The reverse mortgage industry is approaching the one-year anniversary of last year’s principal limit factor reductions, which continue to have an effect on originations and the overall outlook for the space into the future. But 2018 has also been a year of innovation for lenders and originators, with a slew of new proprietary loans hitting the market and major players reinventing themeless as retirement service providers — and not just Home Equity Conversion Mortgage lenders.

To get a sense of where the industry might be headed as we enter the Department of Housing and Urban Development’s new fiscal year on October 1, RMD sat down with Scott Norman, vice president of retail sales and government relations at Finance of America Reverse. Norman, a past president of the Texas Mortgage Bankers Association, had recently celebrated the organization’s 19th annual Reverse Mortgage Day conference outside of Dallas, and he weighed in on the industry’s present and future.

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To relieve some of the financial burden on widows, Social Security policy experts should looking to modernize the program by increasing the benefit dedicated to these surviving spouses, according to a new brief from the Center for Retirement Research at Boston College.

The Social Security widows benefit has been in place since 1939, created during a time when most households were single-earner, with a breadwinning husband and homemaking wife. But as more women have entered the workforce, many wives now receive their own Social Security benefits. Unfortunately, a wife’s earning does not increase her widow benefit, the brief notes.

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To help reverse mortgage professionals keep tabs on the market, analytics firm Baseline Reverse last week released a daily HECM index that tracks Home Equity Conversion Mortgage bond prices.

Specifically, the index reflects “real-time HECM mortgage-backed securities (bond pricing) for a basket of 2017 PLF Annual LIBOR loans,” according to the company’s website. Baseline Reverse founder Dan Ribler told RMD that the St. Johns, Fla.-based firm keeps the makeup of the basket constant to develop a “clear reflection of the rate curve and spread changes.”

Until the release of this index, Ribler said it was difficult for the reverse market to stay on top of the numbers day to day.

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Baby boomers and seniors who proactively set up retirement accounts have more than $100,000, on average, in savings than their peers who did not, according to a recent study by personal finance publication MagnifyMoney. But across the entire board, 29% of households have less than $1,000 saved in any type of account.

Using data from the Federal Reserve and the Federal Deposit Insurance Corp., MagnifyMoney looked at the saving trends of about 126 million U.S. households as of June 2018. In an effort to substantiate reports that Americans weren’t setting aside enough, MagnifyMoney estimated the average and median balances of different types of savings accounts.

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As the aging population grows and seniors struggle with shrinking retirement benefits, home-sharing is gaining in popularity with baby boomers who want to bring in some extra income — and could emerge as an alternative to tapping into home equity.

One company offering this service is the Denver-based Silvernest, which matches senior homeowners with renters based on applicant profiles and personal preferences. Through the site, homeowners and potential housemates can conduct background checks, “meet” online, create leases, and process rent payments, according to Silvernest CEO Wendi Burkhardt. For boomers and empty nesters looking for extra cash, leasing a room can bring in about $10,000 a year on average.

Home-sharing is not a new idea — think the classic 1980s sitcom “The Golden Girls,” or the popularity of Airbnb for vacation rentals — but it is gaining more traction. Silvernest isn’t the only senior home-sharing service on the marketplace, sharing the space with other sites such as Golden Girls Network and Senior Homeshares, and AARP has found that 4 million women aged 50 and older live in U.S. households with at least two other women over 50. As the population ages, that number is expected to rise.

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Although often avoided, planning for widowhood can be crucial in avoiding financial crisis if the unthinkable happens, recent research from Merrill Lynch suggests.

To better understand how this life-changing event can affect a surviving spouse, Merrill Lynch partnered with Age Wave, an aging population research firm, for a report called “Widowhood: What to do when your spouse dies.”

The research shows that almost 78% of widows or widowers are women, yet in many cases they are not prepared for the financial decision-making, reduced income, and mounting paperwork that can follow the death of a spouse. In fact, 60% of both men and women are immediately burdened financially when a spouse dies.

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As new proprietary reverse mortgage products are teased and released, California sits as a prime potential market for borrowers looking for home equity-tapping options outside of the federal program. Favorable tax laws, high property values, and a large retiree population are a few reasons why jumbos could be poised to take off in the state.

This past year has seen a groundswell of proprietary products hitting the market as lenders adapt to a space with lower principal limits available through the traditional reverse mortgage. Aside from the Home Equity Conversion Mortgage, homeowners currently can shop among four jumbo products: Finance of America Reverse’s HomeSafe product, Longbridge Financial’s Platinum product, the Equity Edge from Reverse Mortgage Funding, and the HELO from One Reverse.

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