions

Originators and other players in the reverse mortgage space say that challenges remain when convincing financial planners and other retirement experts that reverse mortgages are a good idea for some borrowers, but a solid education can be the best cure for skepticism — and positive thinking about the products is gaining traction.
Shelley Giordano, chair of the Funding Longevity Task Force, says that she’s seen a steady improvement in understanding among financial advisors since the task force formed in 2012  Giordano specifically points to the gradual release of academic papers from researchers such as Wade Pfau, Gerald Wagner, and Barry and Stephen Sacks as key weapons against the perception of reverse mortgages as a loan of last resort.
“For the very first time, we [have] real data that stands up to this perception of what a reverse mortgage is,” Giordano says. Still, she noted that a lack of knowledge about HECM products continues to be pervasive.
“Unfortunately, financial advisors generally are not trained on housing wealth,” she says.
Ed O’Connor, a reverse mortgage specialist for First Bank Mortgage in West Babylon, N.Y., says he’s also noticed an increase in the prevalence of positive news articles about reverse mortgages, but that he’s still gotten the best reception from advisors who have actively put in the work to understand HECM loans.
“If they’ve taken the time to learn about the product, it either fits for a client or it doesn’t,” O’Connor says. “They’re not changing their thought process just because the rest of the world is.”
O’Connor also speculated that some financial advisors are beginning to see a subtle advantage to recommending HECM loans to customers that otherwise would need to take money out of their 401(k) accounts; if the client chooses a HECM, the advisor avoids taking a hit to the amount of assets under his or her control.
For financial advisor Jack Dvir of Financial Pointe in Newbury Park, Calif., the change in perception about reverse mortgages came only after close consultation with a trusted advisor. A former certified public accountant and a financial planner for the past 16 years, Dvir initially saw HECM loans as a final option for homeowners who had simply run out of money.
But after getting to know a reverse mortgage consultant who provided unbiased opinions based on clients’ actual financial situations — including, he says, advising against reverse mortgages for multiple customers — he began to trust the product and see HECMs as a potential option to cover long-term care expenses and other costs that spring up during retirement.
He likened the use of reverse mortgages to elevator safety: “You don’t want an elevator with just one cable. You want multiple cables in case one snaps. I’ve come to look at reverse mortgages to provide that extra cable.”
Dvir said he’s discussed reverse mortgages with about half of his clients — some of whom still react negatively based on news reports they’ve seen about foreclosures or predatory lending tactics. When faced with a skeptical client, Dvir employs the same strategy that convinced him: He shows the customer the hard numbers, running various scenarios to show how a HECM might or might not help them. And he’s won some converts in the process.
“It’s hard to argue with the numbers,” he says.
Written by Alex Spanko


Reverse Mortgage Originators Clocked Strong Finish to 2016

Despite persistent concerns about a downturn in the reverse mortgage industry, home equity conversion endorsements jumped nearly 20 percent in December 2016 as compared to the previous month, according to new data released today by Reverse Market Insight, Inc.
The Dana Point, Calif.-based research firm reported a 22.5 percent gain in retail endorsements and a 16.9 percent jump in wholesale endorsements from November 2016, for a blended overall total of 19.9 percent.
“That growth might have been fueled by some year-end cleanup, but growth is welcome from just about anywhere these days,” the firm noted.
Reverse Mortgage Funding continued its impressive gains, more than doubling its output in November 2016 — generating 748 loans — to claim a 9.9 percent market share for the year, behind American Advisors Group and Finance of America Reverse. Liberty Home Equity Solutions and One Reverse Mortgage rounded out the top five HECM generators by volume for 2016, according to RMI.
Written by Alex Spanko


Mnuchin Confirmation Raises Reverse Mortgage Foreclosure Confusion

President Donald Trump’s nomination of Steven Mnuchin to helm the Treasury Department raised a round of controversy about his involvement with reverse mortgage foreclosures — and Mnuchin’s 53-47 confirmation by the Senate on Monday revived the discussion in the media.
“This confirmation goes beyond letting the fox in the henhouse,” Democratic Rep. Maxine Waters of California, who serves as the ranking member of the House Committee on Financial Services, said in a statement released shortly after the confirmation Monday night. “They have given the keys to the Treasury to the Foreclosure King.”
Criticism of the new treasury secretary and former Goldman Sachs executive has focused on his time as the chairman of OneWest Bank and its Financial Freedom arm, which was responsible for 16,200 HECM foreclosures between 2009 to 2014, according to a December 2016 report by the nonprofit journalism organization ProPublica. News outlets particularly singled out one case from Florida in which a 90-year-old woman faced foreclosure proceedings over a 27-cent payment error in 2014.
But many in the reverse mortgage industry and beyond were quick to dispute the media coverage, noting that “foreclosure” has a different connotation in the HECM world than the popular image of a bank forcibly removing a borrower from his or her home.
Writing in the Huffington Post, Wharton professor emeritus Jack Guttentag noted that the Department of Housing and Urban Development’s official interpretation of HECM foreclosure refers only to a title transfer in a foreclosure proceeding, with the most common reason being the death of the last surviving borrower.
“The word ‘foreclosure’ is freighted with emotion because of its association with evictions of borrowers who have defaulted on their standard mortgages,” wrote Guttentag, who also runs a blog called The Mortgage Professor. “On HECM reverse mortgages, very few foreclosures involve evictions, which are rare and becoming more so.”
Guttentag called on HUD to compile and release detailed data about HECM terminations, including a cause for each, as a way to provide a clearer picture of HECM foreclosures. Brian Sullivan, a public relations specialist at HUD, told RMD that the agency has requested data from lenders about defaults stemming from the failure to pay taxes and insurance, though an official report is not yet available.
National Reverse Mortgage Lenders Association president Peter Bell took to The Hill, a political news site, to offer a similar message last month, responding to media reports about Mnuchin’s history of HECM-related foreclosures that did not accurately describe the term. Bell cited research from the Center for Retirement Research at Boston College that suggests HECM reforms introduced in 2013 could reduce actual loan defaults by 50 percent.
While NRMLA did not formally take a stance on Mnuchin’s nomination or confirmation, the Mortgage Bankers Association released a congratulatory statement on Monday night, noting the new secretary’s interest in tax and regulatory reform.
“MBA applauds the Senate for confirming Steven Mnuchin as the next Treasury Secretary,” the organization’s president and CEO David Stevens said in the statement. “His experience and deep knowledge of the financial markets will serve him well in this position.”
Similarly, Waters’ Republican counterpart on the House Financial Services Committee, chairman Jeb Hensarling of Texas, issued a laudatory statement Monday evening: “I look forward to working with him in my capacity as Chairman of the Financial Services Committee to advance policies that will help all Americans raise their standard of living and create a healthy economy,” Hensarling said.
Written by Alex Spanko


7 Must-Read Reverse Mortgage for Purchase Resources

Studies show that many older adults want to age in place during retirement. But others who aren’t yet ready to put down roots may choose to relocate, downsize or even upgrade to a new home during their non-working years.
A reverse mortgage can help these older buyers in ways that few financial products can, and it’s important for loan originators to get this message across to the millions of retirement age adults currently living the U.S.
Reverse mortgages already need all the consumer outreach and education they can get. The same is true for the Home Equity Conversion Mortgage for Purchase (H4P), which let’s face it, suffers from even greater unfamiliarity than HECMs in general.
If the average consumer isn’t familiar with reverse mortgages, or has enough understanding that a 60-second TV spot will allow, the chances are they don’t know you could actually buy a home using a reverse mortgage.
To assist lenders in their ongoing conversations with prospective borrowers about the merits of the HECM for Purchase product, RMD compiled a list of must-read articles to both reference and share with clients who could potentially benefit from an H4P:
5 Ways Reverse Mortgage Pros Can Grow Their H4P Business—As more Baby Boomers retire and become eligible for reverse mortgages, their desires to relocate later in life present a huge market opportunity for the H4P product. This article provides several ways reverse mortgage originators can position themselves to grow their H4P business, according to one reverse LO for whom H4P represents 80% of his business.
Baby Boomers’ Housing Needs May Pave the Way for H4P—Although the preferences of younger buyers will ultimately shape the future of the housing market, homebuilders and reverse mortgage originators alike must also pay attention to the housing needs of Baby Boomers and the challenges they face when buying a new home, according to a study from the National Association of Home Builders. This study, which was co-sponsored by a top-10 reverse mortgage lender, offers insight into the housing preferences of retirement age adults and how these buying trends could help influence their purchasing decisions.
Forbes: Benefits of Using Reverse Mortgages for Home Purchases—Reverse mortgages have many different uses that can accommodate a variety of personal needs, but one particular usage that is often overlooked by the general public is using these loans to purchase a new home, according to Forbes. Written by an esteemed retirement income expert, this article provides an accessible understanding of the practical use of a HECM for Purchase and its implications for retirement planning.
About.com Weighs the Benefits of HECM for Purchase—In this consumer-facing article on the H4P product, About.com tackles the subject of how to use a reverse mortgage to purchase a new home—a topic the consumer information site suggests has been left in the dark. The article is written by a financial planner and provides an objective view of HECMs and the H4P, including important considerations for prospective borrowers to think about when weighing the decision to get a reverse mortgage.
Seeking Alpha: H4P is Critical Alternative for Home Buying Retirees—A new home can be an expensive purchase, especially for retirees with limited liquid resources to fund this type of transaction. While most buyers generally have two options when it comes to buying a new home, SeekingAlpha suggests that a reverse mortgage can provide a critical third option for certain retirees. SeekingAlpha provides content that features stock market insights and financial analysis, including earnings transcripts, investment ideas, ETF and stock research written by finance experts. As such, SeekingAlpha targets the financially savvy reader, including Baby Boomers and other retirement age adults looking to expand their economic horizons.
Selling Home Builders on Reverse Mortgages, One H4P at a Time—Call a HECM for Purchase a “sleeping giant,” a vastly underutilized product—call it whatever you like. One full-service mortgage banker, however, is calling H4P the bulk of its reverse mortgage business. This article provides insight into one company’s strategy and successes in the HECM for Purchase market, including its partnerships with homebuilders specializing in age 55-plus housing.
Denver Post: H4P Sweetens the Deal for Retired Home Buyers—For older homeowners looking to buy the retirement home of their dreams, a reverse mortgage can help sweeten the deal through a HECM for Purchase, according to an article published by The Denver Post. Contributed to the Post by a reverse mortgage loan specialist, this article explains the practicality of using an H4P to buy a new home, while also dispelling a few common reverse mortgage myths in the process.
Written by Jason Oliva