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From the Top Ed Robinson, president and chief operating officer, American Advisors Group By Darryl Hicks 12 Those We Help Reverse mortgage provides ‘lifeline’ for parents, then son By Darryl Hicks 32 September–October 2022 Volume 15, No. 5 Contents CRMP: Across the Kitchen Table A chat with Greg Gianoplus, CRMP, channel leader, HECM Banking Division, Alpha Mortgage Corp. By M. Diane McCormick 16 Features 20 Helping Reverse Mortgage Borrowers Impacted by COVID A Guide to the HAF Program By Joel Berg 24 Grow Your Business Through HECM for Purchase Experts discuss evolution of niche market By Joel Berg 28 Advertising Rules Explained Attorneys: Companies must know rules and ethical guidelines By Thomas A. Barstow Columns 3 In Reverse News you can use to build your HECM business By Thomas A. Barstow 5 Steve Irwin: Moving Forward Let’s work to better explain how our products work 6 Board Room With reverse mortgages, it’s all about originators, originators, originators! By Jim Cory Departments 2 Scribes Meet this month’s contributors 8 What’s News Get up to date on the industry, the press and Washington, DC 34 Member News/Who’s Who in Reverse 36 Numbers Report details increasing senior home equity PUBLISHER Peter Bell pbell@dworbell.com SENIOR EDITOR Thomas A. Barstow thomas.barstow@theYGSgroup.com ASSOCIATE EDITOR Darryl Hicks dhicks@dworbell.com MANAGING EDITORS Sam Hoffmeister samuel.hoffmeister@theYGSgroup.com Therese Umerlik therese.umerlik@theYGSgroup.com MANAGING EDITOR, DWORBELL, INC. Jessica Hoefer PRESIDENT Stephen Irwin NRMLA EXECUTIVE COMMITTEE CO-CHAIRS Scott Norman, Finance of America Reverse Michael Kent, PHH Mortgage Corp. dba Liberty Reverse Mortgage DESIGNER Emily Graf ADVERTISING SALES Natalie Matter Bellis natalie.matterbellis@theYGSgroup.com Reverse Mortgage is the official publication of the National Reverse Mortgage Lenders Association. The magazine is published every two months. For inquiries regarding association membership and/or magazine subscriptions, please call Darryl Hicks at 202-939-1784. Advertising and editorial inquiries should be directed to Megan Brodbeck (megan.brodbeck@ theYGSgroup.com) and Sam Hoffmeister (samuel.hoffmeister@theYGSgroup.com), respectively. Association & Subscription Contact: National Reverse Mortgage Lenders Association 1400 16th St., NW, Suite 420 Washington, DC 20036 202-939-1760 lross@dworbell.com Industry: www.nrmlaonline.org Consumers: www.reversemortgage.org Advertising & Editorial Contact: National Reverse Mortgage Lenders Association 1400 16th St., NW, Suite 420 Washington, DC 20036 202-939-1760 ©2022 National Reverse Mortgage Lenders Association
Scribes Meet This Month’s Contributors he later sold. Since 1998, he has been a member of NRMLA and currently serves as vice chair of its Board of Directors and chair of its Education Committee. He also participates on NRMLA’s Ethics Committee. Cory is a graduate of Penn State University. His interests include history, humor, reading, sports and fitness. Darryl Hicks (From the Top, p. 12, and Those We Help, p. 32) joined NRMLA in May 1999 and currently serves as vice president, communications. Hicks writes the Weekly Report newsletter, administers NRMLA’s social media accounts and websites, and manages the CRMP designation. Steve Irwin (Moving Forward, p. 5), president of NRMLA, oversees the association’s initiatives to serve as an educational resource, policy advocate and public affairs center for consumers, lenders and related professionals. His background includes experience with strategic planning, organizational design, portfolio acquisition, risk management and quality control. He received his B.A. from Grinnell College and his MBA from the University of San Francisco. M. Diane McCormick (CRMP: Across the Kitchen Table, p. 16) is a freelance journalist and former legislative press secretary. She covers issues involving a variety of national business associations as well as basic and higher education. Her 2017 book, Well-Behaved Taverns Seldom Make History, explores Pennsylvania pubs where rabble-rousers stirred up trouble, from the American Revolution to Prohibition. Thomas A. Barstow (In Reverse, p. 3, and Advertising Rules Explained, p. 28,) is the senior editor for Reverse Mortgage magazine. Barstow has had a 37-year career in journalism that includes being a reporter, writer or editor in Maryland, North Carolina, Pennsylvania and New York. He currently teaches journalism at Gettysburg College and writes for various business publications. He is a former president of the Pennsylvania Society of News Editors and the Associated Press Media Editors in Pennsylvania. Joel Berg (Helping Reverse Mortgage Borrowers Impacted by COVID, p. 20, and Grow Your Business Through HECM for Purchase, p. 24) has been a business-to-business reporter and editor for more than 20 years, covering finance, healthcare, environmental regulation and general business news for local, regional and national publications. Most recently, he was editor of the Central Penn Business Journal and Lehigh Valley Business in Pennsylvania. He taught writing and communications at York College, Millersville University, Gettysburg College and Harrisburg University. Jim Cory (Board Room, p. 6) is a mortgage entrepreneur with 25 years of experience building high-growth companies in the reverse mortgage industry. He is managing director in the reverse mortgage division at Cherry Creek Mortgage. Cory has held a variety of senior leadership positions at several mortgage companies, including Open Mortgage, Live Well Financial, Seattle Mortgage and, most notably, Fannie Mae. In 2008, he also founded Legacy Reverse Mortgage, a mortgage originator that Financing Seniors’ Independence ServingUtah and Idaho for Over 20Years We opened our doors in 1999 to provide local homeowners and those wishing to be homeowners good quality mortgage loans with no hidden surprises or costs. We pride ourselves on being customer oriented and find loans that are tailor made for our clients. We added the reverse mortgage loan to our great line of product offerings and have been providing the people of Utah and Idaho this loan as another mortgage available to meet whatever financial need arises. We continue to remain committed to our clients’ mortgage financing needs, and our variety of all residential mortgage loan products makes us a great company to add to your network of professionals. FSI Mortgage Independence Square 111 East 5600 South • Suite 102 Murray, UT 84107 • NMLS #4398 www.fsimortgage.net 1-800-808-3066 2 REVERSE MORTGAGE / SEPTEMBER–OCTOBER 2022
In Reverse News You Can Use to Build Your HECM Business By Thomas A. Barstow IN THIS ISSUE, we look at several current events, including a pot of money—the federal Homeowner Assistance Fund (HAF)—that was created as part of the American Rescue Plan Act to help homeowners who fell behind with their mortgages during the pandemic. Writer Joel Berg outlines how states—each got a piece of the pie—have been getting the money and largely allocating the relief to people with forward mortgages. Helping Reverse Mortgage Borrowers Impacted by COVID (p. 20) explains that efforts are underway to educate decision-makers about why HECM borrowers also might need relief, such as those who fell behind with either taxes or insurance payments during COVID-19. The process has not been easy because of some of the same problems that reverse mortgage companies historically have had in getting people to understand how these complex financial products work. Efforts at expressing the importance of HECMs become even more critical during a crisis, particularly when help is there but new assistance programs still are being created. As we all know, in normal times, your clients often are vulnerable because of their ages, and that situation has been more tenuous for a population most susceptible to COVID-19. Mortgage servicers are on the front lines with customers after a reverse mortgage closes and have been monitoring HAF developments on a state-by-state basis. However, everyone can help, including loan officers who have been originating reverse mortgages before, during and after the pandemic. If they can take the time to learn what their states are doing with HAF, they can be a point of contact for clients while providing service and stability for reverse mortgage products in the long term. At the least, reverse mortgage professionals will demonstrate how the reverse mortgage industry cares about its customers and the communities where they operate. As outlined in previous editions of this magazine, reverse mortgage companies and workers should engage with regulators and elected officials before a crisis to build a foundation of trust for educational groundwork. However, now is as good a time as any to start. People truly might need your help. Advertising and Marketing While NRMLA and other stakeholders have been working with government officials to fine-tune the HECM program for decades, the work can be frustrating because it requires constant diligence. Perhaps no issue is more emblematic of that dynamic than the regulations surrounding marketing and advertising. Earlier this year, we reported on regulatory developments during the Biden administration. In this In Reverse continued on page 3 REVERSE MORTGAGE / SEPTEMBER–OCTOBER 2022 3
issue, we get into some of the details behind NRMLA’s “Code of Ethics & Professional Responsibility” and how it correlates to real-world regulations coming from state and federal agencies. The article Advertising Rules Explained (p. 28) centers on a presentation by James M. Milano and Joel Schiffman, attorneys with Weiner Brodsky Kider PC, who have helped develop NRMLA’s code of ethics. Over the years, they have created what they call “The Dirty Dozen,” which provides guidance on best practices for complying with marketing and advertising rules. They outline some of the common pitfalls and mistakes that lenders make when trying to increase their sales, whether they are using their own marketing and advertising materials or promotions created by third parties. Frankly, Milano points out, “it’s no excuse” if a third party creates a campaign on your behalf and you have not properly vetted it. HECM for Purchase Another challenge this year has been the rising interest rates and how best to adapt. Previously, we touched on how the HECM for Purchase can be a terrific way for someone to get a new home using the reverse mortgage product. In the article Grow Your Business Through HECM for Purchase (p. 24), Berg talks to several experts about how they have capitalized on these products with success. “The biggest effort and focus for us at RMF [Reverse Mortgage Funding] has been educating real estate agents and builders,” Rob Cooper, national director of the builder/Realtor HECM for Purchase program at RMF, says in the article. “We want them to understand that this loan is an option for their potential homebuyers and customers looking to list their homes for sale.” We also learn about the huge untapped potential for the product, with the HECM for Purchase accounting for only 4.2 percent of HECM endorsements in 2021. Another highlight in this edition is an interview with Ed Robinson, American Advisors Group president and chief operating officer since August 2021. Robinson, a member of the NRMLA Board of Directors, discusses his military career and experience in lending in the From the Top Q&A article (p. 12) by Darryl Hicks, NRMLA vice president, communications. In addition to talking about leadership, he discusses the possibilities for the future, among other issues. “When you think about folks who are living on a fixed income, reverse mortgage solutions are a legitimate answer,” Robinson tells Hicks. “I really believe it’s on us to turn that ability, if you will, for reverse mortgage solutions into customer propensity and engage them in a meaningful way that drives adoption.” In Reverse In Reverse continued from page 3 (800) PRClosings.com PRCwhat you need to succeed W h h 225,000 , u u PRC! Contact us today for more information! We provide Trust and POA reviews, 24-month tax histories, curative work for old liens, a quarterly CRMP credit course, in-house legal, and numerous additional effective business tools to ensure your success! PRC is a one-stop shop for YOUR reverse mortgage title and settlement needs. 4 REVERSE MORTGAGE / SEPTEMBER–OCTOBER 2022
Moving Forward Let’s Work to Better Explain How Our Products Work By Steve Irwin, President, NRMLA “Luck is what happens when preparation meets opportunity.” —Seneca AS THE LATE Oren Harari, one of the world’s best minds in management, often explained to me, companies are not built for their employees and management teams. They are built for those customers who are willing to pay for the provided goods and services. This maxim holds especially true for the reverse mortgage industry. Our member companies are built for the reverse mortgage borrower, their families and their trusted advisers. Our success as an industry is dependent on the satisfaction of those customers and trusted advisers, and those successful outcomes depend on a service delivery that meets, or exceeds, those customers’ expectations. I have said it before, and it’s certainly worth repeating: a sure-fire recipe for exacerbating customer dissatisfaction is misaligning the customers’ expectations with the actual service that can be delivered. It is incumbent on all industry participants to strive to eliminate any disconnect between the expectations of reverse mortgage clients when their loan is transferred to the loan servicing team and the policies and procedures required of that loan servicing team. We must do all we can to ensure the borrowers’ expectations are met by the service that can be delivered. We have seen glowing testimonials of satisfied reverse mortgage borrowers. These positive outcomes are the result of the true alignment between those borrowers’ expectations and the service delivery they received. That may sound simple, but it remains difficult to execute. The best way to achieve this execution is for each of us to fully understand the complete reverse mortgage life cycle. We must arm ourselves with the knowledge of the processes and timing of the transfer to servicing partners, the regulations required for occupancy determination, the timing surrounding the distribution of draw requests, and, ultimately, the end-of-loan requirements. These loan administration requirements, once fully understood, must then be communicated to the borrowers in language as clear and plain as possible. NRMLA is here to help with these efforts. I want to remind you all that we have developed a set of consumer guides, which can be found on our member site, www.nrmlaonline.org, and on our consumer site, www.reversemortgage.org. If there are additional guides that might help our industry, please reach out to me, and let’s work together to develop more resources. We must continually strive to have customers’ expectations properly aligned with the realities of the entirety of the reverse mortgage life cycle. It’s a complicated product, and the nuances of loan administration need to be distilled to an easily understood set of expectations. Effectively establishing those customer expectations will strengthen our industry and further the cause of our products as customer-centric tools for effective aging in place. Steve Irwin REVERSE MORTGAGE / SEPTEMBER–OCTOBER 2022 5
Board Room With Reverse Mortgages, It’s All About Originators, Originators, Originators! By Jim Cory IN 2000, a sweaty, excited Microsoft CEO Steve Ballmer gave a speech to his company in which he repeatedly yelled “developers, developers, developers” something to the tune of 14 times. His point was simple and clear: developers make the products that make his company relevant. In the mortgage world and, more specifically, the reverse mortgage world, developers don’t fuel our business, but mortgage originators do. Without originators educating the public about reverse mortgages, we don’t have a business. Our industry origination numbers have been rather stagnant over the past decade. We can point to various reasons, such as cuts in principal limit factors (PLF), product changes, financial assessment and the like. But when we look at the relative lack of growth in the reverse mortgage market, I can’t help but think the issue is one of distribution—distribution from originators, of course. In my yelling voice, minus the sweat and the billions of dollars, it’s all about originators, originators, originators! Distribution is the key. More originators—trained, skilled originators—will lead to a significant uptick in our business. Our industry’s biggest volumes came when large players with huge distribution were involved, including Wells Fargo, Bank of America and MetLife. Several large players in the forward origination market have made significant inroads in the reverse mortgage space, and this is a welcome development. As a trade association, NRMLA should, and does, support this effort, with education opportunities, conferences and, of course, this magazine. But we need to do more. For too long, our industry has looked to keep this business for ourselves—and for mostly good reasons. Most mortgage originators, not to mention our borrowers, really didn’t understand our product. But years later, after countless ads promoted by celebrity pitchmen, mailers and time to let the public understand the product, we don’t really have that problem—or at least we shouldn’t. I envision one path our business can take in its next stage: accept and promote our product through the massive forward mortgage distribution channels. Retail, wholesale, forward, reverse—our reverse mortgage product should simply be one more mortgage option every originator offers and is proficient in selling. Our reverse mortgage originators, brokers, lenders and vendors and NRMLA itself should be doing everything they can to educate and embrace forward distribution of our product. It may be the only way we experience real, meaningful growth. As with any business line, if you’re not growing, then you’re dying. To sustain our important business well into the future, we need a giant leap in distribution. Let’s see if this product can reach its full potential, of course only with enough distribution—originators, originators, originators! Jim Cory To see a portion of Microsoft CEO Steve Ballmer’s presentation, visit bit.ly/3P0SVw6. 6 REVERSE MORTGAGE / SEPTEMBER–OCTOBER 2022
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New Resources for Your Clients To help commemorate #OlderAmericansMonth in May, NRMLA’s PR Committee created two new resource guides that members are encouraged to share with their clients, family members and trusted advisers. They are: • Should Mom or Dad Get a Reverse Mortgage? This is a trifold brochure that explains what a reverse mortgage is, why individuals get them, the factors that determine the amount of proceeds someone is eligible to receive, the costs and more. You can customize the back cover with your contact information; and • A Spanish-language version of the consumer guide, Reverse Mortgage Self-Evaluation: A Checklist of Key Considerations. This guide poses seven questions and important considerations that interested consumers should ask themselves, and think about, before proceeding with a loan application. Thank you to Cesar Hernandez of Premier Reverse Mortgage for translating the consumer guide. Download Should Mom or Dad Get a Reverse Mortgage? at bit.ly/3AdibuW. Download Reverse Mortgage Self-Evaluation at bit.ly/3ukJjEr. Need NMLS Credits? NRMLA Has Your Back Now is that time of year when loan officers are scheduling the 8 Hour SAFE class to earn their NMLS credits and maintain their federal license into 2023. NRMLA’s 8 Hour SAFE course, taught in partnership with Loan Officer School, offers the most content devoted almost exclusively to reverse mortgages. Benefits include: • Watching and listening—no reading; • Not a second of time more than what’s expected; and • No test or quiz of any kind. In addition to earning your federal NMLS credits for 2023, individuals who have the CRMP designation or may be pursuing the CRMP should take the course, because they can earn eight credits and complete the mandatory ethics workshop. Sign up today at bit.ly/3I9p5mF. NRMLA Launches On-Demand Learning Platform To further enhance members’ continuing education opportunities, NRMLA launched an on-demand learning platform on www.nrmlaonline.org. Three courses are currently available: • Mitigating Inflation with a Reverse Mortgage; • Preparing for a Successful Reverse Mortgage Closing: Notary Best Practices; and • Preparing for a Successful Reverse Mortgage Closing: Loan Officer Best Practices. More courses will be added throughout the year. NRMLA Launches DEI Resource Page NRMLA’s DEI Committee officially launched its Diversity, Equity and Inclusion (DEI) Resources page. It is our mission at NRMLA to strengthen the reverse mortgage ecosystem by promoting DEI practices. Please find resources on several topics at bit.ly/3AlnLeU. If you have any questions, please contact Darryl Hicks at dhicks@dworbell.com. CFPB Report Highlights Lender Violations In its spring “Supervisory Highlights” report, published in May, the Consumer Financial Protection Bureau (CFPB) emphasized violations involving compensation for loan officers and changed circumstances that NRMLA felt should be shared with the membership. The CFPB publishes “Supervisory Highlights” to help institutions and the public better understand how it examines institutions for compliance with People are talking about ... What’s News EVERYTHING NEW YOU NEED TO KNOW 8 REVERSE MORTGAGE / SEPTEMBER–OCTOBER 2022
federal consumer financial laws by summarizing existing legal requirements and violations identified during examinations. Some highlights are: • 2.6.1 Compensating loan originators differently based on product type: “Regulation Z generally prohibits compensating mortgage loan originators in an amount that is based on the terms of a transaction. … As explained by the Bureau, it is not permissible to differentiate compensation based on credit product type, since products are simply a bundle of particular terms. Examiners found that certain lenders’ loan originator compensation agreements provided for higher loan originator compensation where … [Fannie Mae] conforming fixed-rate loans surpassed a designated threshold percentage of the total loans closed by the loan originator,” according to the report. While this finding doesn’t relate directly to reverse mortgages, companies that offer HECMs and private-label reverse mortgages are bound by these same requirements in Regulation Z. Members should consult with their legal counsel to ensure compliance. • 2.6.2 Insufficient documentation for changed circumstance: “Regulation Z requires a creditor to provide the consumer with good faith estimates on the Loan Estimate for certain transactions. The closing cost estimates are generally considered to be in good faith if the amount paid by or imposed on the consumer does not exceed the amount originally disclosed. A creditor is permitted to use a revised estimate of a charge instead of the estimate of the charge originally disclosed to reset tolerances when there is a valid changed circumstance permitted by Regulation Z that resulted in the increased costs. … Examiners found that certain lenders failed to retain sufficient documentation to establish the changed circumstance’s validity. Specifically, the lenders disclosed an appraisal fee on initial Loan Estimates and subsequently disclosed appraisal rush fees, in a higher amount, on revised Loan Estimates. The lenders claimed the rush appraisals, which led to the appraisal rush fees, were requested by consumers. However, in each instance, the lender failed to maintain sufficient documentation of the consumer’s request of the rush appraisals,” according to the report. To read about these issues in greater detail, download the “Supervisory Highlights” report at bit.ly/3ug5jjJ. The press is talking about ... WSJ: Reforms Make HECMs More Appealing The Wall Street Journal (WSJ) published a positive article about reverse mortgages on June 3 that highlights many of the recent reforms implemented by the U.S. Department of Housing and Urban Development to make HECMs safer and more appealing to consumers. WSJ reporter Lori Ioannou writes, “HECMs offer protections to borrowers that include limits on how much borrowers can obtain, so seniors don’t opt for large lumpsum distributions they cannot afford; protection from default if the value of the home declines to less than the loan amount; and provisions that secure a surviving spouse’s right to remain in the home after the borrower’s death.” Retirement expert Wade Pfau told Ioannou that for seniors who are concerned about outliving their savings and who want to remain in their homes until they die, a HECM “may be a product to consider. It’s a way to free up money to pay for long-term care, and other unexpected living expenses.” Read the full article at on.wsj.com/3I4BCIg. Report: Equity Remains Key to Care Costs Someone turning 65 has a nearly seven in ten chance of needing long-term care in the future, says the U.S. Department of Health and Human Services, and many people don’t have the savings to manage the cost of assisted living. But they may have a mortgage-free home—and the equity in it, giving them the potential option of a reverse mortgage to help cover care costs. That’s according to an article by NerdWallet writer Kate Ashford that was published by the Associated Press. What’s News continued on page 10 REVERSE MORTGAGE / SEPTEMBER–OCTOBER 2022 9
“If you think you’ll have trouble covering a future long-term care need, you can get a reverse mortgage now, when home values are high,” Ashford writes. “An unused line of credit grows over time, so your balance will have increased by the time you need the money.” Read the full article at bit.ly/3OUCMYV. Reverse Mortgages Provide Cushion With the stock market getting volatile but the housing market still hot, reverse mortgages have become a more attractive tool for older Americans who need cash for retirement but want to stay in their homes, according to an article by CNBC.com writer Andrew Osterland. “This is still a great opportunity to consider a reverse mortgage,” says Wade Pfau, Ph.D., a principal and adviser with Tysons Corner, VA-based McLean Asset Management. “There’s been a big increase in housing prices, and interest rates are still low, historically speaking.” Osterland adds that reverse mortgages have developed a strong following in the financial planning profession, with advisers like Pfau recommending them as a potentially useful option in retirement distribution management. Read the full article at cnb.cx/3ODsMUa. In Washington, they’re talking about … FHA Announces More Relief for HECM Borrowers The U.S. Federal Housing Administration (FHA) issued these waivers to provide mortgagees with expanded flexibility to help senior homeowners with HECMs who continue to experience significant financial difficulties due to the COVID-19 pandemic. • Temporary partial waiver of Mortgagee Letter 2015-11: “This waiver allows mortgagees to offer repayment plans to HECM borrowers with unpaid property charges regardless of their total outstanding arrearage and is effective through December 31,” according to FHA. • Temporary partial waiver of Mortgagee Letter 201607: “This waiver permits mortgagees to seek assignment of a HECM immediately after using their own funds to pay unpaid property taxes and insurance on or after March 1, 2020, by temporarily eliminating the three-year waiting period for such assignments. The waiver is effective through December 31,” according to FHA. “As the nation continues its recovery from COVID19, these waivers offer relief to HECM borrowers who were unable to make timely property charge payments due to financial hardships resulting from the pandemic,” FHA says in FHA INFO 2022-64. Senate Confirms Julia Gordon at FHA By a vote of 51-50, the U.S. Senate on May 11 confirmed Julia Gordon as the U.S. Department of Housing and Urban Development’s Assistant Secretary for Housing and the Federal Housing Administration (FHA) Commissioner. Vice President Kamala Harris provided the tiebreaking vote. “We congratulate Julia Gordon on her confirmation vote. Given her impressive housing background, she’s ideally suited to lead FHA. We look forward to working with the incoming commissioner and her key staff on several critical issues that need to be addressed in the HECM program over the coming weeks and months,” says NRMLA President Steve Irwin. Most recently, Gordon was president of the National Community Stabilization Trust, a nonprofit organi- zation that supports neighborhood revitalization and affordable homeownership. And now you’re up to date. What’s News continued from page 9 LET US KNOW WHAT YOU’RE TALKING ABOUT. This forum is the place for readers to share their opinions with fellow colleagues about the direction of the reverse mortgage business and other retirement trends. Submissions should be limited to 100 words or less and submitted to Associate Editor Darryl Hicks at dhicks@dworbell.com. 10 REVERSE MORTGAGE / SEPTEMBER–OCTOBER 2022
FOR 18 YEARS, Reza Jahangiri has been the public face of American Advisors Group (AAG), the nation’s largest originator of reverse mortgages. While Jahangiri is still CEO and very much involved at AAG, the day-to-day operations of the company have passed to Ed Robinson, who became president and chief operating officer in August 2021. Robinson’s resume includes more than 30 years of combined professional and military leadership experience. He served 17 years in the U.S. Army, mostly in special operations. He worked as a sniper, jumped out of planes, and performed reconnaissance and surveillance work. Robinson applies many of the same principles he learned in the military to business. Robinson kept a low profile during his first couple of months at AAG, but he has taken a more active role in NRMLA. In late March, he was unanimously appointed to the Board of Directors for the balance of 2022 following the retirement of AAG Chief Legal Officer Jules Vogel. He also serves on the Executive Committee. Reverse Mortgage sat down with Robinson to learn more about his professional career, his first dealings with reverse mortgages over a decade ago and his priorities at AAG. Reverse Mortgage: Ed, help our readers get to know you a little bit better. Where did you grow up? What did your parents do for a living? How have they influenced your life and professional career? Ed Robinson: I come from a family of soldiers, so I lived all over the world, but I call Virginia and North Carolina my home. Dad was an engineer and mom was in law enforcement. They taught me to always strive to give my very best with everything, to give back to the community, to mentor folks so that they could achieve their dreams and, most importantly, to be a genuine leader who people can trust and respect. It starts with communicating with respect on a personal level and being transparent. My dad understood that everyone was different and that people had different ways of communicating. He could quickly ascertain their perspectives and speaking styles, regardless of who they were. As a result, he would speak with folks in their own preferred style of communication, and he taught me that you always need to know your audience. You don’t pander to them, you don’t cater to them, but you must understand them and communicate in a manner that they can understand and appreciate. Between my folks and the military, I’ve learned throughout my life that leadership is probably the single most important aspect of my job. RM: What attracted you to the reverse mortgage business? Did you have any prior knowledge of reverse mortgages prior to joining AAG? ER: Simply put, I love to serve. We’re in an interesting industry where we have the opportunity, literally every day, to make a direct and positive impact on the lives of American seniors. These are folks who bought into the American dream. When I was at GE Financial and later at Genworth, we looked at reverse because we had a real focus on seniors and creating an ecosystem of financial services solutions and products for them. Given our business model and products, the initial thought of entering the reverse mortgage industry was focused on offering mortgage insurance. We realized that we would effectively become a direct competitor to the FHA (Federal Housing Administration), so we performed an analysis of the total value chain and realized it was more advantageous to be a lender and/or a Ed Robinson, President and Chief Operating Officer, American Advisors Group By Darryl Hicks From the Top Ed Robinson 12 REVERSE MORTGAGE / SEPTEMBER–OCTOBER 2022
servicer. Having made that determination, we then decided to acquire the Liberty Reverse Mortgage platform. RM: What role did you play in this effort? ER: I worked on all the upfront economic analysis, determined the selection of the different folks we wanted to look at as far as acquisitions, and performed the due diligence and integration for the acquisition of Liberty Reverse Mortgage. I was working on other corporate growth initiatives, like building the bank for Genworth, so I didn’t join the Liberty platform. It’s cool joining AAG more than a decade later, because now I’m able to personally finish the work I started all those years ago. RM: You joined AAG one year ago. What has been the biggest lesson you’ve learned thus far? ER: I can tell you several lessons, such as how detrimental the bond market can be to this industry even though it should essentially be recession-proof or how different the experiences are with reverse mortgage customers versus the traditional mortgage space. Frankly, I think the biggest lesson is that we really need to double down as both a business and as an industry on adoption. The level of equity available for seniors is estimated to be around $10.6 trillion. Right now, home values are continuing to rise. I recall seeing some data from Freddie Mac recently where it anticipates—even this year during a possible recessionary environment—a ten percent increase in home-price appreciation and probably another five percent in 2023. There seems to be a rather obvious answer to liquidity challenges and inflationary pressures. When you think about folks who are living on a fixed income, reverse mortgage solutions are a legitimate answer. I really believe it’s on us to turn that ability, if you will, for reverse mortgage solutions into customer propensity and engage them in a meaningful way that drives adoption. RM: When they join a new company, presidents and CEOs often like to instill a part of themselves into the corporate culture. What values have you tried to instill in your employees? ER: There are a few elements of corporate culture that I take with me to every new job assignment. Leadership is paramount not only to meeting corporate objectives but also employee and customer engagement. There’s a literal open-door policy, so that I hear all our employees’ voices. There’s accountability. Customer satisfaction. Listening to folks on the front lines is paramount. Whether it’s our mortgage loan officers, our customer service representatives, fulfillment partners or others who have firsthand contact with customers, the insights that those personnel on the front lines provide is so valuable. I’m a firm believer that we’re all in this together. If we consistently capture the voice of our customers and our employees, we will identify corporate methods to make them better and happier. Looking back early in my career, Lean Six Sigma is what built and grew GE for decades. The one thing we always talked about was the VOC, or voice of the customer, and the VOE, or voice of the employee. Unequivocally, every single project that I was personally engaged with when it came to Lean Six Sigma at GE had a crucial element of really understanding the VOC and VOE and then incorporating that into what we did. RM: For the uninitiated, can you please remind our readers what Lean Six Sigma refers to? ER: It’s a process improvement protocol or toolkit. There’s a debate over whether GE or Motorola created it. They are two different tools. There’s Lean and then there’s Six Sigma. Lean is about eliminating what’s called “process waste” and making sure that you look at the entire value stream or customer journey and remove all the wasteful elements to make things easier for your employees and your customers. Six Sigma, on the other hand, is all about process discipline and control. It’s about making sure you take variability out of your process to become more efficient, productive and effective. RM: What changes are you considering over the next 12 to 24 months to build AAG’s market share? ER: The single most important program we’re incorporating right now is called Delight the Customer. We’re taking a very hard look at all our customer touch points, including process execution, technology and third-party relationships, so that we can deeply understand every single customer engagement. At the same time, we’re speaking with customers, both past and present, to understand moments of delight and moments of friction, so that we make concerted From the Top continued on page 14 From the Top REVERSE MORTGAGE / SEPTEMBER–OCTOBER 2022 13
improvements in how we work. We’re making it a key priority of ensuring our customers literally have a seat at the table in making AAG decisions and priorities. We’ve identified several improvements to incorporate, and a lot of those include rather significant technology enhancements. We believe these changes will simultaneously drive organic growth within the industry and be a catalyst to increasing the adoption that I spoke about a few moments ago. RM: You’ve had a partnership in place for several years with Finance of America Reverse to offer its product, but I am wondering if the time has come for AAG to offer its own private-label reverse mortgage? ER: It’s a fair question and one I’ve been asked a few times since I joined AAG. Let’s be honest, as a market leader it is incumbent upon us to lead on all fronts. So, I can safely say that we are evaluating our own proprietary products and features for future release. RM: You spent 17 years in the Army as a long-range reconnaissance team leader. How did your time in the military shape you as a business leader? ER: Before I answer that, do you know what a longrange reconnaissance team leader is? RM: I imagine you’re deployed behind enemy lines? ER: Yeah, that’s actually pretty good. It is an airborne unit, so we parachute or rappel into a designated area. We have a multifaceted mission, whether it’s gathering intel, sniper missions, etc., with very small teams, usually four to six men. You tend to work alongside the best of the best. Given my earlier responses, leadership is one answer. Another answer is tenacity. I’ve worked with some of the most amazing warriors in some of the most dangerous areas in the world. Resolve and intestinal fortitude can help you overcome most any obstacles or challenges you’re going to face. The last thing is I’m a firm believer of building a “high-performing team” as defined in both the military or by Patrick Lencioni if you read his business manuals and books. To do that, it’s absolutely critical to build rapport. You have to laugh together, you have to challenge each other, and you’ve got to ensure you hold each other accountable to the team’s collective success. It’s not about the individual. It’s truly about the team. I had the real fortune of being in a high-performing team in the military during my last combat tour and then once, in the business world, prior to joining AAG. What’s cool is, and I feel very confident in saying this is, I really believe that our team at AAG is rapidly becoming a high-performing team on a comparable basis. There’s that energy, that commitment, that camaraderie, that esprit de corps that goes into a high-performing team that I learned in the military and that I aspire to have in every single team that I’ve worked with since. From the Top continued from page 13 From the Top 14 REVERSE MORTGAGE / SEPTEMBER–OCTOBER 2022
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OLDER PEOPLE DON’T fear dying, Greg Gianoplus has learned. They fear running out of money and becoming a burden to others. Watching them cut back on their lifestyles and skip simple joys, such as going out to dinner, saddens him. But he is gratified to offer a solution. “Reverse mortgages and the flexibility of payment relief have been a real game-changer for so many of our clients,” he says. “They often reach out to us and thank us long after closing.” Gianoplus’ success in reverse mortgages has taken his career from an initial foray on Wall Street to the streets of a North Carolina beach town. His passion for the added credibility his own CRMP designation lends to his career has inspired a workplace culture that prizes the credential among his team members. There in Wrightsville, NC, in greater Wilmington, Gianoplus entered the finance industry and spent his first 20 years working with conventional mortgages. He started his own mortgage company in 1999. He sold that company, with about 130 employees, in 2008. AAXA, the company he founded, included a reverse mortgage division for strategic purposes, but he knew little about day-to-day reverse operations. Eventually, he “got in the reverse trench and learned.” “I always enjoyed being a specialist in a field of general practitioners,” he says. “I liked being the go-to guy for niche solutions.” With his kids still at home, he approached a local bank where the employees knew his reputation and offered to start a reverse mortgage division. Later, amid a merger and the new bank’s divestiture of its mortgage businesses, he took the team to a former competitor, Alpha Mortgage Corp. That was in 2016, and he remains there today. “I went back to a pure mortgage lender that’s got mortgage DNA pumping through its veins,” he says. “I knew we’d be stable from that perspective. They wouldn’t change their appetite to have me and the team. This was a nice complement to a very reputable and capable shop. Reverse mortgage lending was probably the only product line in which they didn’t have experience. It was a very nice fit.” As the reverse mortgage industry pursued ways to penetrate the purchase side, he was able to add HECM for Purchase to the division’s portfolio when Alpha opened doors to existing referral partners, including local builders and one of the area’s largest real estate firms. “We don’t have to bring doughnuts to get in the door,” Gianoplus says. Today, about 23 percent of his division’s transactions are HECM for Purchase. Many clients are transplants from the Northeast confronting the reality that the equity cashed out from the sale of their previous homes can’t cover desirable properties in coastal North Carolina. A reverse purchase money loan at 40 percent to 55 percent loan-to-value of the purchase price can, in essence, double their all-cash purchasing power. Partnering builders and real estate agents appreciate the option of available, budget-friendly financing that keeps potential clients from settling on less-expensive or competing options. “The clients are using the reverse purchase-only strategy to buy the home they really want,” Gianoplus says. CRMP Extends Retirement ‘Runway’ A Chat With Greg Gianoplus, CRMP, Channel Leader, HECM Banking Division, Alpha Mortgage Corp. By M. Diane McCormick Greg Gianoplus CRMP: Across the Kitchen Table 16 REVERSE MORTGAGE / SEPTEMBER–OCTOBER 2022
In a business where transactions are traditionally conducted face-to-face, the COVID-19 pandemic made virtual meetings a necessity. That change opened the door to Gianoplus’ team serving all of North Carolina and beyond. “We’re very much a relationship lender, and we love the face-to-face interactions, but we’ve had to retool in the aftermath of COVID,” he says. “The whole world, including the customer, has learned to adapt.” Still, whenever possible, in-person meetings are best for eye contact and myth-busting regarding reverse mortgages. Reverse mortgage lenders must learn to distill their products into simple terms to avoid confusing clients and partners, he adds. Continuing education is essential to remain apprised of constant developments and trends. Gianoplus earned the CRMP credential before he joined Alpha Mortgage. Once again, he pursued specialization. “I wanted to be a Certified Reverse Mortgage Professional in a field of those who were not certified, to demonstrate to the borrowing public that I’m very serious about not just learning the complexities of the reverse business but willing to be held to higher standards of education and ethics,” he says. In time, he hopes to have a majority-CRMP team. To get there, he offers those who earn the CRMP designation an automatic, built-in increase in their earning rates. More importantly, the division has built a supportive culture focused on making the CRMP credential a desirable expectation. “The earnings incentive is pretty much the cherry on top,” he says. “It’s not the reason to go get the CRMP. The biggest reward is the professional gratification in setting oneself apart from the field of general practitioners.” Recently, a client died at age 92. For the first 25 years of their relationship, Gianoplus produced five or six conventional mortgages for him before doing a reverse mortgage on his home of 30 years. But that wasn’t the end of the story. At age 88, the client grew tired of his homeowners association and decided to sell. Using a HECM for Purchase and leveraging his advanced age and the low interest rates, he needed a down payment of only 35 percent for a luxury patio home in a beautiful golf community. That was pre-COVID. As home values inflated, Gianoplus—doing the annual checkup that he provides for all clients—suggested refinancing. The client extracted another $100,000 from the home, and by the time he died, he had only $50,000 invested in a $800,000 home. “Isn’t that wonderful?” Gianoplus says. “He didn’t tie up his funds, and he left a nice estate for his loved ones. I told him at nearly 90 years of age, by virtue of the fact that he was willing to pack up and move across town, it was a privilege to do that reverse purchase mortgage for him.” Gianoplus plans to stick around the reverse mortgage business and help it grow. And the training and opportunities he provided several hundred people have enabled them to care for their families and build satisfying careers. “I may not be able to guarantee lifetime employment for people, but I’ve been able to guarantee lifetime employability because of the skills they’ve learned, not just in learning the mortgage business but also in how to deliver mortgage solutions to market in a professional manner,” he says. On the client side, he believes that reverse mortgages “extend the retirement runway.” “Although our clients often do not realize it upfront, they’re just so thankful years later, and that’s been one of the most professionally gratifying aspects of my career.” CRMP: Across the Kitchen Table Tappable home equity is everywhere. You just need to know where to look! Automatically identify promising reverse mortgage prospects with Reverse Mortgage Alerts from Sales Boomerang. REVERSE MORTGAGE / SEPTEMBER–OCTOBER 2022 17
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