The most recently proposed rule changes for reverse mortgages create uncertainty for the future of the industry, but that isn’t raising the alarm on one lender’s plans for a 47 state expansion this year.
That’s the plan for Tustin, Calif.-based New American Funding, which RMD learned last week is broadening its footprint in the reverse mortgage space with the aid of one of the industry’s prominent technology vendors.
New American Funding maintains a servicing portfolio of $14 billion and funds over $1 billion per month. As a whole, the company employs over 2,100 personnel across its nationwide branches.
Last year, New American Funding finished 2015 with 109 Home Equity Conversion Mortgage endorsements, an increase of 63% compared to the previous full-year total, according to industry data tracked by Reverse Market Insight. Year-to-date through July 2016, the company reports 50 HECMs.
“We’ve been a slow growth, but a steady growth each year,” said Ellen Skaggs, reverse national production manager at New American Funding in Tustin, Calif.
On the reverse mortgage side of the business, New American Funding employs eight team members, including two loan officers the company recently added to handle the “multitude” of calls it receives related to reverse mortgages, Skaggs said.
“Our outside loan reps are getting asked about reverse mortgages and people are trying to find out what these changes to reverse mortgages have done,” she said.
The recently added personnel are currently in the process of obtaining licensing to do business in all of the states where New American Funding has a branch location.
“The volume of business that comes in is greater than one person can handle,” Skaggs said.
As the company expands its reverse mortgage operations, it plans to focus initially on hiring personnel to manage certain high volume regions, particularly in the Northeast, Northwest, Southeast and Texas markets. Eventually, the plan is for New American Funding to have a reverse mortgage presence in every state that the company is licensed to do business on the forward side, Skaggs said.
To aid in the expansion, New American Funding recently adopted ReverseVision’s RVX loan origination software. The technology enables New American Funding to integrate its existing loan origination system, as well as its enterprise customer relationship management (CRM) and lead management platform, into RVX.
Technology is critical for New American Funding’s reverse mortgage growth, since all of the company’s mail and other marketing campaigns come from its enterprise CRM system.
As incoming leads enter New American Funding’s CRM, they are automatically distributed to the appropriate branch. Borrower data from RVX is also shared with the company’s forward loan originators so lenders can use the system’s interface to conduct outreach with borrowers.
None of New American Funding’s forward mortgage originators, however, are allowed to originate reverse mortgages and vice versa for the company’s reverse personnel.
The timing of the expansion plans is interesting, considering the uncertainty posed by the Federal Housing Administration’s pending changes to the HECM program. New American Funding, however, isn’t going to let such market unknowns hinder its growth strategy.
“I don’t think any changes will impair us from doing business,” Skaggs said. “The [HECM] program has evolved radically in the last three years. The biggest change was Financial Assessment, but prior to that, it was the cutting of loan amounts. We survived all of those, and we’ll survive these changes and we will keep growing.”
Written by Jason Oliva