If you have been in the reverse mortgage business for the last few years, you have certainly noticed a multitude of changes. If you are new to reverse, you have made a wise decision in choosing to serve the senior population. The reverse mortgage is projected to grow in volume for perhaps the next 20 years. As this product continues to evolve, it is imperative that you keep up to date in order to do the best job possible for our seniors.
In just the last several months, we have gone from a maximum FHA HECM lending limit that was unique to each locality, to a national lending limit of $417,000 and then to a limit of $625,500 for the remainder of 2009. Stay tuned.
The addition of the fixed-rate HECM adds yet another option for the senior. Reverse mortgage clients and originators have benefited as more choices become available and product knowledge increases.
The announcement of capped origination fees, while perhaps not popular with originators, was viewed as a positive step by both the public and senior advocacy groups.
The eagerly awaited announcement of the "HECM for purchase" allows seniors to buy a home that will be the primary residence and make no mortgage payments. They can now live in a home that better meets their needs or perhaps is closer to family members. This is sure to improve the quality of life for those borrowers who choose to take advantage of this program.
Recent restrictions on cross-selling and new HECM counseling protocols have been announced in the interest of protecting the senior borrower.
Volume for March 2009 shows 11,261 HECMs endorsed, up from February, and for fiscal year 2009 the number stands at over 57,000. These figures represent substantial growth for a product that was considered "on the fringe" just a few years ago. With the increased volume and public awareness of the reverse mortgage come additional responsibilities for us as originators. We must always remember that we are dealing with a potentially vulnerable group, and it is imperative that we keep their interests first and foremost at all times.
The combination of the improvements to the reverse mortgage program and the growing senior population make this the best time to represent one of the best mortgage products available.
