In a letter sent January 27 to Sen. Michael Sanchez (D-N.M.), NRMLA stressed concerns regarding the Mortgage Fair Foreclosure Act, which states that in New Mexico, “homeowners should be given reasonable notice of the fact of and basis for an alleged default on their mortgage, apprised of all loss mitigation methods available to them in connection with their home loans prior to the loss of their home and afforded a meaningful opportunity to participate in loss mitigation to prevent the loss of homeownership.”

The bill includes loss mitigation efforts such as a review and underwriting of income to assess a borrower’s ability to stay in the home under a revised loan modification plan, NRMLA explained. Such payment plans have no relevance to a reverse mortgage.

While it is not a reverse mortgage bill, per se, it could impact all servicers, NRMLA notes.

“If the borrower is in default under his or her HECM mortgage because of failure to pay property taxes and/or hazard insurance, HUD has robust procedures in place for servicer to assist seniors in curing such a default, including post-closing servicing related counseling with HUD-approved counselors,” the NRMLA letter states.

The provisions are designed to account for the unique features of reverse mortgage loans, NRMLA writes, urging an amendment to the bill that would exclude reverse mortgages.

View the New Mexico Senate Bill.

Written by Elizabeth Ecker

Conference goers will get a chance to take a bite out of the Big Apple on March 26 and 27, when “Washington, Wall Street and the reverse mortgage community will converge and convene amidst the glamour of New York City,” NRMLA said in its announcement.

The decision to hold the event in the city that’s been called the “Capital of the World” partially stems from discussions about a capital markets meeting and an effort to combine this sector with NRMLA’s membership, providing a chance for interaction, according to Marty Bell, senior vice president of marketing and communications at NRMLA.

The first session will be held Monday morning and will continue through Tuesday afternoon.

More details about the conference, including hotel information and registration, will be made available soon.

“The government plays a lot of roles,” Bell said. “It provides a credit enhancement…it gives clients the assurance that what they’re doing is something somebody has thought through.”

Freeman asked whether reverse mortgages fall into the same debate as other areas of housing.

“If people are in more house than they can afford, doesn’t it make sense that they sell the house and move to an apartment?” he asked.

Bell further defended the program and the lack of options for many seniors who don’t have the retirement income they expected they might have.

“In many cases, [moving] is just not an option for them,” he said.

Written by Elizabeth Ecker

“We view reversemortgage.org as an entirely new site,” says Peter Bell, NRMLA president and CEO. “The look is new, the content is new, and there are many new educational tools included.”

The site’s content is based largely on input from lenders, Bell says.

“All of this has been created with extensive input from our membership. We asked lenders, originators, servicers, closing agents, what is the information clients most want and need—and we tried to include all of it. Our goal was to make the educational process for seniors and their families and advisors more accessible and more comfortable,” he says.

From advice to children of borrowers to a detailed description of the loan process from application to counseling, closing and disbursement, the site also includes a list of NRMLA-certified reverse mortgage professionals.

Frequently-asked-questions address common borrower concerns regarding servicing, insurance, requirements, loan types and other details regarding the products available today.

“This is a soft launch, a chance for our membership to have a look and feed us suggestions as well as to monitor how the site functions,” Bell says.

NRMLA is currently collecting feedback on the new site and ways that it can best serve the borrowing population as well as members. The association will conduct webinars in the coming month to walk members through the site and is planning a wider public launch for roughly a month from now.

View the Borrow With Confidence site.

Written by Elizabeth Ecker

“It’s recommended that you verify only enough [income sources] to qualify,” said Steve Irwin, executive vice president, policy for NRMLA. The association’s committee on financial assessment has been referring to such measurements as “circuit breakers,” he said.

Irwin reiterated NRMLA’s guidance on the capacity and condition tests in an email to RMD.

“The NRMLA Guidance on Limited Underwriting states: ‘The lender should gather only the minimum amount of information necessary and appropriate to perform and document the Capacity Test and the Applicant Condition tests,’” he said.

The qualification process, so far, has added time and steps for MetLife borrowers, working with the one and only lender that has publicly implemented changes based on the recommendation from NRMLA. The company told RMD in November that it had added resources to aid in the process and address questions for originators as they adapt to the new procedures.

Under the NRMLA guidance, which has yet to be formally adopted by other lenders, originators are encouraged to verify a borrower’s income sources to ensure that he or she has the capacity to pay for property charges including tax and insurance.

But what many have called stringent new guidelines shouldn’t rule out borrowers unnecessarily, NRMLA says. The recommendation is to use them as much as needed and not further.

“We don’t want to make this overly complicated or burdensome. Verify enough to qualify and then stop,” Irwin said during the webinar. “…require only the minimum amount of information necessary and appropriate,” he told RMD. The circuit breaker concept, he said, would enable to lender to stop collecting documentation from the applicant who demonstrated the ability to pass the capacity test and the applicant conditions tests.

Many originators have speculated that the new underwriting is likely to rule out a good number of borrowers, with industry analyst Reverse Market Insight estimating that the changes implemented by MetLife could rule out as many as 10% to 30% of borrowers that would have qualified prior to the changes.

Written by Elizabeth Ecker

Co-chairing the board for the 2011-2012 year are Sarah Hulbert retail business development manager for 1st Reverse Mortgage USA and Joe DeMarkey assistant vice president of MetLife Bank. Both Hulbert and DeMarkey have served as chairs in the past.

Vice chairs for the coming year are Genworth Financial Home Equity Access President Pete Engelken, and James B. Nutter and Company’s George Lopez. Also serving on the board are Secretary John LaRose of reverse mortgage sub-servicer Celink, and Treasurer James Cory of Legacy Home Financing.

The new board officials will serve for the coming 2011-2012 year along with past-chairs, other board members and NMRLA staff.

Written by Elizabeth Ecker

The decision was announced Monday after NRMLA board members met on the topic.

“The announcement was the least of it,” said Peter Bell, NRMLA president and CEO. “It’s the coming to understand exactly what’s going on and the importance of updating the way we do the reverse mortgage busness to recognize we need to have some basis for qualifying applicants. I think it was the responsible decision.”

Other conference sessions covered topics from online marketing to a face-to-face counseling mandate for certain HECM borrowers in Massachusetts. Attendees heard from Department of Housing and Urban Development representatives including Federal Housing Administration Acting Commissioner Carol Galante as well as HUD’s Karin Hill, Office of Single Family Program Development director; Colin Cushman, director of portfolio analysis; and several representatives from HUD’s servicing team.

In her address of the industry, Galante stated strong support for the HECM program as well as for the restoration of housing counseling funds that were slashed by Congress earlier this year.

“Carol is someone who has been a user of HUD programs and actively engaged in a company involved in HUD programs,” Bell said, noting Galante’s former roles in the private sector. “Even though she’s only been in the job three months, she comes in with a lot more upfront knowledge than others who have been in that job,” he said.

Also discussed at the conference was the status of housing counseling funding, currently under discussion by Congress. Galante stressed the importance of regaining the funds and noted her strong efforts on Capitol Hill toward that end.

Overall, the conference was well received, Bell said, with attendance exceeding expectations, especially in light of the economic time.

“As staff, we felt it was a good meeting,” he said. “A lot of [attendees] said the sessions were the best they’ve ever been.”

Written by Elizabeth Ecker

“For those of you who are tired about reading misperceptions…we have a tool for you,” said NRMLA Communications Director Marty Bell before attendees of NRMLA’s annual convention in Boston this week. “This is an aggressive public affairs campaign.”

Coined “Borrow With Confidence,” the campaign will roll out in the coming days and weeks.

The association responds to every negative story about reverse mortgages, no matter where in the country, Bell said, but this new website and messaging campaign will provide a proactive approach to generating accurate and thorough information about reverse mortgages.

Bell urged the participation of all members in using the campaign and sharing it with borrowers.

A booklet with large print type is available online as well as in hard copy form in addition to a new website that houses a lender locator, including brokers.

The new site will be found at www.reversemortgage.org when it launches over the course of the next ten days.

Written by Elizabeth Ecker