AARP has long been a disingenuous, hypocritical business. As a supposed “disinterested third party”, they have seniors advised for years to wait before getting a reverse mortgage, for many self-serving reasons. How many seniors in today’s market of declining home values have been shocked and angry when finding that, after taking this “advice” from AARP, they no longer qualify for a reverse mortgage, and will lose their home? It wouldn’t take many of these victims telling their story to their local “Action News” TV reporter to begin to dial back the abused power AARP now wields.

I have long been skeptical of AARP’s disingenuous advocacy of seniors. When its tax-exempt status was challenged by the IRS, AARP was forced, as part of the settlement (in which it paid millions of dollars in back taxes) to spin off its profit-making entity into a separate, taxable corporation.

While AARP provides some useful information about reverse mortgages to seniors, it main agenda is to increase membership (and the resulting advertising revenues from its publications) and sell products through its various arrangements, mostly with insurance companies. Unfortunately, many seniors are so convinced that AARP-branded products and services represent the best value that they fail to shop for better deals among other providers.

AARP exists, first and foremost, for the purpose of generating revenue for its officers and staff; legislative advocacy is a by-product that must be adjusted so as not to offend partners in its lucrative business arrangements. For example, AARP doesn’t advocate national health insurance because its insurance partners would be adversely impacted by such legislation.

When AARP decided to put its two cents’ worth into FHA Modernization by advocating a reduction in the maximum HECM origination fee, Congress (and NRMLA) capitulated because of its perception that AARP controls the opinions and votes of millions of seniors. I seriously doubt that. The reverse mortgage industry, trying to eke out a modest profit under the “old” fee structure, made up for the “new” fee structure by increasing the margin (i.e., the interest rate) in order to replace lost revenue. Is the senior really better-served?

Other senior organizations exist that actually don’t endorse any commercial products and do an excellent job of serving the interests of seniors. One such organization is the Alliance for Retired Americans, which has ties to organized labor. Other such organizations are tied to the members’ religious membership, former profession or military retirement status.

Since my 50th birthday ten years ago, I have been deluged regularly by membership offers from AARP. All have been deposited into the shredder. After all, I don’t want anyone to know my age!

RMD readers may be interested to know that AARP is in the process of choosing ONE RM lender to endorse! After all these years when they’ve refused to endorse any lender they are now vetting several of the largest lenders…..too bad that wont’ translate into the senior getting the best service or the best product!