This week we saved a woman's home, 1 day before it was scheduled for the court steps. These stories get ZERO MEDIA ATTENTION WHY?

Our industry helps thousands of senior borrowers every year and we're getting really fed up with these reports and irresponsible journalism!!!

It continues to amaze me how people can say a reverse mortgage is the worst thing when I have seen it help so many. I have sat with families and said to the children, “Your folks are in need of financial assistance right now and have serached out other options that won’t work. Can you afford to make monthly contributions to them in an effort to preserve the home that would eventually be your inheritance? No, well do you want them to continue struggling with their expenses like they have for the last few years? No, well do think their getting a reverse mortgage is the best option they have right now or can you offer something else?

The most unfortunate situation is the parents who want to make their decision on their own without the children as far as the industry is concerned. Those who are included in the decision may actually come up with another alternative. And, if they don’t, they at least understand the thought process that came to that decision.

As to the bad publicity, I keep the good articles to send to customers who tell me that is a concern. However, it is sad that some reporter would use sensationalism to sell news at the cost of some Senior being afraid to do a reverse mortgage and then go through foreclosure and no longer have his or her home. They should call the reporter to help them make the payments they can no longer afford and see what alternatives he or she offers. They may not be so quick to judge without really learning the facts after that.

News stories of this nature seem to come in waves. In the first few years of the industry (the early 90’s) there were very, very, few such stories about HECMs because very few HECMs were terminating, home values were slowly appreciating, and HECM marketing was minimal.

However, there were dreadful stories due to terminations of reverse mortgages from the days when banks shared in appreciation, interest rates were substantially higher, not all reverse mortgages were nonrecourse, and when balances due went higher than home values, foreclosures were instituted. That publicity was ugly but because of the low number of those types of reverse mortgages, such stories were rare. If you get a chance talk to some HECM “pioneers” about those early days in the industry, they can provide interesting insights.

For the first six years of this decade, things were much rosier. Home appreciation was accelerating. Here in Southern California 8% appreciation rates on Amortization schedules looked overly conservative if not distorted. What HECMs did terminate between 2004 and 2007 on the West Coast, Nevada, and Arizona properties were normally paid in full from the sale of the underlying security. We went from a period that only a few seniors had heard about reverse mortgages to an era when celebrities like Jerry Ohrbach, Pat Boone, James Garner, and Robert Wagner raised the awareness of reverse mortgages as never before with an unprecedented growth in HECM origination volume.

Today the situation is much different.

HECMs have been with us for about two decades but NRMLA just one.

Our own good (and bad) marketing keeps the reverse mortgage product constantly in front of the public eye which has both good and bad aspects. More seniors are more aware of reverse mortgages than ever before. This also means, bad news will make headlines much more easily than in the past.

As the growth of HECM terminations accelerate during and shortly after this period of dropping property values, the number of complaints by heirs, non-borrowing spouses, and those with balances due greater than home values will only grow. We all need to be prepared for the darker days just ahead.

Over time, property values should increase and the peak of these new stories should be reached. In between we will be in for some rough sailing but with brighter days hopefully just over the horizon.

The New York Times has an interesting article on The Nationwide Mortgage Licensing System today, 8/23/2009.
http://www.nytimes.com/2009/08/23/realestate/23…

Hopefully it will catch some of the bad apples in your industry, although it sounds a little weak on bank employees requirements.

Again, the keey word here is the “BROKER” steered…let's not paint the industry in a negative light due to some bad brokers out there. The Counsumer Reports article also noted a broker was at the bottom it.

I agree that NRMLA must lead. But they must also organize our opposition against such bold attacks. We've been told that we make as many problems as we solve by our protests, but we need instruction on how to make our protests change minds. We can't simply bludgeon them as they bludgeon us. Street fights (metaphorically) will not win the media or state and federal legislators over. Obviously, our national association lobbyists are not winning them over either (probably because the media only wants a good muck raking story and the lawmakers only wants to turn away attention from their own legislative morass). We need to join our forces, and make the most of our troops, because folks, we are at war and we are losing the ground we've tried for years to gain.