Reverse Mortgages Provide Credit Union With Nice Source of Fee Income

image Credit Union Journal recently published an interesting article about how Colorado Springs, CO based Ent Federal Credit Union is working with Members Trust to provide its customers access to reverse mortgages.  By working with Members Trust, Ent is able to earn fee income from the reverse mortgage transaction while Members Trust earns an underwriting fee.

According to the article, Members Trust also provides servicing for Ent’s reverse mortgage borrowers because the company currently holds the loans on its books.  "It’s very hard to sell them now. We hope within the next few weeks we can sell them to Fannie Mae," said Jon Paukovich, VP of mortgage lending for Ent,

Members Trust is an interesting company.  Chartered by the Office of Thrift Supervision, Tampa-based Members Trust is a CUSO owned by over 45 credit unions that provides trust and investment services to members across the country, as well as reverse mortgage products to 10 credit unions.


For Ent, the unique mortgage provides a "nice fee income." But the reason it offers reverse mortgages is for the "valuable service" to senior members and to further separate itself from banks, Paukovich said. "While reverse mortgages are heavily regulated, individuals can be preyed upon by unscrupulous brokers. The credit union provides members with a safe environment to conduct a transaction in which there isn’t a lot of skepticism and misunderstanding."

‘Nice Fee Income,’ But Be Prepared To Be Patient (Subscription Required)

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  • What’s with always those “unscrupulous brokers”? Most
    of the young “kids” I see working at my credit union
    don’t know a damn thing about the needs or challenges
    of Seniors. A hell of a way to sell by unjustly knocking others in the Reverse Mortgage Field. When is this Industry going to start a Public Relations campaign to tell the beautiful side of their story?

  • Well said James. It’s poor form sending out a PR to our industry knocking those of us who have been helping seniors for years. Being a broker, bank or credit union doesn’t designate your level of care for your clients.

    Jon Paukovich should consider the fact that touting “nice fee income” seems to lump Ent right with those “unscrupulous brokers”.

    As Rodney said back in the early 90’s…. “Can’t we all just get along?”

  • James, you got that right. Whenever someone summarily points to “those brokers”, often they are trying to deflect criticsm. I’ll put the brokers I know against his people any day of the week.

    Jon, as an industry we are in this together. The goal is to make this industry as strong as possible. It appears you want to cast aspersions on a whole segment of our industry that have been servicing seniors long before you got into this business. By the way, I know of instances where loan officers employed by banks purposely give out wrong information.

    That couldn’t be someone in your bank?……I didn’t think so.

  • Whatever happened to the RESPA prohibition against loan originators paying fees of any kind to any third party. Doesn’t FHA/HUD consider that a kickback and therefore illegal?

  • Funny thing–When in 2007 I took a Continuing Education Course of Ethics to obtain my Washington State Loan Originator’s License, the subject of Referral Fees came up. In the class were amateures like me, some very, very experienced mortgage folks ( long conventional mortgage backgrounds), and a number of Real Estate Brokers who were getting cross-licensed. I wanted to know why I couldn’t give a Senior a few hundred dollars for giving me a lead which resulted in my making a few thousand? Against FHA Regulations I was told. Why I asked? Unfair advantage I was told. Baloney I said. If I wanted to help a fellow Senior I should be able to I said. Later, a Real Estate Broker quietly came up to me to say She got a Referral Fee all the time from a Bank–they operate under different rules. I couldn’t believe it really and still wonder if it is true.

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