One Reverse Mortgage Lowers Costs, Offers New Pricing Promotion to Consumers

onereverse.jpgOne Reverse Mortgage announced it’s providing a customizable approach to increase the affordability of reverse mortgages for consumers.

Under the new pricing promotion, each client’s personal situation will be analyzed by a mortgage banker, but through the new program, a special package of promotions will be created. Discounts in the package can include lower interest rates, reduced or zero origination costs or no monthly service fees.

“In recent months getting a reverse mortgage has been challenging due to new restrictions that impact the amount of equity clients can access from their home,” said Jay Farner, CEO of One Reverse Mortgage. “Our new pricing promotion allows us to tailor a package of incentives that most benefit each client’s specific situation and goals. This eliminates the cookie-cutter approach of reducing only a single fee that too often benefit only a small portion of clients.”

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The company says there are several instances where the one-size-fits-all promotions fail consumers and a more personalized approach is preferential. For instance, a client who needs immediate cash may benefit from one promotion, whereas another client looking to simply eliminate monthly mortgage payments with the ability to access their proceeds at a later time would benefit from a much different discount.

“Our approach here is very different, but that is because we pride ourselves on being a different company. We work closely with our clients, help them to define their goals and then provide solutions that allow them to accomplish their dreams. This new campaign is simply an extension of that close relationship we enjoy with each and every One Reverse Mortgage client,” Farner added.

One Reverse Mortgage is part of Quicken Home Loans and is the third largest reverse mortgage lender in the country according to data from the US Department of Housing and Urban Development.

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  • It is so interesting to read that at One Reverse you do not speak to a loan originator, you talk to a mortgage banker. Then there is the personal design issue.

    I am afraid this is just a salesman trying to sell to another salesman. It is a good concept but how creative can they be? If there were 10 variables, this might have some substance. But it ends up just another salesman trying to “outsell” other salesmen.

    “For instance, a client who needs immediate cash may benefit from one promotion, whereas another client looking to simply eliminate monthly mortgage payments with the ability to access their proceeds at a later time would benefit from a much different discount.” It sounds like the two “clients” would benefit from two different products — fixed versus adjustable — rather than two different discounts. But who knows, the illustration is so vague.

    We are sounding more like the forward industry every day.

    • Critic,

      I could not agree with you more on how our industry is sounding more like the other side everyday. I got into the RM side for many reason's but one of which was because it was nothing like like the forward side. It wasn't about interest rates and fees, it was (and still is) about relationships and consulting and filling needs. Luckily I have built and continue to build a network of referral based client's and do not often get caught up in the “bidding war” with these type of sales tactic's but it is both alarming and a little depressing to see so many companies going down this path of being a “Discount” seller. I am all for giving my clients the best available program but I am not into doing this at any cost. As most of the professionals here know it the cost of doing business is going up everyday, the CPU (Cost Per Unit) is well over $1,000 – $2,000 per loan. I know for a fact that this discounted type of sale leads to more incompetent individuals working in the industry because they are not making that much money doing each deal so it has to be done in volume to make up for it which leads to this becoming a “Get em in and Get em out” type of process.
      I really do not see these type's of companies surviving in the long run because I like many, do not believe these types of deals are going to be around forever. And I also do not think that the mass of seniors are ready to start flooding these call centers to give them enough business to cover all the marketing costs that they are racking up. But in the mean time it makes us look less than what we are as professional's. I am hoping that with the new licensing requirements it will eliminate even more of the people who are simply answering the phone and selling what they are told to push.

  • I have never read a more vague piece in RMD before. I have no idea what One Reverse is palnning to do with this and I'm guessing none of their clients will either.

      • The lack of clarity is not your fault, it is One Reverse's fault. My limited experience with them was that they would not even accept a phone call from me because I was calling from New York and they are not licensed in NY. The problem was that I was calling about a borrower located in New Jersey.

  • Those of us in the business know exactly what these folks are doing. In the last 3 months, we have seen more changes in rates and “program options” than we've seen in the last 10 years. Things like, “discounts” (AKA removing servicing fees, reducing origination fees, reducing/eliminating the initial mortgage insurance premium, etc. For example, depending on what “discount” you want to offer on a fixed rate program, you can offer a 4.99%, 5.49%, 5.56% and upwards (depending on what YSP you want). BofA now offers brokers no initial mortgage premium. Then there are the adjustable rate programs which most banks have reduced to 1.75% with an interesting twist thrown in by Wells at a 2.2% with removing servicing fees.and origination fee. The list goes on and on. One Reverse has simply taken all of these options and repackaged them as a new “pricing promotion” to benefit each customer's personal situation. Their marketing strategy isn't rocket science – simply putting a new twist to better accomodate all the options the banks now are offering. Give them credit for a new marketing strategy to get prospect's attention and to divert them away from the competition into their offerings.

    • I think their marketing strategy is ridiculous. They haven't defined any benefits to the borrower, just that they will “tailor” the loan to each individual. Who knows what that means?

  • I'll clear up the confusion.. One Reverse Mortgage is getting killed my Wells/Met/Genworth/BoA.. The amount that they pay for leads through any online source available, and the mass mailings and huge internet and tv promotions takes alot of the profit from their loans. The other large Reverse Mortgage Companies are offering 0 origination and 0 servicing and even some are doing 1/2 price MIP, ON EVERY LOAN.. One Reverse Mortgage cannot do this and still pay their Mortgage Bankers 15-35bps off of the loans they close and still be profitable. So they are spinning this to get some press.. They are not going to lose loans that they have started, so if they come up against competition they will lower costs to meet the competitors quote. What they are banking on is that, the clients DONT ever hear or find out about competitors offering these lower costs and the payoff and the appraised value are all in line so that they do not have to reduce any fees. What else this article is saying is that, they are trying to add benefit by digging deep to find out what the client is wanting to accomplish and tailor a loan to meet their individual needs.. ie; Why take a lump sum with 0 origination and 0 servicing with X company when your only really wanting to get rid of your current mortgage and dont need the additional money left over, One Reverse can offer you an adjustable rate loan @ 2% with 0 servicing (still keeping the origination).. Hoping to sell around the fact that the client is getting less in the end, but trying to do it in a benefit package.. Quicken Loans does this on their forward mortgages.. You call in for a rate and term, they cannot really give you a better rate so they come up with a plan to do a cash out refi and pay off x amount of debt reducing your overall monthly debt but increasing your interest rate on your home. Then they sell around the higher interest rate by telling you that you will save x a month and x every year, and say things to you like do you write your interest rate on your check each month? It's a true sales culture there, but I agree how can it last? The loans they write and close have to be very profitable, due to what they spend on marketing. You have to pay the bankers 15-35bps ie;peanuts ( oh and they push taking all the money at closing on adjustable loans cause the bankers get paid on loan amount at closing not on homes appraised value ) and Dan Gilbert has to be satisfy his investors. Forward mortgages are falling on their face this year, due to the fact everyone that had a 7% interest rate has refinanced to 4.99% and chances are will not be refinancing again for another 3-4years, (if interest rates don't increase due to inflation over 8%). Forward mortgages wrote and closed this year will be 25% of what they were last year. For a forward mortgage company to survive they have to have a huge presence on the ground for any home sales that are taking place however with the 8K buyer incentative, purchases have dropped off the map also.. So Quicken Loans forward mortgage business is in jeapordy, Their reverse mortgage business is sucking wind, the cav's lost the playoff's so the Quicken loans arena misses out on potentially another 12-16 games (huge loss).. From looking at Admin's post I would say that they are receiving compensation. This used to be a product that was a benefit for seniors, not a cash cow for mortgage companies. I can't think of any instances where the fixed rate lump sum product with 0 origination and 0 servicing isn't the best loan out there! It provides the most money available, the rate is fixed.. That loan will pay off any mortgages, and provide the most what if or rainy day funds to the senior.. It's a win-win.

  • I’ll clear up the confusion.. One Reverse Mortgage is getting killed my Wells/Met/Genworth/BoA.. The amount that they pay for leads through any online source available, and the mass mailings and huge internet and tv promotions takes alot of the profit from their loans. The other large Reverse Mortgage Companies are offering 0 origination and 0 servicing and even some are doing 1/2 price MIP, ON EVERY LOAN.. One Reverse Mortgage cannot do this and still pay their Mortgage Bankers 15-35bps off of the loans they close and still be profitable. So they are spinning this to get some press.. They are not going to lose loans that they have started, so if they come up against competition they will lower costs to meet the competitors quote. What they are banking on is that, the clients DONT ever hear or find out about competitors offering these lower costs and the payoff and the appraised value are all in line so that they do not have to reduce any fees. What else this article is saying is that, they are trying to add benefit by digging deep to find out what the client is wanting to accomplish and tailor a loan to meet their individual needs.. ie; Why take a lump sum with 0 origination and 0 servicing with X company when your only really wanting to get rid of your current mortgage and dont need the additional money left over, One Reverse can offer you an adjustable rate loan @ 2% with 0 servicing (still keeping the origination).. Hoping to sell around the fact that the client is getting less in the end, but trying to do it in a benefit package.. Quicken Loans does this on their forward mortgages.. You call in for a rate and term, they cannot really give you a better rate so they come up with a plan to do a cash out refi and pay off x amount of debt reducing your overall monthly debt but increasing your interest rate on your home. Then they sell around the higher interest rate by telling you that you will save x a month and x every year, and say things to you like do you write your interest rate on your check each month? It’s a true sales culture there, but I agree how can it last? The loans they write and close have to be very profitable, due to what they spend on marketing. You have to pay the bankers 15-35bps ie;peanuts ( oh and they push taking all the money at closing on adjustable loans cause the bankers get paid on loan amount at closing not on homes appraised value ) and Dan Gilbert has to be satisfy his investors. Forward mortgages are falling on their face this year, due to the fact everyone that had a 7% interest rate has refinanced to 4.99% and chances are will not be refinancing again for another 3-4years, (if interest rates don’t increase due to inflation over 8%). Forward mortgages wrote and closed this year will be 25% of what they were last year. For a forward mortgage company to survive they have to have a huge presence on the ground for any home sales that are taking place however with the 8K buyer incentative, purchases have dropped off the map also.. So Quicken Loans forward mortgage business is in jeapordy, Their reverse mortgage business is sucking wind, the cav’s lost the playoff’s so the Quicken loans arena misses out on potentially another 12-16 games (huge loss).. From looking at Admin’s post I would say that they are receiving compensation. This used to be a product that was a benefit for seniors, not a cash cow for mortgage companies. I can’t think of any instances where the fixed rate lump sum product with 0 origination and 0 servicing isn’t the best loan out there! It provides the most money available, the rate is fixed.. That loan will pay off any mortgages, and provide the most what if or rainy day funds to the senior.. It’s a win-win.

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