The official magazine of the National Reverse Mortgage Lenders Association www.nrmlaonline.org January-February 2024 Volume 17, No. 1 INSIDE: All in the Family: Family Members Join Forces in Reverse Mortgage Industry Milestones: NRMLA Members Celebrate Anniversaries P.22 P.28 TAKING ACCOUNT Industry Veterans Review the History and Evolution of Reverse Mortgages
From the Top David Heilman, CRMP, Principal Owner, Homegrown Financial LLC By Darryl Hicks 8 Those We Help Melanie, singer/ songwriter from Woodstock, taps reverse mortgage By Darryl Hicks 34 Features 16 Taking Account Industry veterans review the history and evolution of reverse mortgages By Joel Berg 22 All in the Family Family members join forces in reverse mortgage industry By M. Diane McCormick 28 Milestones NRMLA members celebrate anniversaries By Thomas A. Barstow Columns 2 In Reverse When reverse mortgages bring families together and evoke Woodstock By Thomas A. Barstow 4 Steve Irwin: Moving Forward NRMLA serves you—our members Departments 6 Hey, Members A roundup of issues and news for NRMLA members By Darryl Hicks 36 Member News Who’s who in reverse mortgages January-February 2024 Volume 17, No. 1 CRMP: Across the Kitchen Table A chat with Renee Konstantine, CRMP, Reverse Sales Manager/ Broker Associate, EstaR Mortgage, San Diego, CA By M. Diane McCormick 11 Contents PUBLISHER Peter Bell pbell@dworbell.com SENIOR EDITOR Thomas A. Barstow thomas.barstow@theYGSgroup.com ASSOCIATE EDITOR Darryl Hicks dhicks@dworbell.com MANAGING EDITOR 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 Tara Roth 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 Natalie Matter Bellis (natalie.matterbellis@ theYGSgroup.com) and Therese Umerlik (therese.umerlik@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 ©2024 National Reverse Mortgage Lenders Association
When Reverse Mortgages Bring Families Together and Evoke Woodstock By Thomas A. Barstow NO ONE HAS a secret sauce or single ingredient that will make a business or industry prosper. And I wouldn’t think of suggesting that I have such a formula. However, for any business that relies on word-ofmouth referrals to bring in new clients, one key to success would require a reputation that transcends a single quarterly report or yearly cycle. It takes time to build trust. And it takes diligence and a reputation for fairness to keep it. In this issue of Reverse Mortgage magazine, we discuss how some reverse mortgage professionals are building on their hard work and earnestness—developed over years, if not decades, of networking in their communities—and passing it on to the next generation. And I mean literally the next generation: NRMLA members who built their businesses and then brought their relatives into the industry. In the article All in the Family (p. 22), writer M. Diane McCormick explains how the Turks, Skaggses, Downeys and Coopers have made reverse mortgages family affairs. The Coopers, for example, work in different offices at Mutual of Omaha in California but collaborate often. “It’s really helpful to have a partner in this business, someone you know you can trust just to talk things through,” Mitchell Cooper, CRMP, tells McCormick. It isn’t always the older generation passing along wisdom to the younger generation. “He’s taught me the passion of every single day and every single client,” Launi Cooper, CRMP, says about her son. “We do really work well together playing off each other. The best day is when we get to meet a client together.” This issue, the first of 2024, features other articles that celebrate NRMLA members. In what we think will be an annual theme, we have an article titled Milestones (p. 28). It looks at members who are celebrating anniversaries this year in five-year increments—2019, 2014, 2009 and 2004. The goal of this is simple: NRMLA’s members are its backbone, and we want to hear from people who hit this milestone. We also talked to some members who have been with NRMLA the longest, regardless of their official anniversary, in the cover feature Taking Account (p. 16). With a modest start long ago, the industry really began taking off in the 2000s. It continues to weather numerous changes, including right up to the end of 2023. In the fall, the Federal Housing Administration published its long-awaited Single-Family Housing Policy Handbook In Reverse 2 REVERSE MORTGAGE / JANUARY-FEBRUARY 2024
4000.1, which includes specific sections on HECMs. It is a big step in the journey for HECMs to gain widespread acceptance, something all stakeholders say needs to continue. Only a small percentage of those who are eligible for a reverse mortgage have gotten one. The industry experts we interviewed peer into the future, knowing that 2024 is following a challenging year for the industry. They offer some advice on methods that have helped with their success. As Paul Scheper, CRMP, puts it in Milestones, reverse mortgages provide people at or near retirement an opportunity to attain “the new American dream.” This version of the housing dream is the opportunity for seniors to live in their homes forever, free of financial stress. While estimates vary, roughly 70 million Baby Boomers are out there, with most of them at or near retirement. For many people in this target demographic for reverse mortgages, the last time they were truly carefree might have been in their teens in the 1960s, 1970s or 1980s. They might have even attended Woodstock, the famous gathering in 1969 that came to symbolize a carefree time. I found it interesting that Melanie, one of the musicians who played at Woodstock, recently used a reverse mortgage to take some financial stress off her later years. That article is this issue’s Those We Help (p. 34). The COVID-19 pandemic limited her ability to tour and took a financial toll, and a reverse mortgage has helped her to pay for expenses. “I would highly recommend it to anyone,” she says about reverse mortgages during an interview at NRMLA’s Annual Meeting and Expo in October. While reverse mortgages aren’t the secret sauce to a completely carefree retirement, they certainly are an important ingredient. Thomas A. Barstow, senior editor of Reverse Mortgage, is a writer and editor based in Pennsylvania. In Reverse Partnership you can trust. Dedicated to never competing with you - your success is our success. Ready to experience the difference? Visit Celink.com Deep Industry Experience 96% Borrower Satisfaction Rating Independence and Alignment with Clients Robust Specialized Technology Reverse Mortgage Is Our Core Competency © Celink. All rights reserved. NMLS #3020 - http://nmlsconsumeraccess.org. Compu-Link Corporation dba Celink (WA license# CL3020 and 603 018 607) REVERSE MORTGAGE / JANUARY-FEBRUARY 2024 3
NRMLA Serves You—Our Members By Steve Irwin, President, National Reverse Mortgage Lenders Association NRMLA IS A membership association. Membership is at a company level, with employees of that company able to enjoy the benefits of membership at no cost to themselves as member delegates. Through the support and participation of our member delegates, we can continually move our segment forward and celebrate all we have been able to accomplish. We, as an association, have worked tirelessly to advocate on our members’ behalf—and on behalf of the senior homeowners our members serve. In Washington, we have successfully worked on both sides of the aisle with the U.S. Senate Appropriations Committee and U.S. House Appropriations Committee. We have also developed meaningful relationships, again on both sides of the aisle, with the U.S. Senate Banking Committee and U.S. House Financial Services Committee. We engage with the U.S. Department of Housing and Urban Development (HUD) and Federal Housing Administration (FHA) to ensure a continued and successful HECM program. There remains work to be done with HUD. But through meetings with FHA commissioners, other political appointees and career staff, NRMLA has been able to ensure the department’s continued support of the HECM program through successive administrations. We also continue to frequently engage with Ginnie Mae on our members’ behalf to ensure continued liquidity for the reverse mortgage marketplace. NRMLA has created a committee structure that enables our members to collaborate as competitors on a myriad of common issues. Members are welcome to participate in these committees. NRMLA administers the most rigorous reverse mortgage certification program: the CRMP. NRMLA launched the Reverse Mortgage Market Index in partnership with RiskSpan to track accumulated senior home equity. NRMLA maintains two unique websites on behalf of our members: a member site, NRMLAonline.org, and a robust consumer site, reversemortgage.org. We have developed a set of guides for consumers and their trusted advisers on reverse mortgage products. NRMLA publishes the award-winning Reverse Mortgage magazine for our members as a complimentary benefit of membership. We also publish a weekly newsletter as a membership benefit. Furthermore, NRMLA hosts several unique, best-inclass conferences and exhibitions each year. The feedback from these events remains overwhelmingly positive, and we are recognized for events that promote best practices, educate our members and provide unique business opportunities for our attendees. We are able to do this work through the strong support and participation of our membership. I hope you and your colleagues find value in what we do on your behalf, and we can count on your continued support in the new year. Moving Forward “Effectively, change is almost impossible without industry-wide collaboration, cooperation and consensus”—Simon Mainwaring, Branding Expert and Author Steve Irwin 4 REVERSE MORTGAGE / JANUARY-FEBRUARY 2024
A NAME YOUR BORROWERS KNOW AND TRUST MutualMortgageWholesale.com Mutual of Omaha Mortgage, Inc. dba Mutual of Omaha Reverse Mortgage, NMLS ID 1025894. 3131 Camino Del Rio N 1100, San Diego, CA 92108. These materials are not from HUD or FHA and the document was not approved by HUD, FHA or any Government Agency. Subject to credit approval. For licensing information, go to: www.nmlsconsumeraccess.org #1006013658
Hey, Members A Roundup of Issues and News for NRMLA Members By Darryl Hicks TO HELP MAKE more efficient use of your time, we have updated the Hey, Members column by providing shorter, bulleted news items with links to more information. If you have questions, contact me at dhicks@dworbell.com. • The U.S. Department of Housing and Urban Development (HUD) published Federal Housing Administration (FHA) Info 2023-69 on August 23, 2023, to clarify its policies related to the late payment of HECM mortgage insurance premiums and payments made to HECM borrowers in the event of a mortgagee default. (https://www.hud.gov/sites/dfiles/ SFH/documents/SFH_FHA_INFO_2023-69.pdf) • Senior home equity levels increased by $820 billion in the second quarter of 2023, to $12.69 trillion, according to the NRMLA/RiskSpan Reverse Mortgage Market Index released on September 15, 2023. (www.NRMLAonline.org/about/press-releases/ senior-home-equity-levels-rebound-to-12-7-trillion-in-q2) • In mid-September 2023, HUD’s Office of Housing Counseling updated Chapter 4: Reverse Mortgage Housing Counseling in Handbook 7610.1 REV-6. HUD noted that counseling sessions should last from 60 to 90 minutes and broadened counseling methods to virtual or remote counseling. The updates take effect on January 1, 2024. (www.NRMLAonline. org/wp-content/uploads/2023/09/Updated-HousingCounseling-Handbook-9-13-2023.pdf) • More Americans believe they’re saving enough for retirement, according to Goldman Sachs’ Retirement Survey & Insights Report 2023, which found that 65 percent of respondents felt their savings were on track, up from 57 percent this past year. The report was published on September 19, 2023. (www.gsam.com/content/gsam/global/en/market-insights/gsam-insights/2023/ retirement-survey-insights-report.html#retirementreport) • To help alleviate the ongoing liquidity pressures felt by HECM mortgage-backed securities issuers, Ginnie Mae updated its pooling requirements to allow for multiple participations related to a particular HECM in any one issuance month. Details were provided in All Participant Memorandum 23-11, published on September 22, 2023. (https:// www.NRMLAonline.org/2023/09/29/ginnie-mae-updates-hmbs-pooling-eligibility-requirements) • NRMLA published Ethics Advisory 2023-01: Ethical Considerations-Applicant Age and Loan (Credit) Pricing on September 25, 2023, as a reminder to members that they may not offer or charge a higher interest rate or other less favorable terms based on an applicant’s more advanced age. The ethics advisory was drafted and approved with input from NRMLA’s Ethics and Executive Committees and outside general counsel. (https://www.NRMLAonline.org/ wp-content/uploads/2023/09/Ethics-Adivsory-OpinionApplicant-Age-Considerations-9-25-23-1.pdf) • On October 12, 2023, the U.S. Social Security Administration announced a 3.2 percent cost of living adjustment for 2024, but a survey released the same day by The Senior Citizens League indicates that older adults are pessimistic about their finances in coming months and the growing potential for Social Security benefit cuts. (seniorsleague.org/assets/ Press-Briefing-10.12.23.pdf) • Congratulations to our newest CRMPs: Chris Freck, Mutzig Management, Inc. dba Estar Mortgage; Diamond Vu-Lyons, Land Home Financial Services; Bryan Smith, Your Better Loan LLC; William Yoho, University Bank; Lily Gabriel, Land Home Financial Services; Eleadah Kemp, Finance of America Reverse LLC; Todd Warren Zurik, C2 Financial Corp.; Lori Anderson, Thrive Mortgage; and Terri Duncan, American Pacific Reverse Mortgage Group. Learn more about becoming a CRMP by visiting https://www.NRMLAonline.org/crmp-designation. Darryl Hicks is NRMLA’s vice president of communications. Hey, Members 6 REVERSE MORTGAGE / JANUARY-FEBRUARY 2024
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DAVID HEILMAN, CRMP, began his reverse mortgage career in 2007 when he landed a job with Franklin Funding, a mortgage brokerage in Charleston, SC. His job focused on business development and building relationships with other local businesses that provided services to the region’s aging population—the thought being that a reverse mortgage could help pay for a person’s in-home care, home modifications or other services to help them age in place. The result was an extensive network that would become the official chapter of the Charleston Aging in Place Council. For several years, Charleston became a role model for other cities across the United States that wanted to build similar networks for seniors to access. The Charleston Aging in Place Council would later disband, but Heilman is still originating reverse mortgages through his own mortgage brokerage company. Reverse Mortgage sat down with Heilman to talk about how he has remained successful over the past 16 years and what he’s doing to stay competitive. Reverse Mortgage: How did you get your start in the reverse mortgage business? David Heilman: Right out of college, I landed a job working with seniors in a community outreach type of David Heilman, CRMP, Principal Owner, Homegrown Financial LLC By Darryl Hicks David Heilman From the Top 8 REVERSE MORTGAGE / JANUARY-FEBRUARY 2024
role. Soon after, I was approached by Paul and Barbara Franklin, who were longtime participants in the reverse mortgage business. I didn’t know much about reverse mortgages. I had heard things and was skeptical, just like most people at first. The Franklins said they really needed help with their business and thought I’d be a good fit. For the next three months, I did my research and found that it was a viable product and solution for many people. I took the dive in 2007 and switched gears from healthcare administration to reverse mortgage financing. RM: People come and go all the time in this business, but you’ve stuck it out through good and bad times. What has attracted you to reverse mortgages all this time? DH: We help people. I love being able to help someone solve a problem. Our clients run the spectrum as far as their goals and objectives with this product, but at the end of the day, we’re providing a solution that solves a problem. That is why I’ve stuck with reverse mortgages for almost 17 years because at the end of the day, it solves problems. RM: Have you seen any changes from 2007 to now for why someone pursues a reverse mortgage? DH: I can put a client in one of three categories: needsbased, lifestyle enhancement or financial security. That hasn’t changed much since 2007. For a time, I was seeing more affluent borrowers. That has waned a little bit over the past year and a half, but my clients still fall into one or a combination of those three categories. RM: What do you mean by lifestyle enhancement? DH: When I put somebody in a lifestyle category, they’re either wanting to maintain a lifestyle that they enjoy, or they want to achieve a lifestyle that they’ve never had. Maybe it’s a dream vacation that they could never afford. Most of the people I work with use a reverse mortgage to maintain a lifestyle that they once had and wish to maintain while living on a fixed income. RM: Tell us about Homegrown Financial and what distinguishes it from other mortgage brokers. DH: I make it clear to every potential client that I am a reverse mortgage expert who is here to help get them from Point A to Point B, but at the end of the day, you need to have peace of mind with the product itself. I tell people point blank that if doing this loan causes them to lose sleep, then they need to find another solution. That has always been my stance from the beginning. I learned that from Paul Franklin, obviously a big mentor of mine. I’m not here to sell anybody on a reverse mortgage. I’m here to educate them on the reverse mortgage and then help them with my expertise get through the process as quickly and as painlessly as possible. At the end of the day, my post-closing interactions with clients and their children, even when the loan becomes due, have always been good. I haven’t experienced any backlash. I think that’s probably because I’ve never tried to fit somebody into a reverse mortgage who wasn’t suitable. RM: How many people are part of the reverse mortgage team? In how many states do you offer reverse mortgages? Do you offer other loan products or just reverse mortgages? DH: It’s a small group. There’s me and one other loan officer, Gary Landon, who’s in the Beaufort-Sun City area, which is heavily populated by seniors. We also have Julie Moxley as our in-house processor. We only originate in the state of South Carolina, which is by design. I see no reason to dip into bordering states at the moment, and I certainly don’t mind giving referrals out to other CRMPs in other states. RM: Are there particular approaches to marketing and lead generation that you have adhered to over the years, or do you try different things depending on what’s going on in the marketplace? DH: I’ve tried everything, and I say that laughing because we all know there is no silver bullet with marketing this product. It’s all about walking and talking, meeting people, and becoming a trusted referral source. I’ve built a sizable network over the course of my career to the point where 90 percent of my business comes from referrals. I send mailers from time to time when it’s appropriate, certainly during From the Top continues on page 10 From the Top REVERSE MORTGAGE / JANUARY-FEBRUARY 2024 9
From the Top From the Top continued from page 9 the refi boom, but I’m not doing anything other than being involved in the community and meeting bankers, financial planners and attorneys. Those are my main three referral sources. RM: When we first met back in the mid-2000s, you were heavily involved in creating the Charleston chapter of the National Aging in Place Council. I know that chapter has disbanded, but do you still see community involvement as a key to your success? DH: Yes, it’s a place that I need to get back to—and that is the best way to put it. The [COVID-19] pandemic created this ability to work from home, which is great in many cases, but it also got me away from being involved in community organizations and networking groups like Rotary International and chambers of commerce. All that went by the wayside after 2020. And here we are in 2023, and I’m not nearly as involved as I used to be. Community involvement is huge, and it’s something that I need to personally get engaged with despite being casual in working from home. RM: As we begin 2024, what do you anticipate doing differently to stay competitive? DH: I just touched on it. It’s a goal of mine to get more involved in the community and find organizations that mean something. You’re going to get referrals naturally just by telling people what you do, especially if you tell people that you do reverse mortgage financing. They’re immediately interested and want to know more. Getting involved in the local Rotary, financial planner associations, banker associations, mortgage broker associations or whatever those different associations are, finding a way to get involved with those is certainly a goal of mine. Darryl Hicks is NRMLA’s vice president of communications. LET US PROTECT YOUR ASSETS SERVICES Preservation Inspection Title and Diligence Property Maintenance & Tenant Services Appraisal & BPO REO Asset Management Vacant Property Registration & Utility Processing GuardianAssetMgt.com Guardian Asset Management is an industry leader providing our clients a comprehensive range of solutions to help manage and maintain their properties effectively yielding the highest return. 10 REVERSE MORTGAGE / JANUARY-FEBRUARY 2024
THE STORM-TOSSED TREE crashing through a home’s roof made the local news. Unfortunately for the 78-year-old homeowner, the home was uninsured. A contractor who realized the situation was dire had the foresight to connect with loan officer Renee Konstantine through one of her referral partners. “We did a reverse mortgage with a repair set-aside so the contractor got paid,” she says. “The homeowner was crying. He didn’t know how he was going to get it all fixed. Now, his house is beautiful, and the value went up tremendously because of all the improvements.” Konstantine has leveraged the versatility of reverse mortgages and the credibility of her CRMP in countless situations to help older clients stay in their homes. She is keen on educating potential clients, referral partners, CRMP: Reverse Mortgages Have a Bright Future A Chat With Renee Konstantine, CRMP, Reverse Sales Manager/Broker Associate, EstaR Mortgage, San Diego, CA By M. Diane McCormick Renee Konstantine CRMP: Across the Kitchen Table CRMP continued on page 12 REVERSE MORTGAGE / JANUARY-FEBRUARY 2024 11
NRMLA colleagues and herself about the possibilities inherent in reverse mortgages, especially when solutions seem out of reach. California Living Konstantine has lived in San Diego most of her life— “What’s not to love about San Diego?”—and sidled sideways into reverse mortgages. The graduate of San Diego State University first worked for her alma mater as a math department budget analyst. In 2002, she was looking for her first home when she learned about an on-campus workshop on California’s silent second mortgage program. On the day she attended, the room was packed, and Konstantine was intrigued. Wanting to learn more, she approached the broker running the workshop at the end and asked if he could use some help. Excited, he said, “Yes!” “I’m the type who really needs to jump into something wholeheartedly and learn about it,” she says. “I learned about mortgage rates. I learned about time frames and credit—everything to do with home loans. I just loved it. I found a passion in it.” She continued helping first-time homebuyers and loved the work so much that she became licensed as a mortgage loan officer, followed by her broker’s license in 2004. “I was very personable with people, and it worked out well because they actually became friends,” Konstantine says. “I feel like I have a huge family. Growing up as one of seven siblings in my family, it felt like a seamless and natural experience.” Konstantine investigated reverse mortgages in 2003 when a former client wondered if one might suit her mother. After careful consideration and discussion, they decided unanimously that a reverse mortgage would be the ideal choice. “It was such a fulfilling experience in so many ways,” she says. “This is when I fell in love with working with seniors. Her mom was so grateful and so appreciative. It made a lasting impression.” After that, she would only sporadically provide reverse mortgages until 2010, when forward mortgages came to a standstill. Her colleague, Kevin Melody, determined that reverse mortgages could fill the gap, and the two embarked on a learning journey. “We underwent a strategic pivot,” she says. “He came up with the idea of doing reverse mortgages for seniors. He was all about having a niche, like a doctor. Be a podiatrist, be a surgeon, be a psychiatrist. We got educated on it by dedicating ourselves to acquiring comprehensive knowledge and expertise in this field.” Their workshops, held at libraries and restaurants, attracted up to 30 interested older adults at a time. Konstantine began introducing herself and her services to senior centers and banks. She and her colleague aligned with C2 Financial Corp. for the connections to diverse lenders whose array of programs allowed them to fine-tune the options presented for each client and their unique needs. At C2, Konstantine ultimately joined forces with fellow CRMP Christina Harmes, helping her grow her mentorship program as a consultant and client liaison. Konstantine and their head processor, Kimberly Buckley, also a CRMP, streamlined the process to help close reverse mortgages in 30 days or less—a system they presented in a NRMLA workshop as a valuable means for sealing deals, while windows of opportunity remain open. By 2020, Konstantine and Harmes’ team was providing eight to ten reverse mortgages a month. “Each one is so different,” Konstantine says. “It’s like people. They’re just different. I was able to get a lot of details on a personal level to assess situations and handle a wide variety of circumstances. This really is what helped me to pass the CRMP test that same year. The knowledge base needed to pass the test is quite immense.” In 2021, EstaR Mortgage owner Chris Freck, also a CRMP, invited Konstantine to head a new reverse mortgage division. They had met at a previous NRMLA conference, when Konstantine was speaking on a panel on silver divorces, and she happily accepted this new opportunity. That phase of her career slightly preceded the current mortgage-lending downturn, so Konstantine is now using her time to become more involved in NRMLA. Serving on the Education Committee is “a natural fit because education has always been CRMP continued from page 11 CRMP: Across the Kitchen Table 12 REVERSE MORTGAGE / JANUARY-FEBRUARY 2024
important in my life, and I love learning,” she says. She has also embraced the integration of artificial intelligence into her business practices, amazed by its efficiencies and the power to create schedules for such duties as social media postings or reaching out to former clients with scheduled nurture emails. Making a Difference Konstantine feels she has made a difference in the lives of many people. There was the woman undergoing a divorce whose reverse mortgage prevented her from having to sell her home and who then saved her reverse mortgage line of credit of more than $40,000 for a rainy day. That rainy day arrived in the form of a $38,000 bill for a new roof—and she didn’t have to touch her retirement savings to pay for it. There was also the retired nurse whose savings were being eaten by veterinary bills for his beloved cat. Distressed by his financial demands, he decided to sell his condo and rent an apartment, but the real estate agent felt uncomfortable with that option, knowing the homeowner really did not want to leave his home of more than 20 years. That was when they called Konstantine. It meant getting a Federal Housing Administration spot approval for the condo project itself, but Konstantine was able to get it approved and get the client’s reverse mortgage so he and his cat could stay in their home. “He is so thrilled,” she says. “He said his stress level has gone down so much he thinks he’ll probably live another 20 years.” Konstantine’s CRMP, earned in 2020, helped seal her role as a trusted adviser and advocate for clients. The industry’s stamp of approval gives them the confidence to believe what she says. Plus, the CRMP’s strict ethical obligations provide assurance that she answers their questions with facts, not speculation. “When you’re talking to a CRMP, chances are, they’ve already either researched the question, or they’re going to research it,” she says. “And if something isn’t what they thought it was, they’ll be the first to tell you right away.” Getting Involved Outside work, Konstantine volunteers to deliver for Meals on Wheels. It’s a humbling experience that’s about more than feeding people. She is visiting unfamiliar neighborhoods, checking on the well-being of individuals who are shut-in and providing perhaps the only conversations they have in a day. “Most of these clients are in wheelchairs or walkers and can’t even get to the door,” she says. “They do understand what’s going on, but they have a lot of physical limitations. I feel blessed and fortunate every day that I’m able to go to the grocery store on my own and feed myself.” Konstantine also supports small businesses, shopping at farmers markets and buying local whenever she can. Since turning 65 and qualifying for Medicare, she enjoys the “awesome benefit” of regular gym visits through Silver Sneakers. When she can, she visits her daughter and grand-dog, a pug-boxer mix, in Montana. Thinking back on the impact she has made, she remembers her grandmother, who lived on a beach in La Jolla. No one in the family knew about reverse mortgages, and Konstantine’s mother had to sell the house and downsize to pay for her care expenses. Konstantine’s grandmother was confused and disoriented about the layout of her new, unfamiliar home, which gave Konstantine insight into why many people want to stay in their homes—simply because they have the confidence to navigate their familiar spaces. “My grandmother could have been a prime example,” she says. “If they had gotten a reverse mortgage, she could have stayed there, and they could have used the money to pay for her care.” Konstantine envisions a future where reverse mortgages gain prominence as valuable financial planning tools for seniors, for uses that include delaying Social Security benefits, eliminating existing mortgage payments or funding home modifications. “The more people that have CRMP credentials, the better, because they’ll be able to clearly articulate the advantages of reverse mortgages with local bankers, financial planners and realty agencies in a concise way that makes sense,” she says. “I have a positive outlook for the future of reverse mortgages and spreading the benefits. Together, we will elevate the industry.” M. Diane McCormick is a writer and editor based in York, PA. CRMP: Across the Kitchen Table REVERSE MORTGAGE / JANUARY-FEBRUARY 2024 13
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TAKING ACCOUNT SABRA RICHINS HAD been working in the mortgage industry for about 19 years when she was hired in 1999 by a group of financial advisers who offered forward mortgages to their clients. After one of the partners learned about reverse mortgages, the group added the product to its mix, says Richins. “I like to help people find a loan that fits them, and the reverse mortgage was a good addition to our portfolio of loan types.” Industry Veterans Review the History and Evolution of Reverse Mortgages By Joel Berg Taking Account continued on page 18 REVERSE MORTGAGE / JANUARY-FEBRUARY 2024 17
In 2003, she bought the advisers’ mortgage business, FSI Mortgage in Salt Lake City, UT, and she has not looked back. “Of course, the amounts go up and down; the rates go up and down. But the basics that make a reverse mortgage a reverse mortgage have never changed. That stays constant.” Misconceptions about the product also have endured, says Richins, managing member of FSI Mortgage. Despite the complex nature of reverse mortgages, she says, “borrowers are starting to get the hang of it.” Backstory The first reverse mortgage, originated in 1961, was the brainchild of a Maine banker who wanted to help a widow stay in her home after her husband’s death. Within a decade, lawmakers began to take an interest in the product, given its potential to help older homeowners tap into their home equity while remaining in their homes. But it was not until the 1980s that Congress began taking concrete steps to create the HECM. The first step was a 1983 proposal by former U.S. Sen. John Heinz, a Pennsylvania Republican, to have reverse mortgages insured by the Federal Housing Administration (FHA). A proposal to establish a HECM pilot program was later added as an amendment into a comprehensive housing bill that was signed into law in 1988 by President Ronald Reagan. Lenders quickly adopted the HECM, though they also continued to offer and experiment with proprietary reverse mortgages. Megen Lawler, owner of Novato, CA-based Bay Docs, got her start in 1991 as a marketing analyst for a proprietary reverse mortgage product. The company where she worked became a HECM servicing company and developed a way to process documents electronically. The U.S. Department of Housing and Urban Development (HUD) eventually told the company that as a servicer, it could not charge for document preparation, Lawler says. So, in 1994, her boss suggested she start her own documentation company. Lawler says she was initially apprehensive given the seemingly clerical nature of the work. But she grew more enthusiastic as she began to understand all of the nuances of running her own business. “I was excited to give it a shot,” she says. And Bay Docs was born. Regulatory Influences The evolution of the HECM has been closely tied to regulatory changes. In the first few years after Lawler founded Bay Docs in 1994, the program was fairly consistent. The chief milestone in the 1990s came in 1998 when the HECM program was made permanent, and Congress approved funding for counseling and other consumer education. More frequent changes started coming after the turn of the century, Lawler says. They included the ability to keep nonborrowing spouses on a home title and the introduction of HECM-to-HECM refinancing. Taking Account continued from page 17 Sabra Richins Megen Lawler “Of course, the amounts go up and down; the rates go up and down. But the basics that make a reverse mortgage a reverse mortgage have never changed.” —Sabra Richins, managing member of FSI Mortgage 18 REVERSE MORTGAGE / JANUARY-FEBRUARY 2024
Taking Account continued on page 20 The housing crash and Great Recession of 2008 and 2009 proved something of a mixed bag for the industry. The financial troubles coincided with the first wave of Baby Boomers to turn 62 years old, a turning point that meant a larger market for HECMs. In 2008, meanwhile, HUD introduced the HECM for Purchase, a product that has proved especially valuable to a segment of older borrowers. Reverse lenders, however, faced challenges in funding loans as the crash dried up warehouse lines, impacting HECM originations, Lawler says. Several high-profile lenders, such as MetLife and Wells Fargo, decided to exit the reverse business, further hampering originations. The reverse mortgage market bounced back over the next five years, Lawler says. People who had been employed by lenders that left the business found their way to other companies. But then came the introduction of the financial assessment, which required a closer look at borrowers’ ability to keep up with their property taxes and insurance payments. The changes slowed growth for HECM originations. A countervailing force came in 2017, when HUD began instituting annual increases in the HECM lending limit. The limit, which had been fixed at $625,000 between 2009 and 2017, is now over $1.1 million. The COVID-19 pandemic in early 2020 threw another curveball at the industry by making it harder for reverse originators to meet with their clients. The crisis did have an upside—hastening the adoption of new tools for marketing reverse mortgages, educating borrowers and processing loans. In response to the economic toll of the pandemic, the Federal Reserve lowered interest rates, which created several repercussions for the mortgage industry. Low rates prompted a wave of refinancing for forward and reverse mortgages. They also contributed to a run-up in home prices, which meant homeowners had more equity to tap when they opted for reverse mortgages. Reputational Roller Coaster Reverse mortgage lenders have long worked to improve the reputation of their product. Over the years, they have employed high-profile, trusted spokespeople, ranging from singer Pat Boone to actor Tom Selleck. Lenders also have worked hard to cultivate financial planners, many of whom are open to considering reverse mortgages for their clients. “The value of the reverse mortgage is working in concert with an overall financial plan to solidify their plans against the inevitable bumps in the road that could happen and give them more flexibility and confidence in their future,” says Clay Selland, CRMP, president of Signet Mortgage Corp. in San Ramon, CA. Nonetheless, reverse mortgages often mystify borrowers, and a burst of negative publicity in the late 2010s further complicated the marketing picture. The Clay Selland “The value of the reverse mortgage is working in concert with an overall financial plan to solidify their plans against the inevitable bumps in the road that could happen and give them more flexibility and confidence in their future.” —Clay Selland, CRMP, president of Signet Mortgage Corp. REVERSE MORTGAGE / JANUARY-FEBRUARY 2024 19
basic misunderstandings remain relatively consistent, says Richins. Chief among them is that borrowers still worry lenders will take their house after they die. FSI Mortgage tackles the issues directly through seminars and classes offered to the public. The subjects have included how to use home equity to fund retirement, as well as other programs available through local and national agencies. The key, Richins says, is to focus on the educational content—such as directly addressing borrowers’ misconceptions—rather than making the courses a product sales pitch. “We’re not trying to talk them into anything because I think a homeowner is totally capable of making a decision,” she says. Knowing how this type of loan works gives the homeowner the ability to decide if it fits in with their planning. Social media is beginning to emerge as a platform to reach potential reverse borrowers, she says. But it is not quite there yet. “I think in the next couple of years we’ll start seeing more of it.” Current Market After a prolonged period of low interest rates, reverse lenders are now contending with an extended forecast for higher rates, which reduces the amount of home equity borrowers can withdraw. The Fed expects to keep interest rates at their current levels through at least late 2024. Despite some headwinds, reverse mortgages continue to benefit from longer-term trends. One of the most significant is the aging of the Baby Boomer generation, whose youngest members will start turning 62 in 2024. As a cohort, Boomers are more comfortable with debt than previous generations, and they are more likely to be carrying mortgages into retirement. A reverse mortgage allows them to eliminate their mortgage Taking Account continued from page 19 20 REVERSE MORTGAGE / JANUARY-FEBRUARY 2024
payments while giving them another source of income in retirement. The long-term uptick in home prices also makes reverse mortgages attractive, lenders say. Homeowners have more equity than ever to tap into. And given the shortfalls in many people’s retirement accounts, they are going to need it. High interest rates, meanwhile, mean reverse home equity lines grow faster than they would in a low- rate environment, creating additional benefits for the reverse product. Another side effect of higher rates is a decline in refinancing for forward and reverse mortgages. Industry observers expect the decline could prompt forward lenders to take a closer look at reverse products, particularly if home sales remain sluggish. “We’ve been trying for years to break into the forward mortgage industry,” says Lawler. “Our best timing for that is when their refi market has dried up and then they go, ‘Hey what’s that reverse mortgage industry everyone kind of whispers about?’” In fact, Lawler says her firm sees potential opportunities from large banks interested in the product. Bay Docs is looking to work with at least one large bank, she adds. The due diligence, however, has been taking time. Richins is also optimistic about a potential influx of new borrowers, as well as a growing openness among seniors looking for ways to shore up their finances. Many seniors entering retirement still have monthly mortgage payments. “We’ve got people who are looking online for options on how to reduce their monthly payments, especially with the high interest rates in the current mortgage market,” she says. To help lenders and servicers, FHA has published a comprehensive guide to HECMs, consolidating information that had been scattered across more than 100 policy documents. The new guidance, included in the SingleFamily Housing Policy Handbook 4000.1, also creates a more flexible framework for updating regulations, federal officials say. “HECM mortgages are an important tool to help senior homeowners age with security and dignity in their own homes,” Assistant Secretary for Housing and Federal Housing Commissioner Julia Gordon said in a statement. “The completion of the HECM sections of our Single Family Handbook reinforces FHA’s commitment to the HECM program and is part of a larger effort to retool the program for long-term success.” Joel Berg is a writer and editor based in York, PA. “We’ve been trying for years to break into the forward mortgage industry. Our best timing for that is when their refi market has dried up and then they go, ‘Hey what’s that reverse mortgage industry everyone kind of whispers about?’” —Megen Lawler, owner of Bay Docs Julia Gordon REVERSE MORTGAGE / JANUARY-FEBRUARY 2024 21
PARKER TURK, CRMP, has “a unique energy and a unique way of interacting with people that is confidence-building,” says his dad, Terry Turk. Parker Turk’s ability to attract equally innovative talent is helping their firm, Sun American Mortgage, transition into the age of technology. “The mortgage industry completely reinvents itself every few years,” says Terry Turk. “You almost have to completely rebuild yourself from scratch, and having a group of young people with energy, adaptability and know-how has been nothing short of phenomenal.” As reverse mortgages mature, veterans in the field see hope for the future in the children they have prepared for leadership. When reverse mortgages are family affairs, parents teach their children a passion for the work. Children reinvigorate their parents’ enthusiasm and strive to build on their legacies. “I stand on the shoulders of All in the Family Family Members Join Forces in Reverse Mortgage Industry By M. Diane McCormick 22 REVERSE MORTGAGE / JANUARY-FEBRUARY 2024
giants,” says Parker Turk. “I don’t think I could have messed it up. I had too many good examples.” Second generations took different pathways into reverse mortgages, but they all stayed because the difference reverse mortgages make resonates across generations. Beginnings: The Turk Family Parker Turk is a loan officer for Sun American Mortgage, Mesa, AZ. He worked during summers in his grandfather’s construction company. In the first phase of his career, he earned a master’s degree in accounting and a CPA, but eventually he joined the financing arm of Sun American, where his father, Terry, is president and CEO. Terry Turk was also a founding member of NRMLA’s Board of Directors when the association was incorporated in 1997. By 2008, Parker Turk was originating reverse mortgages when his parents were called to serve on a three-year mission trip in South America. He had six months to prepare to lead operations. It was a “baptism by fire,” says Terry Turk. But with help from a loyal team and a strong board of directors, Parker Turk “shouldered most of the burden during those difficult times.” His son says he always knew he was in the right place. “In my mind, I saw the ability to help people,” Parker Turk says. “I had seen people get access to money they never thought they’d be able to have access to and continue to maintain their houses. To me, it was such a win for people who otherwise wouldn’t have known where to turn.” Beginnings: The Skaggs Family When Sean Skaggs was in high school, he was an office assistant for his parents, Ellen Skaggs, CRMP, now reverse national production manager at Paramount Residential Mortgage Group (PRMG), and John Skaggs, PRMG reverse mortgage specialist. In those early years, Sean Skaggs would manually stamp direct mail campaigns, set up files and sometimes call his friends to help move boxes. All in the Family continued on page 24 Sean Skaggs Parker Turk “I stand on the shoulders of giants. I don’t think I could have messed it up. I had too many good examples.” —Parker Turk, CRMP, loan officer for Sun American Mortgage REVERSE MORTGAGE / JANUARY-FEBRUARY 2024 23
Today, he is a CRMP and reverse mortgage adviser for Mutual of Omaha Mortgage in Irvine, CA. As he progressed, Sean Skaggs was “pretty disciplined,” says John Skaggs. Sean Skaggs talked to everyone in every department, learning each step of the process, for smoother transactions and minimal post-closing issues. “We’re very proud of him,” says John Skaggs. “He did all of that on his own. Sean’s self-education was a major contribution to our success.” The Skaggs family is actually a three-generation family business since Ellen Skaggs was a lender for her husband’s parents, who sold real estate. Beginnings:The Cooper Family Mitchell Cooper was a BMW service writer, sometimes breaking the news of $14,000 repair bills to frustrated customers. Today, he is a CRMP and reverse mortgage adviser with Mutual of Omaha Mortgage, based in Auburn, CA. His mom is Launi Cooper, a former appraiser who would sometimes sling her infant son in a backpack while conducting appraisals. By 2018, she had been in reverse mortgages for nine years and suggested her son join her. She saw a need for young blood in the industry, and he had always been “so good at empathizing with people.” “He was really curious about the person in the conversation,” says Launi Cooper, CRMP, area sales manager for Mutual of Omaha Reverse Mortgage in Sacramento, CA. “He could interact with the customer in a way that built tremendous trust.” Beginnings: The Downey Family Chris Downey is now co-manager of The Federal Savings Bank’s Massachusetts branch, since Federal’s recent acquisition of Harbor Mortgage Solutions, the XXX continued from page 24 All in the Family continued from page 23 John Skaggs Ellen Skaggs Mitchell Cooper Launi Cooper 24 REVERSE MORTGAGE / JANUARY-FEBRUARY 2024
firm founded by his father, George Downey, CRMP. Chris Downey joined Harbor when the business was primarily an investment advisory firm. He originally reported to his father’s business partner at the time, but when they split, Chris Downey says he followed the “blood is thicker than water department” and went with his dad. As the firm shifted to reverse mortgages, he helped lead the transition. Even during challenging times, the impact of reverse mortgages keeps him in the field. “There’s been no other point in time when this demographic has been more worried and has more reason to worry about outliving their retirement assets,” he says. “The utilization of home equity to supplement traditional retirement savings is not only something that more people are looking at but also an absolute necessity for a growing number.” George Downey, now regional senior vice president of The Federal Savings Bank in Braintree, MA, also brought Chris’ sister, Pam Connolly, into the business, where she oversees back- office operations. Recruiting family simplifies the goal of acclimating team members to a business culture built on doing what’s right for the customer, he says. “Family members are probably predisposed to subscribe to that culture,” George Downey says. “Hiring All in the Family continued on page 26 Chris Downey George Downey Precise Control. Expert Execution. ASSET MANAGEMENT SOLUTIONS Five Brothers’ reputation for integrity, accuracy, and reliability has been built upon a relentless drive towards customer satisfaction. For over 55 years our expertise in nationwide field services, advanced technologies, and unrivaled Reverse/HECM/FHA expertise continues to build value for our customers, while improving communities across the country. Experience the Five Brothers difference… stronger results from the ground up.™ www.fivebrms.com • 855.552.8020 Inspections • Property Preservation • Violation Resolution Utility Management • Registration Services • Hazard Claim Repairs REO Asset Management and Disposition Safe. Sound. Secure. “Hiring the right people has always been very difficult, especially right now. But we have had some extraordinary employees. We’re very lucky now to have the team together that we do because we all work and mesh together very well.” —George Downey, CRMP, regional senior vice president of The Federal Savings Bank REVERSE MORTGAGE / JANUARY-FEBRUARY 2024 25
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