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Customer Intelligence Blog

Sharing knowledge about gaining and keeping customers

Posts Tagged ‘HECM’

Opportunities in the Reverse Mortgage Market

October 12 2011 by David Hunter

With Wells Fargo and Bank of America pulling out of the reverse mortgage business there is opportunity for smaller players to gain market share. This gain can help in two ways. First, the Reverse Mortgage/HECM market is likely to consolidate further. If you have a great marketing engine for market share gain, this could pay off. Second, is the natural growth of your existing business or the extension of your business into a new product line.

Even though overall endorsements are down, many of the remaining lenders are seeing increased business as they compete for the customers no longer being picked up by the former market leaders. Two things are happening: lenders who formerly only marketed to current clients or affinity prospects are growing their business by moving into the pure prospecting realm, as well as new lenders entering the fray. In either case, to hit the ground running, prospecting is now an even more important component for Reverse Mortgage lenders.

In order to help take advantage of this opportunity, Altair has updated its reverse mortgage model that helps target households likely to respond to an offer for a reverse mortgage. This model was rebuilt using homeowners that opened up new reverse mortgage accounts between January and August of 2011 in order to reflect the most current market conditions. At our standard score cut, the model can more than double the response rate for offers mailed. For more information about this, and other mortgage models from Altair, please contact:

Troy Blackman
Vice President Sales and Marketing
615-468-6821
tblackman@altairci.com

Despite Wells Fargo Exit, Reverse Mortgage Demand Remains Strong says NRMLA

June 23 2011 by David Hadaway

The decision by Wells Fargo to stop offering reverse mortgages was a shock to many in the industry but it doesn’t mean there is little demand for the product according to a statement from the National Reverse Mortgage Lenders Association.

“Reverse mortgages and HECM loans are readily available to seniors as an important tool to help them stay in their homes and to fund their longevity,” said Peter Bell, president of NRMLA. ”The decision by Wells Fargo that it will no longer originate new reverse mortgage loans does nothing to change this. The HECM program remains a relevant tool and the vast need for it continues.”

Further, NRMLA said the demand for reverse mortgages remains strong.

“In fact, the HECM program has evolved to meet the changing economic times with the recent introduction of the HECM Saver, a new product that reduces costs and increases consumer protections. The HECM Saver has been embraced by consumers, and grown steadily since its launch.”

The trade association said it has been working with HUD to develop and implement procedures to undertake a financial assessment of prospective borrowers’ income and expenses to determine their ability to pay taxes and insurance charges after obtaining a HECM or to establish a set-aside of funds to pay such charges.

As RMD has reported, the development of the assessment continues to move forward. Vicki Bott, former deputy assistant secretary for single family housing at FHA told RMD it was about two months away from release in March. NRMLA said it anticipates HUD will be issuing a rule change in the future to provide HECM lenders with the discretion to make these necessary underwriting changes.

“NRMLA will work with all member institutions to ensure the industry has the capacity to process loans for seniors who need them,” said Bell. ”HECM loans are insured by the Federal Housing Administration, and are replete with consumer safeguards. Additionally, the Federal Government insurance guarantees funds will always be available to borrowers, and limits their exposure to the market value of the home.

“Wells Fargo Home Mortgage will be missed by the industry. The reverse mortgage professionals at Wells Fargo have been good corporate citizens, sharing knowledge, business insight, and educational resources. We wish them all the best as they transfer to new opportunities.”

Republished from www.reversemortgagedaily.com.