Non-Profit Turns to Reverse Mortgages to Help Struggling Seniors

With an increasing number of seniors in danger of losing their homes as values continue to fall in many regions, one North Carolina non-profit organization is providing the solution by way of reverse mortgages. And it is starting to see success.

The Foundation For Homeowners, based in Raleigh, North Carolina, provides counseling services to seniors who are facing losing their homes. Through the work of four counselors, the non-profit gains referrals through reverse mortgage companies and helps seniors stay at home through reverse mortgages. The target segment is seniors who may not be able to qualify for any number of reasons, at which point the Foundation For Homeowners reaches in to assist.

“We try to remain the bridge at the time when a home is the most familiar and comfortable place to be,” says Lolita Stevenson, president of the foundation. “We focus only on those seniors that want the reverse mortgage but are not qualifying for various reasons.”

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The foundation is currently counseling between 15 and 20 seniors each month, with a success rate of 70-75% who are able to obtain a reverse mortgage, Stevenson estimates.

That success is predicated on whether the borrower is willing to do the work involved to get the loan qualified, she says, but the foundation can often help to present solutions such as budget restructuring or home repairs, before the senior goes back to reapply. Sometimes the services include working with lenders to make a short sale reverse mortgage happen, although the time frame can be variable.

Through industry referrals and word of mouth, the foundation is poised to gain more counselees, who face a minimal administrative fee of $35 for the services. The funding for the foundation is private, and comes in large part from industry contributions.

“There used to be the opportunity for seniors to subordinate any differences when trying to get reverse mortgages,” says Stevenson, who has reverse mortgage industry experience. “Then the Department of Housing and Urban Development issued a mortgagee letter in 2010 that said they could no longer subordinate.”

The Foundation for Homeowners is working to fill the need.

“We will negotiate with lenders and find funding to bridge that gap,” Stevenson says.

Written by Elizabeth Ecker

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  • This is what the doctor ordered and I am very pleased to see other professionals utilizing reverse mortgages to save senior homeowners from foreclosure. For the past two years I have endeavored to achieve the same ends. I have to admit the Foundation For Homeowners has a pull through rate significantly better than mine so I am going to have to get some pointers. When I began working with homeowners facing foreclosure it was very difficult to attain the expertise and knowledge I needed to accomplish my ends. There is no handbook that spells out how to negotiate with lenders when the homeowners are facing foreclosure and underwater on their mortgages. I learned through trial and error. I would like to see NARMLA establish a database or start a blog for reverse mortgage originators that what to share ideas or learn more about originating reverse mortgages for homeowners facing foreclosure. In the Metropolitan Detroit area foreclosures and underwater mortgages are a huge impediment to our housing recovery. I would be more than happy to share my successes and failures. With the Reverse Mortgage industry begging for a positive brand stories utilizing reverse mortgages to save seniors home from foreclosure could be a marketing coup. We need to spread the word and educate ourselves about the foreclosure process. Saving senior homeowners from foreclosure has been the greatest personal and professional satisfaction I have ever achieved as sales professional. It is the best of capitalism. You do an immeasurable good and earn a decent living doing so.

    • Well said.  I haven’t worked thru any short sale/foreclosure deals yet, but am working with 2 different borrowers now, who will both surely lose their homes if we don’t work this out.  I’ve looked everywhere for education/information and find little to none.  In talking with realtors, they seem to have education available but of course it’s focused on selling a property, so doesn’t actually relate to our situation.  I too would love to see an Reverse Mortgage industry realted blog on this.

      • I have information I can provide you though foreclosure laws vary tremendously from state to state and that is biggest obstacle to obtaining accurate information from the internet or someone not in your state.  I have found several local attorneys that have helped me in that regard. As far as the nuts and bolts of negotiating with the lenders this is no different than negotiating a short sale. There is a web site dedicated to short sales called the short sale daily news shortsaledailynews.com. There is good information that will help acclimate you to the process. Once you have a basic understanding contact me and I can help you refine this for your homeowners utilizing reverse mortgages to prevent foreclosure.gciungan@southwestfunding.com.

    • gciungan,

      At one point I believe NRMLA was gathering such stories.  If you are interested in gaining access to some of those stories check with Marty Bell or Darryl Hicks.

  • If this organization is indeed having that kind of success, then my hat is off to them.

    However, just for completeness, I want to note that The Foundation for Homeowners is NOT at the present time a HUD-approved housing counseling agency.  Their counselors may be wonderful folks, but they are not approved to provide HECM counseling.  Presumably they are referring their clients to approved agencies to receive the actual reverse mortgage counseling, after their counselors have assisted in other ways.

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