A common frustration exists among reverse mortgage professionals when it comes to equipping potential borrowers with good, accurate information about their products.
It isn’t that borrowers aren’t open to learning about the loans, but they sometimes come to the table already having been turned off by news articles or misinformation presented by mainstream media or political figures. While they are small in number compared with the major media networks reaching millions across the nation, lenders and originators agree it is essential to work toward changing the false notions out there—one borrower, newscaster and politician at a time.
“Misinformation and disinformation are hurting our industry and the borrowers we would otherwise be helping who are not considering our product because of fear,” says Jeff Lewis, founding member of the Coalition for Independent Seniors and chairman of Generation Mortgage. “We need to counter the negative press, negative statements by advocates and politicians as well. If we don’t, who will?”
The timing of the housing crisis and financial meltdown hasn’t helped, says George Downey, founder of Braintree, Mass-based Harbor Mortgage Inc. “The preponderance of the press has been negative in the wake of the mortgage meltdown and subprime crisis. Unfortunately, many articles have been writing with misinformation and a rehash of old information that has already been printed. It has a similar effect on regulators and legislators.”
A recent National Reverse Mortgage Lenders Association study aims to provide an accurate response of current reverse mortgage borrowers, as well as the response from potential borrowers and their children. The results of the survey, Downey says, are overwhelmingly positive, with a more than 90% reporting satisfaction of the loans. Using the NRMLA study and other positive information is one way to address the inaccuracies surrounding the product.
“Collectively, the industry is constantly trying to disseminate good information. If there are 1000 media outlets and one NRMLA, how many times can the association respond? We’re better off to keep educating on the right information rather than trying to fight misinformation,” says Michael Gruley of 1st Financial Reverse Mortgages..
But drawing attention to the negative press can be an unwanted result whenever the question of misinformation comes up.
“We don’t wrestle with the pig,” says Gruley. “We try to correct errors, but the more we engage ourselves in trying to correct, the more we shine light on it.”
Downey says he engages potential borrowers, instead, and asks them about misinformation about the product when he encounters it.
“In talking with people who have these [negative] feelings, I think the better response is, ‘That’s interesting. Why do you say that?’ Then draw them out as to what it is that led them to that conclusion. What I find out almost 100% of the time, is they don’t have specific facts, or they have misconceptions. Generally speaking, it’s what they heard somebody else say.”
The hope is that when reverse mortgages become more mainstream, the education will become easier.
“We believe seniors are starting to ignore it,” Gruley says. “I suppose, in time, we have to hope the truth will prevail rather than fight all the naysayers.”
“One day, this will be a mainstream product, but it isn’t right now,” says Downey.
Written by Elizabeth Ecker