RMD’s Readers Pick a Familiar Favorite Name for the Reverse Mortgage

The good ol’ “Home Equity Conversion Mortgage” label — the official name of the federally insured reverse mortgage since the day President Reagan enshrined the products into law — won RMD’s recent poll about a potential product name change.

When asked to select their preferred name for the reverse mortgage from a list of seven options, the humble HECM took the top spot with 32.5% of the vote, followed by “Other” — an option that allowed voters to suggest their own names — in second place with 26.8%, and “reverse mortgage” capturing third place at 19.6%.

Of the potential new monikers that RMD cooked up in its amateur marketing lab, “Equity Release Mortgage” received the most support with 9.3% of the vote; variations on the “release” branding have proved popular in the United Kingdom, where lenders offer multiple types of “equity release” products. “Home Wealth Mortgage,” a name that plays on the commonly cited fact that Americans hold the vast majority of their personal wealth in the form of home equity, followed with 5.7% of the total ballots cast. Bringing up the rear were “Equity Freedom Mortgage” and “Equity Unlock Mortgage,” which each only captured 3.1%, or just six votes apiece.

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In all, 194 RMD readers weighed in on the issue, and we thank every last one of you for making your voice heard. A special thank-you goes out to the whopping 52 of you who made your own suggestions after voting for “Other”; let’s take a look at some of the best and wildest names that RMD’s readership submitted.

The Traditionalists

  • Equity Mortgage
  • Flexible Payment Mortgage
  • Equity Access Mortgage
  • Home Equity Loan
  • Home Pension Loan
  • Home Balance Fund
  • Equity Release Program
  • Retirement Mortgage
  • Senior Mortgage
  • Equity Flex Mortgage
  • The Flexible Mortgage
  • American Home Income Program
The Catchy Acronyms
  • Reverse Equity Line of Credit (RELOC)
  • Senior Equity Access Mortgage (SEAM)
  • Equity Life Improvement (ELI)

The Exotics

  • Seniorwise Mortgage
  • Deferred Payment Mortgage
  • FHA Equity Line
  • Money Back Mortgage
  • Sleep Well with the Peace of Mind Mortgage
  • HECM: Your Pathway to Financial Help
  • Home Equity Choices Mortgage
  • Forward Thinking Mortgage
  • Dreams Come True Mortgage
  • Happily Ever After Mortgage
  • Lifetime Line of Credit
  • Home Equity Transformation Mortgages

Everyone’s a Critic

  • Call it what you want, but the consumer always brings it back to reverse mortgage
  • HOW TO LOSE YOUR HOUSE
  • Anything that doesn’t have the word “mortgage” in it
  • Should have been changed several years ago
  • You seriously have no idea about the product and americans [sic] perception of it, stay out of the conversation

And we’d be remiss if we didn’t single out our two favorite joke answers.  One voter channeled the spirit of the 2016 British boat-naming contest gone wrong and suggested Reversy McReverseface, while another thought the product might be better off with another name that’s been making mortgage industry headlines in recent weeks: Mr. Cooper. Sorry, Mr. Cooper fans out there — that honorific’s been taken twice over.

Perhaps the most thoughtful response came from reader Gerard Martinez, a HECM loan specialist at HECM Senior Home Financing, Inc. in Orlando, Fla. Martinez wrote an impassioned e-mail arguing for clearer a clearer distinction between the generic term “reverse mortgage” — which, as he points out, can refer to private proprietary products — and the federally insured HECM.

“I explain the difference to customers with the following simple analogy: A lemon is a type of fruit, but a fruit is not necessarily a lemon. Fruits can be bananas, apples, and peaches as well,” Martinez wrote.

“Whereas some other non-FHA reverse mortgage products that have been available — or are currently available — could be considered lemons, I would consider the FHA HECM Refi a peach,” Martinez continued, emphasizing the federal protections and underwriting guidelines that don’t come with private reverse mortgage products.

In Martinez’s opinion, getting rid of the “reverse mortgage” moniker entirely is the only way industry can completely shed the negative associations of years past and focus attention on the most common type of home equity conversion product on the market.

“If you want to help your clients, if you want to make money at this business and have a career you can be proud of, ditch the reverse terminology,” Martinez wrote.

Written by Alex Spanko

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  • How in the world can you call a reverse mortgage a HECM (i.e., Home Equity Conversion Mortgage)? Only HECMs can be called HECMs.

    The lack of logic in this choice goes beyond reason. Only a reverse mortgage insured by FHA is a HECM.

    As the only adage goes: “All elephants are animals but not all animals are elephants. So all HECMs are reverse mortgages but not all reverse mortgages are HECMs.”

    All those who voted for the name HECM should be required to be tested on reverse mortgages before being allowed to originate another reverse mortgage, HECM or not.

  • Calling a reverse mortgage with any name that purports the product to be an equity mortgage is inane. An equity loan means that other liens are in front of the equity loan.

    Equity is home value minus debt. So an equity loan implies that not only does the home have value but there are other loans in place having a higher priority in foreclosure at the time of origination than the equity loan being originated.

  • I love the article Alex. I also love the calling the HECM a HECM and not a generic type of “Reverse Mortgage”. This is how we will fix the negativity of our industry – by calling a HECM a HECM (that is the legal name of the product, as we all know).

    • Tim,

      No one disagrees with calling a HECM a HECM but the largest segment of voters want ALL reverse mortgages called HECMs. That is not only false but terribly misleading.

      You need to reread both the survey and the article above. It is hard to believe you of all people would make the comment you did.

  • How sad…
    The reverse mortgage industry doesn’t want to call the reverse mortgage a…reverse mortgage.
    And we wonder why the public has no confidence in the name, we wonder why the mainstream financial community still has its doubts, we wonder why endorsements have been at such a pathetic level for years and continue to decline.
    Well, we can stop wondering.
    When your own industry has no confidence in the name, why should anyone else????
    Our own worse enemy….

    • Mike,

      Then there is the legal reason to call reverse mortgages, reverse mortgages. The law defines what a reverse mortgage is at 15 USC 1602(cc) and states that all reverse mortgages transactions are nonrecourse transactions.

      If we do not call reverse mortgages, reverse mortgages then how can the consumer have ANY confidence that the mortgage is nonrecourse legally other than from mortgage documents that many simply do not fully understand?

      • Agreed Critic, on all points!

        But it goes further than legality. It just wouldn’t be moral or ethical to try and hide what this product truly is.

        As you said “the industry so wrecked the name reverse mortgage in its early days.”
        So many of our so called “experts” don’t seem to realize it is the industry brought this dark cloud over us and only the industry can get rid of it…

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