Top-10 Lender Brings Reverse Mortgage Education to Capitol Hill

For the reverse mortgage industry, opening the lines of communication between financial advisors and other senior service professionals can raise awareness of the importance of home equity in retirement planning. With the aid of several reverse mortgage originators, one top-10 industry lender took its educational efforts straight to the nation’s capital.

Assembling a diverse group of Home Equity Retirement Originators, San Diego-based Retirement Funding Solutions (RFS) made the trip to Washington, D.C. last week to participate in the NAIFA Congressional Conference.

“We find ourselves at a crossroads,” said Chris Kargacos, senior vice president and national sales leader at RFS. “Our industry is changing for the better. As the market changes, one thing is still constant: there is a huge misconception about the reverse mortgage industry and how we help people.”


NAIFA, which is an acronym for the National Association of Insurance and Financial Advisors, represents licensed life insurance agents and financial advisors through its federation of more than 900 state and local associations throughout the United States.

The organization’s Congressional Conference provides NAIFA members with a platform to communicate their expertise and concerns to their elected officials. The event also serves as an opportunity for members to build new relationships and strengthen existing connections with these lawmakers, in efforts to establish a basic level of education among all members of Congress about the value of financial products and services critical to retired Americans.

For RFS, which is active with NAIFA in several markets, including California, Colorado and Florida, attending the Congressional Conference was an opportunity to create new relationships in the markets the company represents. The partnership between the two organizations began about 2-3 years ago.

An overarching objective of NAIFA members is to promote financial literacy to their clients, largely middle America—a demographic that, as a result of more stringent underwriting requirements and other program changes in recent years, has become a prime candidate to use a reverse mortgage as a retirement planning tool.

“The reality is we are facing a retirement crisis as a nation,” Kargacos said. “When looking at the new customer profile, home equity can be a viable solution to help people achieve the retirement they deserve.”

NAIFA’s commitment to retirement security for Middle America aligns with research published by members of the Funding Longevity Task Force on the key role home equity can play when incorporated into a coordinated retirement income plan.

“It is encouraging to see the reverse mortgage align with a group that serves 75 million American families,” said Shelley Giordano, chair of the Funding Longevity Task Force. “This outreach cannot help but to dispel rampant misinformation and lack of attention to home equity, that is, sadly, the norm for retirement planning in our country.”

Home equity continues to gain status as an alternative asset in retirement planning, particularly for the middle segment of retirees who have the household wealth that could be used strategically to preserve other investments. A lack of education, however, continues to be a challenge in raising awareness of home equity and the strategic use of reverse mortgages in retirement, not only for retirees but their trusted advisors and other professionals as well.

“We, as an industry, need to become more involved with educating our policymakers on the real impact that this program can have on our borrowers and the nation’s retirees,” Kargacos said.

Written by Jason Oliva

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  • Why are we so “all in” as an industry when there has been no pragmatic testing of the model through to its conclusion? It is a lie to say anything has been proven; yet it has been demonstrated that there is a high degree of likelihood it will work. But then there was a high degree of likelihood in 2005 that we would never see anything like the Great Housing Depression of 2008.

    It was interesting to watch Mr. Mark Cuban Friday night on Shark Tank attack over not having any clinical studies on a product called Pavlok despite its promoter claims. We do not have that either. Like those attempting to get a patent we have some design and modeling that indicate it should work in the real world. Yet we have no controlled testing to show it does.

    Mr. Maneesh Sethi was well prepared, had a great spiel, knew his product, had evidence that the underlying concept worked and worked well but lacked one thing, clinical trials of Pavlok. While the main thing that has been most commented upon by the press is the interchange of Mr. Sethi and Mr. Kevin O’Leary followed by the support of the other sharks to Mr. O’Leary, it was Mr. Cuban who led the way in uncovering why the investors should not rely on the product being able to perform in the manner indicated. Mr. Cuban never said it did not work but rather that it could not be relied upon to work.

    Beyond the “true believer” passion we see being championed in our industry today, there is still the problem of not having seen any increase in endorsements and expecting no real increase this fiscal year at all despite claims like HECMs are being adopted into retirement planning more and more or the HECM is being seen as a much safer and more consumer friendly product.

    Then we faintly hear the experience of most HECM originators that acceptance that does not grow the more that they meet with financial advisors to the product. What national sales leaders want to believe is true simply is not. Without “clinical trials” and detailed analysis of the benefit of the HECM following termination, our arguments and claims sound more like Mr. Sethi than Mr. Cuban.

  • I read this article and liked what I read. I also read RMAdvisor’s comment.

    I am not saying what RMAdvisor is saying does not hold water, on the contrary. However, what I am saying is that we have to start somewhere, we have to test the water and I feel this is just what Chris Kargacos, senior vice president at RFS and his company as a whole is and have been doing!

    NAIFA members represent a large number of financial planers/advisors all over the country. To interface with them as Chris Kargacos and others from RFS did at the congressional conference only opens up more opportunities for all of to test the new found market.

    Yes, things are changing and changing fast in our industry, we need to move fast to keep up with the changes or we will be left behind!

    Sure, it will not be easy for all of us to immediately change our mode of operation but we don’t have a choice. We have to start making the move.

    RMAdvisor is right about no true proven test results but we must start getting the testing process moving forward. I have a great deal of respect what RMAdvisor has to say, I am not criticizing the comment in any means of the imagination.

    However, we must understand and learn as much as we can about how financial planers go about planning their clients financial strategy for life. It is so important for us to understand this if we are going to capitalize on this new potential bank of business for us!

    I keep saying this but change is here, we have to embrace it and go after additional new markets to establish our on going business base.

    I do know this, the publicity, the write ups and quotes by many financial professionals about the reverse mortgage product is not hurting us in the least!

    Articles and quotes in highly recognized publications like “Forbes” magazine have been numerous lately! These articles are from respected financial professionals and they are talking about how financial planers and advisors are looking at the reverse mortgage as one of their retirement planning tools.

    This could be a Golden Goose on a plate from heaven being handed to us, providing we know how to go about taking advantage of it!

    John A. Smaldone

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