Bloomberg’s AARP Investigation Video Posted Online

imageI received several emails from RMD readers asking about Bloomberg TV’s AARP: Making Money, Losing Trust investigation that aired last week. The report investigates why some seniors say this highly respected organization does a better job of working for its own financial well being than theirs.

If you missed the airing last week, you can watch it online at the link below (thanks Beth). 

AARP: Making Money, Losing Trust Video

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  • Although the video was interesting, the content was hardly news. As the piece indicates, Conservatives have been very concerned about not only the economic direction of AARP but also its politics for well over a decade.

    In working with hundreds of non-profit clients over the last 30 years one thing is very apparent, only a limited number of nonreligious tax-exempt organizations started with the intention of being purely non-profit and all zealously guard their tax- exempt status. In fact, when referring to non profits, usually the term “tax-exempts” is used to describe them.

    When the business enterprises of tax-exempt entities become too successful they are usually spun off as “for profit” entities. It seems AARP has been so successful, it has several such entities.

    Unlike other tax-exempts, AARP is an active giant. Imagine publishing a magazine that has a distribution ten times that of most popular magazines. The revenues of AARP are greater than many major U.S. corporations without most of their costs. Its influence extends from Washington, DC to all state capitals. Many seniors give their unwavering support to its political and social positions with little or no thought.

    Peter Bell made a most interesting point in Los Angeles when he asked us at a NRMLA General Session of the 2008 National Convention, how many among us volunteered to provide services with groups like AARP. It was surprising how few of us do this. All of us should take the time to work within AARP to create a healthier attitude not just towards reverse mortgages but even more importantly toward us as originators.

    Working as an AARP tax-aide, it is surprising to see how few of the over 60 volunteers at our training facility know much about reverse mortgages. Many of these people are very influential within their immediate sphere of friends, acquaintances, relatives, and social circles. It seems most have pictured reverse mortgage originators as nothing more than greedy lenders. Over the next three months, I hope several will change their ideas on who reverse mortgage originators are and what we do.

  • If I ever have the money, I intend to publicize a few loans such as this true life loan: A 74 year old man with a 69 year old wife. Making a $974 monthly payment with $1,400 monthly retirement, the wife was washing dishes part time at a local middle school to put food on the table. Because they were forced to refinance their mortgage down thru the years, there was only a line of credit, according to the FHA HECM formula, of about $4,000–enough to paint part of the house, reconnect the pipeing to the commode (disconnected by a couple of idiots who had sold and installed a new washer and dryer in their basement) fix the bathroom utilities (the bathtub was
    plugged, the wife vacumning water out of the tub following a bath) the kitchen sink was pugged, filled with dirty dishes–they were eating out of paper plates, and clean the interiors of the house, filled with huge amounts of clutter collected over a lifetime of living. The Husband was 24/7 in a chair because his
    body was paralyzed on one half of his body–the result of being hit in the head by a claw hammer by a jealous boyfriend of a former girl friend upon his return from a year’s service in Viet Nam. When the man woke up from a coma, and could move about with one arm and one leg, he returned to work for a US Government Service,
    climbing up and down ocean going ships with one arm and one leg for eighteen years intil he slipped and fell and was forced to retire. When I first contacted the man about an FHA HECM, he told me he thought from what he heard, the program was a Government rip off. I said no, please let me come to explain how I thought
    it would help his family. After spending three initial hours with the man and his wife, and seeing the terrible conditions in which good people were living, I shook his hand and put my arm around his wife and said: “We all get depressed in life. you folks need help. You are embarassed about how you are living and don’t want friends to know it. But, folks, let’s face it–you need help. This FHA HECM program will provide the money and STOP your house payment.”
    It took me about a month to clear the housing issues.
    The last time I saw the man he grabbed my hand and squeezed it and said,”Now Nelson, we can use our house payment money to live on. We don’t have to worry about whether we will have enough to eat anymore. Man, you have been a lifesaver.” Damn, did that make all the work worthwhile. However, back at the mortgage compaqny I had a young (in the 30’s) fool tell
    me “Nelson, you are wasting your time doing those types of loans. Takes too much time and sometimes the loans don’t go thru.” I said, “If you in this business just for the money, you should get out of it. No, on second thought, you shoiuld be run out of it.” I’m certain that many other FHA HECM Loan Officers have just such stories to tell; I am NOT alone. Those helping Seniors should be praised, not condemned

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