Reverse mortgages are a must-have in traditional originators’ product mix, as they widen the broker’s offerings and largely evade the sensitivities of a volatile market, industry experts say in a recent Mortgage Professional America article.
The reverse mortgage market has been booming with forward originators entering the space, as a result of the slowdown of originations on the forward side and the dead refinancing market.
But experts say forward brokers should enter the space in order to offer their clients everything that’s on the table.
“When somebody sits down in front of you and there’s a loan in the industry to be offered to that person, you should be able to offer that loan,” said HighTechLending President Don Currie. “Right now, when it comes to seniors – particularly seniors that are living on Social Security or maybe a pension – they can’t qualify for the traditional loans, and really the reverse mortgage is the only option for them. As an originator, it’s really important that you’re able to place those seniors into the right loan for them.”
Reverse mortgages are also less vulnerable to market fluctuations, said Jonathan Scarpati, vice president of Urban Financial of America’s wholesale division.
“Reverse mortgages are a non-interest-rate-sensitive product,” he told MPA. “Whether rates are up or down, people are always looking for reverse mortgages. And it’s a lot less competitive than the forward industry. You’re probably competing with hundreds of companies versus thousands and thousands of companies that offer traditional mortgages.”
With the coming wave of seniors who will be eligible to take out a reverse mortgage, offering the product will be a “tremendous opportunity to grow your business,” he said.
Read the full Mortgage Professional America article here.
Written by Emily Study