In the Press: The Fox Fixation Let’s begin with the good news: On January 4, an article appeared on the Fox Business website by financial consultant and estate planning attorney Dan Caplinger, entitled, “Reverse Mortgages: What Every Retiree Needs to Know.” It concluded:
“Reverse mortgages can be complicated, but they also offer a unique way to tap your home equity in a way that’s consistent with the typical retiree’s lifestyle. As long as you’re aware of the pitfalls, a reverse mortgage can be a great solution for your liquidity needs while letting you stay in your home for as long as you like.”
Caplinger’s piece was picked up by Fox Business from the website named Motley Fool, whose mission is “building the world’s greatest investment community.”
A week prior to the appearance of this article, an email was distributed by a non-member of NRMLA suggesting that reverse mortgage professionals urge NRMLA to demand equal time on Fox television to respond to a previous piece by Peter Bennett entitled “10 Reasons Why You Shouldn’t Get a Reverse Mortgage.” Some people responded to the non-member’s request and contacted us.
The writer of this negative piece, Peter Bennett, has drifted in and out of the financial services industry for more than a decade, including a stint directing “B2B and B2C communicating for retail banking” at Indymac in 2007-2008, when they owned Financial Freedom, which was still originating reverse mortgages at the time. Bennett’s piece, which contains many questionable arguments, first appeared on the small BankTracker website that offers information about banking, then on the Motley Fool website. Only then was it picked up by the Fox Business website. Our research shows no indication that Bennett’s viewpoint was ever presented on Fox television.
The appearance of two such contrasting viewpoints of reverse mortgages on the Fox Business website is consistent with their inconsistency. Researching recent reverse mortgage coverage on both the site and Fox television news, you find stories that might irk you, followed by some that you’ll respond to with a fist-bump. None of Fox’s website coverage of reverse mortgages that we can find is original, by the way. It is all picked up from other publications. In 2013, for instance, they picked up a very positive story entitled “10 Things You Need to Know About Reverse Mortgages” from Zillow that advocated using the product. Conversely, as early as 2011, they ran a piece entitled “Why Reverse Mortgages Are Not a Retirement Option,” originally published by U.S. News and World Report.
In the Press: A Very Good Year
Focusing on Fox can only make you (or those around you) feel like you’re a manic depressive. But if you want to feel good about your business, you might focus on our overall press results for the past year: In August of 2013, as part of the Extreme Summit effort, we began logging all the reverse mortgage press coverage we could find. Our goal was to have a 3:1 ratio of positive press to negative press. In that first month, the ratio for our industry was 2.4:1 positive to negative. But due to changes in the HECM program, aggressive education of a wider audience and placement of valid stories, the results for 2014 (through November thus far) are 12 positive stories for every negative one.
In the States: F2F Counseling Remains in Effect in MA In January, the Massachusetts legislature failed to restore a two-year delay for mandatory face-to-face counseling.
An amendment postponing face-to-face counseling until August 1, 2016, was approved by the House of Representatives, but failed in the Senate. The vote occurred on the final day of Governor Deval Patrick’s administration.
Board member George Downey and Brett Kirkpatrick, both of Harbor Mortgage Solutions, Inc., issued a joint statement following the Senate vote: “We will be meeting shortly with key legislators, NRMLA leadership, and Rasky Baerlein (our government relations specialists) to assess the situation and plan a course of action for this year with the new legislature and the administration of Governor Baker. We are most grateful for your support, assistance, and participation in numerous meetings with legislators this past year to resolve this critical matter for MA seniors. And, we look forward to your continued help this year. We will keep you updated as developments occur.”
Until the matter is settled, current law requiring face-to-face counseling for borrowers who fall within the income threshold remains in effect.
In-person counseling requirements apply to “mortgagors,” which are defined as applicants for a reverse mortgage who at the time of application: (1) have a gross income of less than 50 percent of the area median income, as periodically determined by HUD; and (2) possess assets, excluding a primary residence, valued at less than $120,000.
Senior Home Equity Increases $94.6 Billion In the third quarter of 2014, the NRMLA/RiskSpan Reverse Mortgage Market Index (RMMI) that measures senior home equity rose to its highest level since the third quarter of 2007. The index finished the period at 183.87.
A $94.6 billion increase in senior home equity in the third quarter was driven by an estimated $97.8 billion increase in the aggregate value of senior housing offset by a $3.2 billion increase in mortgage debt held by seniors. The third quarter of 2014 was the 10th consecutive quarter in which the index has risen, and the $3.84 trillion estimated aggregate value of home equity owned by seniors eligible for reverse mortgages is now just 4 percent below its peak level of $4 trillion in Q4 2006.
The current levels represent a 30 percent recovery since the post-recession trough reached in Q2 2011, when seniors’ equity levels had fallen to an estimated $3 trillion. The senior housing value estimate is based on the Federal Housing Finance Agency’s Q3 2014 all-transactions Indices, which showed quarter-over-quarter increases in housing values for 82 percent of the 412 metropolitan statistical areas covered by RiskSpan.
Save the Dates—2015 Eastern and Western Regionals As members requested, NRMLA is headed back to the Big Apple for the 2015 Eastern Regional Meeting & Expo. For the third consecutive year, the event will take place at the member-favorite Intercontinental New York Times Square from March 26-27.
NRMLA is returning to Southern California for the 2015 Western Regional Meeting & Expo. Join us at the Hyatt Regency Huntington Beach, May 12-13. Registration and sponsorship details will be announced in the coming weeks.
New CRMPs
NRMLA congratulates Marshall Gallop of Reverse Mortgage Funding (Jacksonville Beach, Florida) and Rebecca Koontz of Frost Mortgage Banking Group (Albuquerque, New Mexico) for earning the Certified Reverse Mortgage Professional designation.
New Members NRMLA welcomes the following new members:
- American Preferred Lending, San Diego, California (Lender)
- Bank of Maumee, Maumee, Ohio (Lender)
- Sullivan Financial Services, Inc., Oak Ridge, New Jersey (Lender)
- Synergy One Lending dba Retirement Funding Solutions, San Diego, California (Lender)
