Reverse mortgage originators are on the front lines of the industry every day pursuing leads, talking to potential borrowers and directly dealing with any changes that may affect the ways that reverse mortgage products work.
RMD is proud to introduce the new regular feature “Origins,” question-and-answer sessions with originators to learn about what led them into the reverse mortgage industry, what they see happening in the business now, and what they would like to see in it in the future.
In this inaugural edition of the new Q&A series, Rich Pinnell of Guild Mortgage in Redding, Calif. offers his journey to the business and how he would like to see it evolve in the future.
How long have you been originating?
I started in the mortgage industry in 2013, with a forward mortgage company that would also allow their loan officers to handle reverse mortgage business.
How did you first learn about the reverse mortgage product, and what demonstrated that reverse origination was something you could do?
The very first loan that was handed to me was a reverse mortgage purchase, and at the time I didn’t know that product was the hardest reverse mortgage to close in a timely manner. After that first reverse mortgage, I did a few more and found that I liked the outcome for the seniors I was working with. By the end of 2016 I had moved over to the reverse side full time.
What would you say was the earliest big test you found most challenging in your career as an originator?
That first reverse mortgage was, by far, the toughest of all the mortgages that I have closed, either on the forward or reverse side.
What is your most unusual case that you’ve had to deal with in your capacity as an originator, and how did you solve it?
Again, I go back to that first reverse mortgage. The first conditions report I received from the underwriter had 47 conditions to clear, of course there were a few boilerplate items like, ‘make sure the proper lenders name appears on the deed’ (the normal stuff). But, there were 13 conditions – each – on the borrowers, the appraisal inspection and the way the contract was written.
All of the borrowers’ documents had been loaded into a trailer because they had already sold their home, so things like copies of leases for their investment properties were not available. How it was solved came down to lots of patience by the sellers and my clients, and a few very intense phone calls.
Oh, also, did I mention that the home that my clients were buying was 500 miles away from our offices?
What would you classify as your biggest accomplishment in your work as a reverse mortgage originator?
As I learned both the forward and reverse side of the business, I learned that the most important thing you could do for your clients is to keep them informed as to what’s going on. While the process seems simple to us, the client doesn’t understand why we can have delays in needing more information/documents as we go through the steps.
When I reached the milestone of being eligible to apply for my CRMP, I was ready to take that next step. To me, it’s very important to, first, be an educator on the reverse mortgage product offerings. Only when that part of the process is completed am I interested in originating a loan. I like the company I keep by being a CRMP.
What do you think is needed for potential borrowers to be more fully educated about home equity release?
Well, it won’t be more TV ads. While there is nothing wrong with sparking interest with the ads, it really does a disservice to the clients in expecting them to understand a reverse mortgage with a CD and a packet of information.
There hasn’t been a single client that wasn’t benefited by a personal visit from a reverse mortgage loan officer. I don’t know the answer to getting a client educated without sitting with them and understanding their ‘needs and wants,’ not to mention the chance to see the property that we’ll be inspecting for value.
Where do you see the reverse mortgage industry in 5-10 years?
Since we have no control over what HUD/FHA might do going forward, I really don’t have a feeling of what might happen. If something like reverting to pre-October 2017 PLFs were to happen, then origination would go through the ceiling.
While I don’t see that happening, the reverse mortgage market will still be strong and moving forward because so many seniors need the product. That is not going to change because retirement income is not keeping pace with seniors’ needs.
What is the industry’s biggest challenge today, and how can it be overcome?
Education and overcoming the myths surrounding reverse mortgages. In my view, it will always be a toe-to-toe – or kitchen table – product. If we are to grow the industry, it will come from more of us working directly with seniors so they will truly understand that product and how it’ll affect their retirement years.
Of course, that means it will take a loan officer more time to handle each loan, but there should be no reason why an officer can’t handle 4 or 5 reverse mortgages a month under that workload.
Complete the sentence: If I could change one thing about the reverse mortgage it would be: __________
I think all of us that are full-time on the reverse mortgage side, would say: ‘to go back to pre-October 2017 PLFs.’ Those PLFs allowed us to help many more seniors. I would add that if we did go back to those days, it should be with reductions in the commissions being paid with those higher PLFs.
If I could erase one reverse mortgage misconception it would be: __________
That the bank owns the house, or takes the house when [a borrower] dies.
Do you know an originator who would like to be featured in our Origins series? Send an email to email@example.com, and let us know!