A new year brings new opportunities. And for the reverse mortgage industry, 2016 could be one of the most promising years yet.
The reverse mortgage industry turned a critical corner in 2015. HECM program changes like the Financial Assessment and updates to the non-borrowing spouse policy ushered in a new era for the reverse mortgage product, capturing the attention of researchers, financial planners and generating positive press in the mainstream media.
In an extra boost of confidence for the industry, the economic value of the Home Equity Conversion Mortgage (HECM) program grew $7.9 billion in Fiscal Year 2015—progress that was applauded by the Department of Housing and Urban Development
With this huge victory for the HECM program, along with the most recent program changes that took place last year, it appeared that everything was finally falling into place for the embattled reverse mortgage industry. Such accomplishments have also created considerable headwinds for reverse mortgage lenders over the next year.
To learn more, RMD reached out to various reverse mortgage leaders to hear what they view as the biggest opportunities for the industry, as well as their own companies, in 2016.
“I see a huge opportunity in 2016 and beyond by finding a way to simplify the HECM origination process. The process was incredibly complex already. Financial Assessment added to that burden. As an industry we need to invest in out of the box technology to simplify the process.”
–Michael Hild, CEO, Live Well Financial
“We expect 2016 to be another exciting year for the reverse mortgage industry. Recent changes to the HECM program, specifically the implementation of Financial Assessment and revisions to the non-borrowing spouse guidelines, have created a more sustainable and responsible product. Looking ahead, we will continue to focus on offering flexible solutions, industry insights and responsive service to our clients and partners. This includes further raising awareness of the benefits an H4P loan affords older Americans who are looking to purchase a new home, as well as highlighting the beneficial product features of a HECM as compared to a Home Equity Line of Credit.”
–Joseph P. DeMarkey, Strategic Business Development Leader, Reverse Mortgage Funding, LLC
“We are bullish on the demand for the reverse mortgage product, especially with a growing tech-savvy consumer base. Our Henderson, Nevada sales force has doubled over the past six months and, contrary to previous years, we have continued to hire throughout the holiday season and will continue to hire aggressively into Q1. We are focused on expanding our marketing efforts in 2016, both locally and nationally, to maintain this growth and strengthen our position in the industry.”
–John Miller, President, Proficio Mortgage Ventures
“We still have a lot of perceptions to get over. Financial Assessment was positive for the industry, but the industry has legacy loans that didn’t have FA. We’re going to have to tactfully weave through those loans and the negative press before we can start to see a more uphill trend in the perception of the product. I think we’ve come a long way, but there’s still a long way to go. At Finance of America Reverse we’re still finding ways to offer products that are right for seniors and fit their needs. We’re never going to grow as an industry unless everyone is doing the right things for the borrower.”
–Kristen Sieffert, President, Finance of America Reverse
“The stability and removal of headwinds in connection with issues that were addressed vis-à-vis in the last three years of policy changes. That brings the next version of the HECM, in essence, to the market—a different level of credibility, a safety for the MMI fund, lenders and consumers. That also removes headwinds associated with media sensationalism, borrower issues, MMI issues, and that in and of itself should be an opportunity for this industry.
“This industry has been absorbing change after change. What we need is a prolonged period of stability to then be able to forward think, invest, innovate and start talking to the segment of the demographic that, right now, will not consider the product. Hopefully that stability will allow us to be more forward-thinking and strategic. That’s analogous with AAG and what we need to do as well.”
–Reza Jahangiri, CEO, American Advisors Group
Written by Jason OlivaPrint Article