Nov/Dec 2021 RMM

and create liquidity from the embed- ded equity.” The trigger for borrowers could be an adverse health event, a need for additional capital or a desire to preserve equity investments at times when the stock market is declining, as was the case in early 2020. In fact, Glieger had one client who withdrew a significant amount of money when the stock market bot- tomed out last year. Their children were facing financial needs, and the client had a surprise expense that could not be covered with emergency savings, Glieger says. As a result of the withdrawals, the client’s portfolio was unable to continue supporting monthly expenses, which included a mortgage payment. They were in danger of running out of money in less than five years, Glieger says. A HECM allowed them to reduce their expenses and refill a portion of their portfolio, Glieger says. “It helped them get back on track to having a sustainable retirement. Financial plan- ning is a process, not an event. Things happen in your life and in the world at large that can have an impact on your financial independence. It’s critical to use all of the tools you have available to give you the best chance of accom- plishing what you want. A HECM could be the right tool at the right time for certain families.” Beyond the HECM Affluent borrowers also may benefit from private-label reverse mortgages, which can enable owners of higher val- ued homes the ability to convert a larger portion of home equity to restructure and improve financial plans. “It is a welcome addition to our portfolio,” says George Downey, founder of Harbor Mortgage Solutions in Braintree, MA. His firm has been able to offer proprietary reverse loans since early 2020. Now, he adds, the dormant value of housing wealth of more affluent homeowners can be used to eliminate debt payments, improve cash flow and increase near- and longer-term liquidity. This is a unique resource for owners of higher-valued homes and condominiums. “We’ve got several that we’re working on right now, and they are providing solutions that the HECM was not structured to fit.” The higher loan amounts made possible by private-la- bel (jumbo) reverse mortgages enable refinancing that eliminates higher debt balances without incurring burden- some monthly payment obligations. “And, of course, people are living longer, so their financial resources have to last longer,” says Downey, who sees private-label products as appealing to financial plan- ners. In fact, he adds, the ability to monetize frozen home equity to improve cash flow and liquidity needs can be a game changer for informed planners. Mark O’Neil, national sales leader, wholesale and correspondent for Reverse Mortgage Funding LLC, Bloomfield, NJ, says he, too, expects private-label prod- ucts to increasingly gain favor. In September, his company released updates to its Equity Elite® product that lowers the eligibility age to 55. Overnight, he says, his market expanded ten percent. Academics continued from page 19 20 REVERSE MORTGAGE / NOVEMBER-DECEMBER 2021