New Retail Reverse Mortgage Leaders Emerge, Call Centers Top List

Big banks no longer have a stronghold on the reverse mortgage market, and those that have made big gains in the retail space are trending largely toward the call center model of loan origination.

The latest Department of Housing and Urban Development monthly data indicates American Advisors Group has grown its volume to the highest level of any lender in August. Based on August endorsement data released by HUD, AAG closed 547 Home Equity Conversion Mortgages (HECMs) during the month, placing it in the top spot for retail reverse mortgages. One Reverse, also utilizing a phone-based retail sales force, closed nearly 500 loans during the same time period.

“Times are changing with who is really stepping out in the industry,” says Richard Mandell, CEO of One Reverse Mortgage. “What we’ve proven and what possibly other lenders are finding is the model we have really does a nice job of catering to seniors that makes it very easy for them to do business. That is not to say there isn’t a place for kitchen table conversations, because there are people who prefer to do business that way. But many [customers] are more comfortable doing business over the phone.”


While One Reverse has exhibited slower growth than AAG, both have seen gains in 2012 with the latter company more than doubling its year-over-year volume through the through the addition of new staff and sales through its Orange, Calif.-based production center.

“The AAG brand and retail origination channel have realized tremendous scale and momentum this year,” AAG CEO Reza Jahangiri said. “We are very happy with our progress as we work to become the top retail lender in the country. Our growth is a direct result of the hard work and dedication of our spectacular team, and we look forward to surpassing our remaining goals for 2012.”

AAG anticipates producing 400 loans per month going forward through its retail channel. The company also operates a wholesale channel, launched in 2012.

There is still room to grow, however, the lenders say.

“The true producers are going to separate themselves,” Mandell says. “I think you will see them separate and take on more market share. With big banks out of the business, lenders are realizing they have to focus on this core business, and that this is a highly specialized product.”

Written by Elizabeth Ecker

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  • I believe there is a place for both the “call center” model and the “kitchen table” model as long as NMLS licensed loan officers are handling all initial communications between lender and borrower. I have been told that there is a practice going on whereby notaries “pretending to be employees of the lender” are going to the borrower’s home to have initial loan documents signed. Any licensed and trained loan officer knows and understands the answers to important questions that arise during the signing process while a notary often times does not have those answers. This practice needs to be evaluated and scrutinized by the industry. I believe it violates the intent of the licensing laws which are designed to protect the interest of the borrower and could present a problem to the industry going forward.

    • Many companies use notaries for initial doc signings as a way to ensure completeness in the application process, not as a representation of the company. I think it is important to distinguish the two. If accompany utilizes a notary service provider, that is not a bad thing….if a notary is pretending to be an employee of the company that they are doing the signing for, that is a problem. I can speak from experience, as a company that does utilize notaries, we ensure that we tell the client that they are NOT a company employee and are NOT there to answer questions, only to confirm that you are in fact the person you claim to be and that we get the docs signed properly upfront. All loan officers handle the document review and answer borrower questions in their entirety. I am not sure why a company would employ a notary provider that impersonates an LO, in my opinion, you are doing your company a disservice if you operate that way. If you train your LO’s properly, whether they are face to face or over the phone, document review is something that should be handled by the LO and the LO alone.

  • Paul,
    The potential for abuse using notaries as LO’s is over the top. I think the industry needs to take a look at the practice.To me it violates the letter and the spirit of the licensing laws. How do you control what the notary says to the senior? What if the senior has a question about a certain document and the LO can’t be reached? Do they have them sign it anyway so they can collect their nominal fee? As an industry we should take a stand BEFORE the regulators get involved.

  • Doing business over the phone works for some homeowners.  Having a notary there to help with the signing should be a bonus and would add a level of fraud protection, as long as the notary doesn’t attempt to answer questions about loan terms.  The applicant(s) can address any questions to their loan officer.  For the record, my company has never used notaries for loan application signing. 

  • Any retail LO who has taken a ‘mail away’ application loves the idea of a notary being present for app doc signing when distance precludes the LO from a FTF meeting. 

    The purposes are to (1) ensure the identity of who is actually signing the docs, and (2) ensure that ALL docs are signed and they are signed in the proper place and in the proper way. 

    This provides a level of protection to the lender from subsequent claims of fraud, and speeds up the process by minimizing the incidence of ‘missed signatures’ requiring that docs be returned to the borrower for signing before processing of their loan can begin.

    This is an endorsement of the practice, NOT the abuse of the practice by notaries impersonating LOs.

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