I’m sorry for the spelling errors. You can most likely find grammar errors as well…

But as far as 1st Reverse and WSFS, only time will tell what will happen with them in the future. I personally hope that they do well and continue with their reverse mortgage business.

I thought I was pretty clear, but I will slow it down for you….

When you purchase a company, often times you expect to take a loss for a SHORT while. But you can not continue to loose 500k plus per quarter. Based on their comments, they are not sure how long they want to continue with a company loosing money.

THESE ARE THEIR STATEMENTS: “At the same time, we are also working with 1st Reverse management on our strategic alternatives for that business, which could include partnering, a sale of part or all of the business, or an orderly wind down if we cannot get sufficient traction.”

YOU STATED: “Then in your fourth comment you seem to take that statement back and declare: “I don’t know.”

As far as the “I don’t know” statement, Can you or I be sure if it is a good idea for them to continue to loose money without knowing their strategic plan and balance sheet?

YOU STATED: “Many businesses take a lot more losses than that and survive. The question is whether these are needless book losses or is 1st Reverse positioning itself for something in the future?”

MY RESPONSE: Based on what you stated,(that you are now saying you didn’t say) I am agreeing that they could be positioning themselves for the future.

…I just don’t think so. I think they are feeling like they made a mistake with the purchase of 1st Reverse, based on the economy, FHA insurance shortage, FNMA not wanting to purchase so many reverse mortgages and raising the margins through the roof and higher interest rates coming, among other reasons.

YOU STATED: I for one have no idea what your point is. Can you explain it? It is all right to be wrong but when you keep making these contradictory and incorrect claims and statements, few of us know what you mean.

MY RESPONSE: I guess I do not know what statements were wrong, contradictory or incorrect.

I am not saying it is right or wrong for them to continue with reverse mortgages. I don’t know… But it would be a strategic decision for WSFS to continue to invest in 1st Reverse knowing the pressures on the reverse mortgage industry at this time.

I agree with you that most companies take losses before they turn a profit. I’m just saying that in today’s environment, it is going to be a tough call. No one can take the losses forever…. we’ll unless you are the US government.

http://reversemortgagedaily.com/2009/05/07/obama-administration-requests-798-million-to-aid-reverse-mortgage-program/

and

http://rminsight.net/blog/2009/05/hud-signals-hecm-future/