Mr. Bachman,

You have a great idea. Truly the vast majority will be served by the introduction of this card, although my concerns over the few still remain. Kudos to you!!!

However, you never did explain why you resorted to nonexistent regulations as your quotation device. The information you presented above was well reasoned, well presented, and well done. IT serves you well. Your article would have been far superior had you put some of that information into the news release. The device you used in the news release did not serve you well at all.

Absolutely great response!!! You at least enlightened me. Thanks for dropping in, RMD can use your insight.

To Golden Gateway Financial-

I think this is an awesome idea! I have clients that would rather not have money in a checking account. Some have expenses that exceed what they CAN have in a checking or savings account due to Medicaid or other public services.

This is a wonderful way for them to have access to more money without jeopardizing their public services.

Will you offer it to folks that didn't get their reverse mortgage through your company?

Thank you!

I like that people are responding to critics on RMD... for some reason it just started happening, not sure why things have changed but its great.

Eric, I think its a great idea, I've had customers pay for appraisals using a money order because they didn't have a bank account. So if someone is offering them a prepaid card that helps them access their reverse mortgage proceeds.... awesome.

This is a lively discussion- I just thought I’d drop in to shed some additional light. If you read all the way to the end, I promise to do something ill-advised.

For clarity’s sake:
- We charge NOTHING for the card. We even got the issuing bank to waive ATM fees for withdrawals.
- The card is absolutely optional.
- We don’t even discuss the option until after the reverse mortgage is completed. The pre-paid “Your Money” card is one potential destination for the reverse mortgage monthly disbursements.

I have two objectives in launching the “Your Money” card; one is self-serving, the other is not.

The beneficent goal is safety and convenience for seniors. With the Your Money card:
- The senior does not wait for a check to come in the mail every month.
- There is no chance for the check to be stolen out of the mail
- The un-banked senior (there are a lot of them) don’t have to pay exorbitant check cashing fees.
- The senior can access the money at any ATM.
- If the senior opts to transact from the card, s/he gets the protections of MasterCard’s chargeback protections.
- If the senior losses the card or if it is stolen, the bank will replace it with it’s full value intact.
- With the standard statements (not bills- the card is pre-paid) the senior can get a better sense of where his/ her money is going and, hopefully, make it last a little longer.
This program is similar to the Social Security Administration’s move to distribute benefits on a pre-paid card only, because the card is MasterCard branded, the senior has the benefit of easier access and chargeback protection.

“What is the self-serving goal?” you ask. Differentiation. When I founded this company, it was not be a typical reverse mortgage brokerage. My goal is to build a trusted financial brand for seniors. From the start we have made every effort to create greater transparency, to provide better education, and to move the bar in an industry that is, quite frankly, not always very forward thinking. We will continue to offer products and services that add value for our customers and separate us from the rest of the pack. And yes, we will continue to get good press for doing it.

Now, here’s the promised, ill-advised move. My email is EricB@GoldenGateway.com . I place this here knowing that some of you will choose to “slam me” more directly. I’m hopeful that some of you may wish to be kinder, or even to let me know that you’d like to be part of a growing, forward-thinking, customer focused organization.

Before analyzing Mr. Bachman’s statement let’s look at Mr. Stumpf’s, the CEO of Wells Fargo, testimony yesterday before Congress. Why would he voluntarily and self-righteously declare that his bank produces no negatively amortized mortages? I guess he forgot he is the CEO of the nation’s largest retailer of reverse mortgages. Last I checked, most of my amortization schedules look negatively amortized. What was this guy thinking???? Can anyone in the Reverse Mortgage Division at Wells have a “little chat” with this “loose cannon”???

Now let's carefully review what another reverse mortgage leader, Mr. Bachman, has to say in the following compound sentence: "New government regulations are making reverse mortgages more desirable than ever, and we’ve introduced these new services to provide even greater control and access to the funds made available through these programs." (Emphasis added). This quotation was taken from a Golden Gate Financial published “news” release. It is not the misquotation of some independent reporter.

It seems Mr. Bachman wants to tie how “new government regulations” are making HECMs more desirable to what GGF is doing -- but is that justifiable? Notice that they are not presented in two different paragraphs or even two different sentences. They are tied together by the conjunction “and.” He wants them viewed together. So let’s do that, remembering that he did not make this statement spontaneously or “off the cuff.”

Does anyone have any idea what “regulations”, Mr. Bachman is alluding to? Are his opinions in what follows as solid as his statement about regulations? As an alleged leader in our industry, Mr. Bachman cannot be excused as “not expected to know” that there are no such regulations. This was a crafted and planned statement.

If Mr. Bachman is alluding to the latest Mortgagee Letters, his statement is very revealing. He could have said “the government is providing rules that…” but no, he chose to exaggerate the level of government action so as to add importance to what he wants to say after “and”.

Like others, I have strong doubts if this new feature is anything that was developed to help the seniors use their proceeds in a sensible way. Will this “enhancement” improve the decision making of those seniors who will unwisely spend their proceeds or simply encourage impulsive habits?

GGF is consistently hyping what they do and they do it WELL. The same cannot be said for Mr. Stumpf’s testimony. Other than Mr. Bell and a few other well respected RM leaders, it is very, very rare that our RM leaders make clear and responsible statements.

This is a cool idea and can make reverse mortgages even better provided it is merely an easy way for seniors to withdraw from their line of credit when the need it instead of having to fax in or mail a request AND the interest rate is the same as it would be if they made a regular transfer or withdrawal. Anything that makes it easier for them is good. But if it is a way to make extra money by the banks by charging a different rate than the rate they would normally be charged or adding service fees, then forget it.

I am not clear - is this a credit card you can go to a store and buy stuff or is it some type of service? If it is a credit card,my concern here security. Several of my clients have had their credit cards stolen/used by kids or workers in the home. If it is a credit card it one more way bad people can exploit the senior. Also, are there any additional costs for accessing their money?

are they also limited to a $400 daily withdraw? look at the fees they will pay to access their own money. only the issuers and side deals from the mtg company makes money on this deal

Mr Reverse,

It's not a credit card, it's a prepaid card. Typically there are fees to withdraw the funds but its not nearly as expensive as places like Western Union, ect.

here we go again: Maybe consumer magazine has it right "lets take all the seniors money". Where is the benefit of seniors putting thier money on a credit card so they can borrow it quicker. Great for thye lender who will be adding on intrest charges faster as they take lump sums to fund the cards. Where is the credit card company making thier money other than using the seniors money as it sits in the account. We have always tried to stretch seniors money by sending them a check and in emergency they can draw more money as needed.
And also, with our congress MEMBERS who are clueless to seniors problems and voted to put a cap on our fees though no other industry has that problem. This limits banks and brokers fees which made Banks forced to increase thier margins and will make money and seniors will end up with less money as they are talked into taking all the cash out. Many are putting money in cd's insurance products and not enjoying the benefits of a life time income. wait till seniors interest rate reaches 8and 9% with margins now 3.25% indexs will be going up and with the high margins don't be supprised at rates.
Who is looking out for seniors?