Board Room AS SOMEONE WHO has enjoyed a career of more than 33 years in residential mortgage lending, I continue to be impressed with the quality and passion of my colleagues in the reverse mortgage niche of our industry. This was reinforced after attending NRMLA’s first in-person conference in three years in November. One of the sessions I attended—“Moving the Needle, Accelerating Sales in Today’s Market”—was presented by Tabatha Addison and Steve Sless. They reminded us that reverse mortgages are still at a two percent market penetration level. For various reasons, this has stuck with me as it is the same level as 15 years ago. What gives? We all know that over the past decade and a half, the market for households that would benefit from a reverse mortgage has grown, existing products have improved, new proprietary products have become available and the public has a better understanding of reverse mortgages overall. I certainly do not profess to know all the answers to the question. But I do feel strongly that one element is creating a stronger understanding and relationship with the financial adviser community. I believe acceptance by this community will trickle down to the public and is key to making reverse mortgages a mainstream financial product. This is particularly important now because of our current set of economic conditions. The good news is residential home equity is effectively at an all-time high. The bad news is—thanks to inflation, market volatility and the fact that we are all living longer—there has never been more pressure on making retirement income and savings stretch as far as possible. This is the most common conversation we have with our certified financial planner (CFP) and registered investment advisor (RIA) relationships and includes not just the needs-driven client but the more affluent, as well. In recent months, we have closed reverse mortgages for clients with home values from the low six-figures into the eight-figure level. I have been involved in forward mortgage origination for over 30 years, with over 90 percent of our clients being referred by some type of financial adviser, including CFPs, RIAs and estate attorneys. Ideally, these relationships grow to the level where we become their trusted adviser for all things mortgage-related. And this is also true now for our reverse mortgage referrals. In many cases, that requires us to tell that adviser that a reverse mortgage is not the right tool for the job, and their client needs another solution. This is not selling; this is advising. And it requires us to deliver the most objective information each time we are asked. I am not suggesting this is a new idea. Many reverse mortgage originators have forged such relationships with financial advisers. What I am suggesting is, as an industry, we need to expand these efforts. It is difficult. It takes a significant investment of time to create such relationships, and more pressing items may be on our schedules that will interfere. That said, I consider this a component of our long-term planning that I am confident will help produce the desired results of far greater understanding and acceptance of the reverse mortgage product. Maybe, it will allow our industry to break out of its cement shoes. Chris Downey Let’s Stop Running in Cement Shoes By Chris Downey 6 REVERSE MORTGAGE / MARCH–APRIL 2023
RkJQdWJsaXNoZXIy MjQ1MzY1