Less than 40% of Americans say their retirement plans are on track, and non-retirees report widespread confusion about some common financial tools and concepts, according to a new report from the Federal Reserve.

Three-fifths of working people with 401(k)s, IRAs, and traditional savings accounts reported “little or no comfort” with managing them, the Fed found in its annual Report on the Economic Well-Being of U.S. Households for 2017, released Tuesday morning.

Continue reading →

On the same day Reverse Mortgage Funding announced its new proprietary Equity Edge Reverse Mortgage, two more companies affirmed their commitment to building the private home equity conversion loan space.

Longbridge Financial will introduce multiple private reverse mortgage products this year, CEO Chris Mayer announced Monday* at the National Reverse Mortgage Lenders Association’s eastern meeting in New York City.

“The idea that nearly our entire industry relies on the federal government for what it does, in addition to all of the state rules .. it’s really hard to run a business that’s so heavily dependent on Washington,” Mayer said, according to a statement released by NRMLA. “It is important to offer non-FHA reverse mortgages so the industry is insulated from policy changes and can serve a wider variety of customers.”

Continue reading →

One of the anecdotes circulating around the industry is that a Department of Housing and Urban and Development employee is claiming that reverse mortgage losses in the Mutual Mortgage Insurance Fund (MMIF) will drop if volume goes up.

The logic is that the higher the endorsements, the more mortgage insurance premiums (MIPs) there will be to offset losses. The following two charts — one graph, and one table — provide a quick means to grasp certain numeric information contained in the HUD Annual Report to Congress regarding the financial status of the Federal Housing Administration MMIF for fiscal 2017, dated November 15, 2017 — also known as the Fiscal Year 2017 Annual Report. This is crucial to understanding important points related to this anecdote.

Chart 1 shows HECM losses in the MMIF by cohort of HECMs endorsed in the same fiscal year. The losses for the HECMs endorsed in fiscal 2009 is by far the largest. As seen in this graph, the largest number of HECMs endorsed in any fiscal year reflected in the MMIF is also fiscal 2009. Fiscal 2014 resulted in the second lowest endorsements of any fiscal year in the MMIF, along with the smallest loss for any fiscal year.

Continue reading →

Reverse Mortgage Funding on Monday will join the proprietary reverse mortgage loan market, announcing the Equity Edge Reverse Mortgage for borrowers aged 60 and up.

The new product, which will officially become available to borrowers June 1, is specifically targeted at homeowners with properties valued at $700,000 or more — as well as those with non-Federal Housing Administration-approved condos.

The goal, according to RMF president David Peskin, is to help fill several voids created when the Department of Housing and Urban Development lowered principal limit factors and changed the mortgage insurance premium structure last fall. Before that decision, RMF identified competition with the home equity line of credit option as a major area of growth, given the Home Equity Conversion Mortgage’s relatively lower upfront costs.

Continue reading →

As reverse mortgage volumes have decreased since last year’s principal limit changes, moving to a bigger lender is an attractive option for some independent originators.

Mario Martirano, a 25-year industry veteran, recently made the move to American Advisors Group after feeling the current stresses of a small business owner. Although he is still getting settled, he said he is already seeing those headaches disappear because of the dedicated departments, channels, and resources he never had when he owned his own company.

“I don’t have to worry about marketing, auditing, compliance,” he said. “I’m doing what I do best, which is dealing with the people directly. And now I have backing of a big name.”

Continue reading →

The Federal Housing Administration this week again extended the timeline for reverse mortgage foreclosures in territories affected by Hurricane Maria last year.

All Home Equity Conversion Mortgage foreclosure timelines will be extended through August 16 in the Presidentially-Declared Major Disaster Areas (PDMDAs) in Puerto Rico and the U.S. Virgin Islands — which cover the entirety of both territories.

“It applies to both the initiation of foreclosures and foreclosures already in process on HECMs that become due and payable for reasons other than the death of the last surviving borrower and eligible non-borrowing spouse,” the FHA noted in its announcement.

Continue reading →

Nationstar Mortgage (NYSE: NSM) this week agreed to pay more than $1 million after the forward and reverse servicer illegally charged borrowers inspection fees.

The Coppell, Texas-based Nationstar — which services Home Equity Conversion Mortgages through its Champion Mortgage arm — passed the cost of property inspections associated with reverse mortgage loans in default directly to consumers through February 2016, according to the office of Maryland attorney general Brian Frosh.

That’s against the law in Maryland, which requires servicers to cover those costs themselves. Nationstar, which now offers its forward mortgage products and services under the Mr. Cooper brand name, similarly charged forward mortgage borrowers for property inspections through January 2014, Frosh’s office claimed.

Continue reading →