July-Aug 2020

Talking Heads mortgage business today. Reverse mortgages are going to get bigger and better for us, because we’re taking the time to do it right. RM: Why should forward mortgage lenders embrace reverse mortgages as a viable product line? LM: I’ve originated mortgages for almost 35 years and, for much of that time, I’ve been doing reverse mortgages alongside forward mortgages. If you don’t offer reverse mortgages as an option for your clients, then you’re doing them a disservice. I’ve always looked at my clients from what serves them best, either a traditional forward mort- gage or a reverse. RM: What attracted you to reverse mortgages in the first place? LM: I was at my hairdresser. She’d just turned 62. She owned a major piece of commercial real estate and a salon. She had a financial planner. She sat me in the chair, and I almost lost part of my ear when I suddenly jerked my head after she said, “I want a reverse mort- gage.” I said, “You don’t need a reverse mortgage.” The way the conversation went introduced me to the notion that a reverse mortgage is a tool that everyone should look at when they’re doing a retirement plan. She lived in a property that was free and clear. Long story short, we were able to set up the reverse mortgage, so that she could loan her business funds to pay off some expensive commercial debts. When these loans were being done in the 90s, they were used to help people stay in their homes. She introduced me to a whole new world. I’ve been working with financial planners ever since. RM: Tell about me loanDepot’s technology. What makes it so special? LM: We provide loans for our customers with reduced work on their part. The technology gives us access to infor- mation that we normally would have had to gather from a client in the form of paystubs and W-2 statements. Once I have someone’s credit report, I can verify their income a certain percentage of the time. I am also getting prop- erty inspection waivers. loanDepot’s technology provides a better borrower experience without giving up the rela- tionship part of that experience. It allows me to spend less time on the paperwork and more time with my borrower. RM: And you’re able to adapt this software so that your reverse mortgage clients benefit? LM: At times, yes. loanDepot is currently a TPO [broker] for our reverse mortgage business. We work hand-in-hand with the top investors in the industry to utilize our technology whenever we can. The reverse mortgage industry itself has not caught up to this tech- nology. We collect information a certain way that the U.S. Department of Housing and Urban Development (HUD) accepts on the forward side but not reverse. There are so many ways we can reduce the amount of work that reverse mortgage borrowers must do and give them a better experience. We push on that end. We pro- vide information that gives our investors what they need to make a great decision. It’s about pushing technology- provided information to be acceptable. Some investors are better on that front than others. We have so many ways for borrowers to comfortably communicate with us, to send us information securely, and that alone has changed how business is done in the reverse mortgage industry. RM: Compared to the forward mortgage world, the reverse mortgage industry has very few technology pro- viders. Why is that? And what can be done to attract more of them into reverse? LM: It depends on the technology. The first thing that needs to happen is for HUD to say it’s okay. When that happens, technology providers will run to this industry. We need to get to the point where we can run auto- mated underwriting on these loans, where HUD accepts property inspection waivers much like Fannie and Freddie do and digital verification of employment. It’s not just the technology, some of the underwriting itself needs to change. There are so many differences between what HUD allows on forward mortgages and what it allows on reverses. For example, on Federal Housing Administration forward mortgages, you can pay off debt Talking Heads continued on page 14 REVERSE MORTGAGE / JULY-AUGUST 2020 13