Sabra Richens entered the mortgage business in 1986. She has worked in many different areas, including servicing, collections and foreclosures. After joining Salt Lake City-based FSI Mortgage in 1999, reverse mortgages caught her attention and she has specialized in offering them ever since. FSI Mortgage is also one of NRMLA’s longest continuously supporting members having joined the association in 2002. Weekly Report sat down with Richens to reflect on the past 20 years selling reverse mortgages.
Weekly Report: How are you achieving success in today’s market? Has the conversation changed at all between you and you clients in terms of helping sell the product?
Sabra Richens: Selling reverse mortgages has never been an easy job, however, reverse mortgages have not changed as far as the product itself and the great guarantees it offers. The downsides to reverse mortgages are also still consistent. This makes our “sales pitch” about the same as before even though the funds available and product offerings are much more diverse than years ago.
WR: What is your favorite reverse mortgage story?
SR: Speaking for myself as a loan officer, all of them are my favorite stories. From the people who would have lost their homes, to those who fund grandkids’ college tuitions or weddings, or those who buy RV’s to travel, or pay all their bills off, each has been special in its own way. I cannot pick one, however, each one is an ultimate success story. In listening to our loan officers in our quarterly training workshops, I find they have the same opinion. It’s amazing to me that we can remember all our clients since 1999 simply by hearing their name or talking with them on the phone.
WR: How do you handle the objections surrounding not enough money, the fees are too high, I want to leave it to my kids?
SR: First, NO mortgage, unless you are obtaining a VA loan, will lend 100 percent of the value of the home. When we explain to our prospective clients that they are loaned a percentage of their value based on their age and that it can never be 100 percent, that seems to diffuse the “not enough money” or “you’re taking all of my equity” questions. The “fees are too high” question is easily explained by comparing the closing costs of a forward FHA mortgage and a HECM. They are so similar, but the difference is that a forward loan’s costs are paid over a 30-year period, while a reverse mortgage loan’s costs are all paid in a lump sum. However, the borrower is not required to pay them in cash up front, so that usually resolves that issue for our borrowers. As for wanting to leave the home to the heirs, we do explain that the heirs will still inherit the home, only in a reverse mortgage, it may not be as much as they would have received if they kept their regular mortgage in place or had no mortgage at all. We try to explain that although this could be a downside to doing this loan if this is what they planned on leaving their children, it will also help them to be independent instead of needing help from their children or going without. We explain that since they have had the foresight to stow away enough equity in their home that they can now live financially independently because of their planning. That will usually cover anxiety over leaving property to the heirs. We also explain that any equity remaining once the estate sells the home will be the heirs’.
WR: How are you approaching proprietary reverse mortgages?
SR: Since the states we are licensed in have property values that are somewhat less than other states, we have not had much need for the proprietary product yet. However, we are just completing our first. We are hopeful to see an increase in the product, but it is still new to us. We included training for using the product in our April quarterly training, presented by an RMF AE in an extremely enlightening class. Our loan officers seem quite anxious to use it as a product in their comparisons going forward.
WR: What is one (positive) take away for the coming year?
SR: The positive take away that is consistent in our company is that reverse mortgages, since we started doing them in 1999 and to this day, are a tremendous option available to the older homeowner to provide a better, happier, more comfortable life. We are proud to provide this as an option in our mortgage offerings and truly believe in the benefits it provides.