Heirs May Oppose Reverse Mortgage Transactions
The biggest opposition a lender will face in the reverse mortgage process is opposition from heirs, one mortgage broker who does these loans told attendees at the National Association of Mortgage Brokers annual convention here.
Patty McGill, who is also a past president of NAMB, said even so, there have only been two instances where family member objections have stopped an application.
When either speaking on the phone for the first time or during the first interview with a potential reverse mortgage applicant, Ms. McGill seeks to learn who will be involved in the decision-making process. It is not just family members but an accountant or lawyer as well. The object is to meet with them as well and get them in from the beginning of the process, in order to counter any objections.
Part of the fear with reverse mortgage is that the borrower would lose control of the house. "I never go with an application in hand" to the first meeting with a customer, she said.
The high closing costs are an issue, along with concerns from the borrower about a growing loan balance. But it all comes down to what are the borrower's alternatives, she said, noting that she starts the process by pointing out a reverse mortgage is not for everyone. She does look at every alternative the borrower has before deciding to push forward with a reverse mortgage.
Confidentiality is important with this process. Some people do not want their family or neighbors to know what they are doing. Ms. McGill said it is important to adhere to that wish. (c) 2006 Mortgage Servicing News and SourceMedia, Inc. All Rights Reserved. http://www.mortgageservicingnews.com http://www.sourcemedia.com