Texas recently celebrated a series of milestones, including having issued 60,000 Home Equity Conversion Mortgages (HECMs) in the state and converting more than $4 billion of home equity, just months before its annual Reverse Mortgage Day conference.
The last state to authorize reverse mortgages, the Lone Star State has now converted roughly $4.5 billion worth of home equity into retirement funding since the Texas Legislature amended the state’s Constitution to allow senior homeowners to begin using HECMs in 2000, according to the Texas Mortgage Bankers Association.
Since then, 60,000 Texans have benefitted from HECMs, signaling a growing acceptance of reverse mortgages throughout the state among both borrowers and lawmakers, says Scott Norman, vice president of national field retail sales at Urban Financial of America.
“Before 2000, Texas was the only state in the country without this important financial option available to senior homeowners,” Norman says. “Now, as older Texans are forced to deal with expanding health care costs and stock market fluctuations, they can consider a reverse mortgage as a viable tool for their financial and retirement planning.”
While Texas’ unique homestead laws have previously been an obstacle preventing statewide reverse mortgage use, these regulations along with strict compliance standards embedded within the state’s Constitution help ensure the safety of HECMs and their impact on borrowers.
Being the last state to allow reverse mortgages has had unintended benefits, one of which was having a “unique vantage point” to look around the country and gather legislation based on what other states have done, Norman says.
“History has shown that not only is a reverse mortgage in Texas the most consumer-friendly, but it’s also one of the most regulated mortgages in the entire country,” he says.
In fact, the state’s chief mortgage regulator, the Texas Department of Savings and Mortgage Lending (DSML), has not issued a single enforcement action against reverse mortgages over the last six years, nor does the agency have any pending complaints or investigations involving reverse mortgages at this time, the regulator confirmed in response to a request for information filed by Norman.
Texas currently holds a 7.4% national market share of all reverse mortgages in the country, making the state the third-largest market for the product, according to industry data from Reverse Market Insight.
To help celebrate 15 years and 60,000 reverse mortgages in the state, the Texas Mortgage Bankers Association will host the 15th Annual Reverse Mortgage Day conference on Wednesday, Sept. 9, at the Driskill Hotel in Austin.
The annual forum will bring together reverse mortgage lenders, secondary market experts, real estate attorneys and bank executives from across the country to discuss the policies that will affect reverse mortgage lending in the future.
Areas of discussion at this year’s event include Financial Assessment (FA) updates; sales and marketing techniques for loan officers; best practices for streamlining workflow post-FA; as well as the future impact and challenges for the HECM program.
Attendees can also expect a public policy discussion on the FA featuring speakers from the Department of Housing and Urban Development (HUD), along with a variety of breakout sessions that will explore additional facets of the FA, including early results and what the reverse mortgage industry has learned following the rule’s implementation, Norman says.
What originally started as a conference designed for reverse mortgage originators, the annual Reverse Mortgage Day event has grown to appeal to a variety of industry stakeholders, including but not limited to government officials, attorneys and title companies, among other professionals from across the country.
Last year, more than 130 lenders, attorneys and service settlement providers from 17 different states attended the annual event.
“It’s no longer a Texas-only or an originators-only conference,” Norman says. “Attendees will hear more about what FA is looking like at other companies and what people are seeing and hearing. It’s really going to be a public policy discussion on what’s happening to the product today and in the years to come.”
The 15th Annual Reverse Mortgage Day conference begins with a cocktail reception on Tuesday, Sept. 8 at 5:30 p.m. at the Driskill Hotel.
More information about this year’s event, including a tentative conference agenda, can be found here.
Written by Jason Oliva