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Dec 08 / Jan 09
editors’ not
Asyouknow,it’s
beenapre:ywildyear.Whew!Wehave
hadourshareofchallengesin2008withthe
greatestfinancialcrisisinourna1on’shistory
andanewPresidentabouttotakeonHUGE
responsibili1es.Whilewetrytoremaincalminaposi1veway,thereisHOPEfor2009,andit’s
rightaroundthecorner.
Allthingsconsidered,wearefortunatetobein
thereversemortgageindustry.Formostofus,
businesshasbeenstableandgrowing.Itmay
nothavegrownasan1cipated,butatleastwe
haven’tseensignificantdeclinesinvolume.We
mustlookbackat2008andappreciatewhat
wehave.
Thankyoutoalltheauthorswhohave
sharedtheirthoughtsandexperiences
withouraudience.Ithasbeennine
monthsofgrowinginthisin1mate,
bou1quespaceofreversemortgages
andwecanonlyimaginewhat2009
willbringforcontent.Weappreciate
eachandeveryone’ssupportinhelping
uscommunicateyourmessagesthroughthispublica1on.
Attheendofthisrollercoasteryear,
ourmessageissimpleThebestholiday
gi`wecanimagineisacontribu1on
tothelessfortunate,regardlessofthe
organiza1onyouchoosetosupport,
givethoughullyandgemannerously.
FromallofusatTheReverseReview ,
wewishyouahappyandprosperous
2009.
EricaEnglish AmanMakkar
Co‐Editor Co‐Editor
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6 reversereview.com
CONTENTS
ESSENTIALS
8 TheBirthofaNew
IndustryMichaelBanner
5 NoteFromtheEditor 7 AsktheUnderwriter 2 IndustrySnapshot
45 Directory
4 HowReverse
MortgagesCanBoost
Obama’sCallto
ServiceAtareE.Agbamu,CRMS
34 YearfortheRecord
BooksWeinerBrodskySidm
Kider,PC
24 LessonsLearnedFrom
2008
Bre:Varner
40 AGuidetoFollowing
UpValerieVanBooven
28 TheReverseMortga
Marke1ngPlanTomEmmerson
6 MovingForwardin
Reverse2009...
AvoidtheFollowing
ErrorsSamCollins
9 TimeManagement
andSalesProduc1vityMonteRose
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Dec 08 / Jan 09
Manyofustrytochangeourliveswithhugecorrec1veinten1onstoundertakeatthebeginningoftheNewYear.Alas,
onechillyJanuarynightwefindourselvessippingonadrink,
withlitcigare:einhandhavingjustcompletedahighcalorie,
highfat,sinfullyindulgingmealwhichweresolvetoourselves
resultedfromtoomuchpressuretogocoldturkeyonallofthe
goodstuffinlifeinashortmomentof1me!!Nowillpower.
For2009,nowthatyouhaveprobablybrokenmostofyoursole
searchedthoughtsfrom2008,whynotreinventyourresolu1on
listandtakeafocusedapproachonthereversemortgage
ac1vityyoudosowell.
Weforgiveyouforbreakingyourresolu1onssoquickly,andknowyouwilltryagainnextyear,but,youarenotoffthehook.
Taketheresolu1onpledgebelowasyourpunishmentforthat
pieceofcheesecakeyoujustatea`ermidnightonDecember
3,2008.
MyhopefortheNewYearisthatweareasmarter,more
efficient,morefocusedproviderofreversemortgageproducts
andresourcesfortheseniorin2009.Iwouldlikeyouto
considerreaffirmingyourinternalwill,bystanding,putdown
yourfork,raisethisar1cleeye‐levelwithonehand,andraise
theotherhandpastthetablewhilereadingaloud
Iresolve,tobethebestreversemortgageloanoriginatorIcanbe...
...toplacetheneedsoftheseniorasmyborrowerabovemy
own,toassistthemineverywayIcanwithissuesofremaining
intheirhomeanda:ainingfinancialstability...
...tooriginatebe:er,tobemoreaccurateandcompleteinwhat
Iputintotheirloanapplica1onpackage…..
...tofillinalloftheboxesonthe009...
...toasktherightques1ons,toknowwhatmyborrowertruly
wantsbyprovidingmyborrowerwithchoicesandsolu1onsthat
meettheirneeds...
...toreadtheImportantTermsdocumentandbeabletoexplain
LIBOR,CMTandtheFixedRate...
...toaskdetailques1onsastothecreditprofileoftheborrower
somyprocessorortheunderwriterwon’tbesurprised...
...toaskforcompletecopiesoftrusts,deathcer1ficates,POA’s,
andotherinforma1onthatwillexpeditetheapprovaland
closingofmyborrower’sfile...
...nottoundertakeamanufacturedhomeasmyfirstloansubmission,toknowabouttags,founda1oninspec1onsand
issuesrelatedtothiscollateralformwhichifle`una:endedt
willresultinfrustra1onforalloftheloanpar1cipants...
...torememberthatsizema:erswhenitcomestophotocopi
ofiden1fica1ondocumenta1onfortheborrowerincluding
picturedid’s,driverslicenses,socialsecuritycards,andothe
proofofiden1tydocuments...
...toaskques1onsaboutmyborrower’sprimaryresidencew
regardtotheroof,theelectrical,thewell,thesep1csystem,
theHVACsystems,thestructureandneededrepairsbeforet
appraisalisordered...
...tobothtakegoodnotesandpassonhelpfulinforma1on
notestomyprocessorandunderwriter...
...toassist,tospeakwithmyborrowersandkeepthemup
todatewiththestatusoftheirfileandquicklyobtainany
addi1onalneededinforma1on...
...tobetolerantandpleasantwhenovercomingobjec1ons
bymyprocessorandunderwriterthattheinforma1onIhave
providedisnotsufficienttoansweraques1onorsa1sfya
condi1on...
...toproperlyverifyfundstocloseorsourceofdownpaymeonallfiles...
...tocon1nuetoeducatemyself,toseekavailabletrainingto
enhancemyorigina1on,processingorunderwri1ngskills...
...toreviewmyapplica1onpackagebeforeIturnitin,tomak
suresignaturesarecompleteandtheinforma1oncontained
thereinisfactualandabletobeverified...
...toassistwithma:ersof1tlebyaskingforneededreleases,
evidenceoflienpaymentsandmortgagerelatedissues...
...tobeawareofdecliningvaluesinmymarketplaceand
understandmyappraiserisusingthebestinforma1onavailable...
...tomakesureIamawareofinsuranceissuesrelatedtofloo
andhazardcoverageandthemortgageeclause...
Andlastly,IresolvetoresolvethatIshallkeepmylistof
reversemortgageresolu1onshandywhenIfearamomento
weakness…..
Wishingyouahealthyandprosperousnewyear…..
ask the underwriteRalphRosy
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Intoday’shighlyvolatilefinancialenvironmenttheReverseMortgagecertainlyseemstoboldlygowherenomortgagehasgonebefore…
Yetthisstaggeringproduct,thatofferssomuchrelieftothesegmentofoursocietythatdeservesitthemost,ourseniors,seemstostillbesowidelymisunderstood.
Thisraisesaveryinterestingquestion.Is theconventionalmortgageindustrythebestvehicletobringthisamazingproducttotheseniorsofourcountry?
Eventoday,somuchremainsunknownaboutthestrengthofthisfinancialtool.Now,thelightofknowledgeisbeginningtoilluminateitsmanyoptions,almostendlessuses,andmostimportantly,thatifusedcorrectly,itcanprotecttheclient’scurrentassets,andinmanycases,createmore wealth.Thisknowledgehasspreadtothefinancialplanningindustry,givingseniors theabilitytopurchasebadlyneededlong- termcareinsurance,purchaselifeinsurancepotentiallytransformingtheirchildren’sinheritanceintoalegacyandevengivingsomeofthatinheritancerightnowwhile theyarealiveandabletoenjoythebenefits withtheirfamilies.Trustedadvisorssuchas
certifiedfinancialplannerscanaccomplishofthis,andsomuchmore.
Already,manytrustedadvisors,throughou thefinancialindustry,haverealizedthepowerofreversemortgagesandareturnin tothemastheanswerfortheirseniorclienInadditiontocertifiedfinancialplanners,longtermcareinsuranceagents,eldercareandestateattorneysandmanymoreareincreasinglyaskingthemselves:Arereversemortgagesreallythatgood?Can wereallyusethemforsomanypurposes?Aremyclientstrulynotobligatedtomakeapaymentintheirlifetime?Moreover,theirmostimportantquestion:Canweofferthisproduct?Canthisbeapartofourproduct
menuforourseniorclients?
Asacareermortgagebanker,27years thismonth,ithasalwaysbotheredmethat themortgageprofessionalhasalwaysbeenlookedatas“thelowestrungonthefinancialprofessionalladder.”Iknow,wedon’tlikediscussingit,nobodyeverwritesaboutit,butweallknowit.Sodowedeser thisreputation?Thismortgageguysays“definitelynot!Forovertwodecadesnowindependentmortgagebrokersandmortgabankershaveoriginatedmoremortgages
inthiscountrythaneverycommercialand
Inatimewhentheentirefinancialindustry,specificallythemortgageindustry,isunderanunprecedentedrestructuring
thereseemstobeashininglight.
Infact,itisduringthetoughestoftimesthatnewindustries themselvesmaterialize,newgiantsemergeandnewideas
createunlimitedopportunitiesthathavealwaysbeenrighttherinfrontofus,yetremainedvirtuallyuntapped.
MichaelBanner
TheBirthofanew
Industry
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Dec 08 / Jan 09
savingsbankcombined.Youwouldthinkthatsta1s1cwould
beenoughtotakeuspre:yseriously.Buttheydon’t…
Weallagree,theReverseMortgageindustryisinitsinfancy.
Well,iftheReverseMortgageistheinfantthenthatmakes
us,theconven1onalmortgageworld,theparents…andlike
allgoodparentswehavetomakesureourinfantgetsevery
possibleopportunitytogrowanddothebestitcanforthegreatestnumberofpeople.
Tothisday,thetradi1onalbankingandmortgagebanking
channelsoriginatethegreatmajorityofthereverse
mortgagesinthiscountry.A`erall,thereversemortgageis
…amortgage!Butitisalsoundeniablythemostinnova1ve
financialplanningtoolintroducedtotheseniorsegmentof
thisna1onindecades.
Asstatedintheveryfirstparagraphofthisar1cle,the
mortgageindustryisinthemidstofatotalrestructuring.
Whynotusethisrestructuringtoallowthemortgageindustrytochange,togrow,toevolve,andtotakeitsproper
placeinthefinancialindustry.
TheReverseMortgageistheproductthatwillallowustodo
justthat.
Throughoutthiscountrytherearemillionsoffinancial
planners,lifeinsuranceagents,longtermcareinsurance
agents,longtermcareproviders,inhomecareproviders
andmanyotherindustriesthat“touch”theseniorsegment
ofoursociety.Theyhaveexis1ngbooksofbusinessof
clients62yearsofageandaboveandevenmoreclientsbetweentheagesof40&50thataregreatlyconcerned
abouttheirparentsqualityoflife.Thisisthefutureofthe
ReverseMortgageoriginator.ThisisthefutureoftheReverse
Mortgageindustry!
TheReverseMortgageunleashesthedeepestandmost
untappedequityinthecountrytoday,es1matedat9trillion
dollars,increasingtoinexcessof32trillionasthebaby‐
boomersreachre1rementage.Amortgagewithabelow
marketinterestrate,noincomeorcreditqualifica1onsalong
withnopaymentsforthelifeoftheloandoesn’tmakeit
theul1matemortgageofthe2stcentury,itmakesitthe
ul1matefinancialplanningtoolofthe2stcenturyforour
seniors!
Obviously,therearemanycaseswhereafinancialplanner
isnotneeded.TheReverseMortgageindustryhashad
record‐breakinggrowthoverthelastseveralyearsmostly
throughtheconven1onalmortgageworld.Butweallknow
wehaven’tevencomeclosetoscratchingthesurfaceofthe
poten1alvolumeofthisproduct.Why?
Theanswerissimplebutnotsomethingtheconforming
mortgageworldlikestohear.Seniorci1zensarefine
discussingamortgagewithamortgagepersonbutthey’r
notcomfortablediscussingtheirfinancialfuturewiththe
Addi1onally,theirchildrenarenotcomfortablewithit.Th
arehowever,verycomfortablediscussingtheirlongterm
careneeds,theirtrust,theirlifeinsurance&investment
needswiththeirfinancialplanner,alongtermcareprovidtheireldercarea:orneyoranynumberoftrustedsenior
advisors.
Intheseincrediblyvola1leeconomic1mestheReverse
Mortgageistheproducttrustedsenioradvisorsneedto
guaranteethehighestqualityoflifepossibletotheirsenio
clients.
AlmostoneyearagoMetLife,oneofthena1on’soldest
andlargestinsurancecompanies,announceditsacquisi1o
ofEverBankReverse,oneofthemostsuccessfulreverse
mortgagewholesalersinthena1on.DanDeKeizer,vicepresident&actuaryofMetLifeRe1rementStrategiesGro
saidatthe1me,“thefocusofMetLifeBankisonhelping
seniorsmaximizetheirre1rementincome,includinghelp
themconverttheirassetsintoincometosupportthelifes
theywant.”Healsonoted,“ThatformanyAmericansagin
inplaceisimportanttothemandaReverseMortgageisa
naturalsolu1on.”DonnaDeMaio,PresidentofMetLifeBa
added,“Theacquisi1onofEverBankReversewillhelpus
rapidlygrowthisbusinessandstrengthensMetLife’sposi1
asaninnovatorinhelpingAmericansmakethemostofw
theyhaveinre1rement.”
Now,thena1on’sfinancialindustryisbeingreshaped.Me
giantssuchasMetLifehaveguaranteedthattheReverse
Mortgagewillplayalargepartinthatreshaping.Andlet’
faceit,Snoopyisveryrarelywrong!
Theconven1onalmortgageworld’sbestfriendshavealwa
beentheprofessionalRealtor,theirlocal1tlecompany,th
telemarketer,orinthecaseofthena1onalplayers,their
predic1vedialer.
TheprofessionalReverseMortgageoriginatorwillbebest
friendswiththemanytrustedsenioradvisorsthattouchsomanyseniorsinourna1onandhavethebestchanceo
maintainingandinmanycasesevenbe:eringtheirqualit
lives.
Beapartofthisnewworld,it’sdifferent,it’sbe:er.Ican
youfrompersonalexperience,itfeelsgreat!
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10 reversereview.com
TomEmmerson‐TheReverse
Mortgage
Marke&ngPlan,
page28
TomEmmerson
istheVPofSales
forDirectGroup
MortgageMarke1ngDivisionhas
5yearsofdirectmailexperience
–ofthoseyearsinmortgage
marke1ng.Hehasdesignedand
copy‐wri:enmailersforsomeof
thetopcompaniesinAmericasuchasGNC,AmericanExpress,Merrill
Lynch&AlliedHomeCapital.
Bre$
Varner
‐LessonsLearnedFrom
2008,
page24
Bre:Varner
istheVPofProduc1onfor
OMNIReverse.Withover5
yearsofbusinessmanagement
experiencecenteredonsales
development,customerservice
andopera1onsefficiency,Mr.
VarnerjoinedOMNIin2006to
helpdevelopenhancedsalesa
workflowsystems,andtocreat
anintegratedtrainingsystem.
HeearnedhisMBAfromthe
UniversityofRedlands.
contributorsRalphRosynek‐ AsktheUnderwriter ,page7
RalphRosynekisPresidentandCEOofstReverseaswellasaHECMDEUnderwriter.Mr.Rosynekhasbeeninvolved
inmortgagelendingforover30yearswiththelast5+years
exclusivelyprovidingreversemortgagelendingsolu1ons.
TocontactMr.RosynekortolearnmoreaboutstReverse
FinancialServices,Pleasevisitwww.streverse.comorcall
877.574.000.
JohnLunde‐Reverse
Market
Snapshot ,
page2
JohnLundeis
Presidentand
founderofReverseMarketInsig
thepremiersourceformarket
intelligenceandanaly1csservic
inthereversemortgageindustry
RMIclientsincludefiveofthetotenreversemortgageoriginators
bothlenderandindependent
servicers,aswellassomeofthe
largestfinancialservicesfirmsin
theworld.Findoutmoreatwww
rminsight.netorcall949.28.64
SamCollins‐MovingForward
inReverse2009... AvoidtheFollowing
Errors,page6
SamCollinsisthe
PresidentofSamCollinsReverse
Marke1ng,LLCandFounderof
REMALO,theReverseMortgage
Associa1onforLoanOfficers.
REMALOisawebbasedNa1onal
sales,marke1ng,training,andfull
servicecenter,createdexclusively
forReverseMortgageLoanOfficers,Correspondents,Branch
Managers,andkeyexecu1ves,and
brokers.www.remalo.org
JoelSchiffman‐YearfortheRecordBooks,page34
JoelSchiffmanandFedKamenskyarea:orneysofthelawfirmofWeinerBrodskySidmanKiderPC.
ThelawfirmservesasGeneralCounseltoreverse
mortgagelendersandotherindustrypar1cipants
throughoutthena1on.Thefirmhasofficesin
Washington,DC,NewportBeachandHouston.
Addi1onalinforma1onmaybefoundatwww.wbsk.comorbytelephone
at202.628.2000.Messrs.SchiffmanandKamenskymaybereachedat
[email protected]@wbsk.com.
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Dec 08 / Jan 09
AtareE.Agbamu,CRMS‐HowReverseMortgagesCanBoostObama’sCallto
Service,page4
AtareAgbamuistheauthorofThinkReverse!(The
MortgagePress,comingthisfall)andmorethan00
ar1clesonreversemortgages.Areverse‐mortgage
specialistinMinnesotaandanadvisertoins1tu1ons
acrossthecountry,hewritestheForwardonReverse
columninTheMortgagePress,since2002.Atarecanbereachedbyemail
MichaelBanner‐TheBirthofaNewIndustry ,page8
President&CEOofLoanWellAmericaInc.,Michaelhas
beeninthemortgageindustryfor27years.HeisoneoffewReverseMortgageprofessionalsaccreditedtoteach
con1nuededuca1onclassesforCFP’s,CPA’s,a:orneys
&insuranceagents.Aprovensenioradvocate,heisa
memberofNRMLA’sState&LocalIssuesCommi:eeand
sitsontheBoardofDirectorsfortheFPAofTampaBay.Michaelhasbeen
interviewedbytheWallStreetJournal,theTampaBayBusinessJournal,
Sr.MarketAdvisor&TheReverseMortgageWireaswellasnumerous
otherReverseMortgageInternetsites.
MonteRose‐TimeManagemen
andSalesProduc&v
page9
MonteRosehas
helpedhundreds
ofseniorsobtaina
reversemortgageduringthepast
years.Heisanaccomplishedspea
andwidelyquotedindustryexper
appearinginfinancialpublica1ons
andna1onallysyndicatedmedia.
Hewasheadofna1onalretail
salesforFinancialFreedomSeniorFundingCorpora1on.Monteis
aCer1fiedSeniorAdvisoranda
Cer1fiedstrengthsCoachwithGa
University.Formoreinforma1on,c
800.56.0545oremail
FedKamensky‐YearfortheRecordBooks,page34
JoelSchiffmanandFedKamenskyarea:orneysofthe
lawfirmofWeinerBrodskySidmanKiderPC.
ThelawfirmservesasGeneralCounseltoreverse
mortgagelendersandotherindustrypar1cipants
throughoutthena1on.Thefirmhasofficesin
Washington,DC,NewportBeachandHouston.
Addi1onalinforma1onmaybefoundatwww.wbsk.comorbytelephone
at202.628.2000.Messrs.SchiffmanandKamenskymaybereachedat
[email protected]@wbsk.com.
Valerie
VanBooven‐AGuideto
FollowingUp,page40
ValerieVanBoove
RNBSNisaSenio
ServiceMarke1ngExpertandthe
Na1onalMarke1ngDirectorfor
NextGenera1onFinancialService
aDivisionofstMarinerBank.
Sheisaprofessionalspeakerand
theauthorofthebooks“Aging
Answers”(2003)and“TheSeniorSolu1on”(2007).Shecanbe
reachedat
Pleasevisitherwebsiteatwww.
myseniorservice.com
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12 reversereview.com
reverse mortgage industry snapshot
0Regions,rankedbyHECMunitvolumeYTD.IncludingrankchangefrompriorYTD,aswellasgrowthrates.
Alsoincludesac1velendersandgrowth
Lenderdistribu1ongraphandtable,showingnumberoflendersgrowingatvariousgrowthratesYTDvs.prior
YTD,includingvolumea:ributabletoeachgroupoflenders.
ClientNo6ces
) HelpimprovedataqualityintheReverseMortgageindustry.Ifyoubelieveyourcompany’snumbersonthisreportareinaccurate,pleaseemailus(support@
rminsight.net)andwewillreviewyourfeedbackpromptly.Pleaseincludeyourname,companyandcontactinforma1onalongwithathoroughdescrip1onofthe
suspectedinaccuracy.Thanks!
2) Ifyoureceivedthisreportasatrialorsampleandwouldliketopurchasethisreportorfuturereportsforyourcompany,pleasevisitwww.rminsight.net/MICrepo
php
3) Ifyou’vebeenlookingforasourceforReverseMortgageintelligencebeyondMICendorsementnumbers,we’vegotjustwhatyouneed.Findoutmoreatwww.
rminsight.net/rmarket.php
Rank Chg 2008YTD YTDChg% 2008 Chg%
1 1 24,679 22.41% 820 110.8%
2 -1 18,866 -14.35% 735 53.77%
3 - 11,880 16.76% 379 114.12%
4 - 9,894 3.78% 491 67.01%
5 1 8,696 27.75% 294 90.91%
6 -1 6,943 -3.23% 293 92.76%
7 1 5,632 14.43% 278 86.58%
8 -1 5,206 -13.78% 296 56.61%
9 - 3,424 23.97% 177 58.04%
10 - 2,424 0.58% 165 89.66%
97,644 6.12% 2,756 84.35%
Great Plains 2,827 2.482% -5.22%
Industry Totals 108,287
New England 6,963 5.332% -18.75%
Rocky Mountain 3,296 3.507% 16.82%
New York/New Jersey 8,322 7.111% -8.82%
Northwest/Alaska 5,790 5.768% 7.82%
Midwest 11,434 10.133% -2.21%
Southwest 8,073 8.906% 20.38%
Pacific/Hawaii 25,612 19.321% -19.29%
Mid-Atlantic 11,956 12.167% 10.02%
Region 2007TOT 2008YTD Chg%
Southeast/Caribbean 24,014 25.274% 15.35%
Endorsements Active Lenders Region Share
16,209
New Lenders1,509 11,353
301% to 400%34 4,045 858
over 400%138 10,201 899
101% to 200%98 4,885 2,021
201% to 300%49 1,641 463
-99% to -1%548 44,221 69,300
0 to 100%380 21,298
Growth Rate Lenders YTD MIC Last YTD
-100%
248 2,260
LenderDistribu1onbyYTDGrowthRate
Sta1s1csProvidedbyReverseMarketInsight‐October2008
Top0RankingsbyRegion
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Dec 08 / Jan 09
2yeartrendgraphofmonthlyHECMunitvolumeandindustrypenetra1onagainst62+homeownerhouseholdsna1ona
Appendix
)Allsta1s1csbasedonretailorigina1onsfromHUD’sMonthlyHECMMICreports
2)Loansareinunitvolume,basedonHUDreportedmortgageinsurancecer1ficateissuance
3)LendersareaggregatedusingHUD’slenderiden1fica1onnumbersanduniquelendernames,alongwithfeedbackfrom
repor1nglenders
HUDRegionsandCorrespondingStates/Territories
Region‐NewEngland
Connec1cut
Maine
Massachuse:s
NewHampshire
RhodeIsland
Vermont
Region2‐NewYork/NewJersey
NewYork
NewJersey
Region3‐Mid‐Atlan1c
Delaware
DistrictofColumbia
Maryland
Pennsylvania
Virginia
WestVirginia
Region4‐Southeast/Caribbean
Alabama
Florida
Georgia
Kentucky
Mississippi
NorthCarolina
PuertoRico
SouthCarolina
Tennessee
U.S.VirginIslands
Region5‐Midwest
Illinois
Indiana
Michigan
Minnesota
Ohio
Wisconsin
Region6‐Southwest
Arkansas
Louisiana
NewMexico
Oklahoma
Texas
Region7‐GreatPlains
Iowa
Kansas
Missouri
Nebraska
Region8‐RockyMountain
ColoradoMontana
NorthDakota
SouthDakota
Utah
Wyoming
Region9‐Pacific/Hawaii
Arizona
California
FederatedStatesofMicron
Hawaii
Nevada
Region0‐Northwest/AlaAlaska
Idaho
Oregon
Washington
0.00%
0.20%
0.40%
0.60%
0.80%
1.00%
1.20%
1.40%
1.60%
1.80%
6000
8000
10000
12000
2006-11 2007-3 2007-7 2007-11 2008-3 2008-7
P e n e t r a t i o n
U n i t s
MIC Units Penetration %
24MonthPenetra1onandUnitVolume
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14 reversereview.com
How Reverse
MortgagesCan BoostObama’s Call
to ServiceAtare E. Agbamu, CRMS
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Dec 08 / Jan 09
Reversemortgagescanpromotevolunteerismamongaging
babyboomersandsupportPresidentBarackObama’scallto
communityservice.
ThatwasalessonItookfrommyconversa1onwithPauland
IreneAlexanderofHampstead,NewHampshirewhenIwas
researchingmyrecentlyreleasedbook.
Pre‐babyboomersandlife‐longvolunteers,theAlexanders
areparentsandgrandparents.Paulre1redasahuman
resourcemanager,andIreneservedasalawfirm
recep1onist.Theybelievethereversemortgagetheytook6
yearsagogavethemthefreedomtofocusonhelpingothers
intheircommunity.
“Fromacontribu1onbasis,wewereabletoconcentrateon
contribu1ngtootherpeople’squalityoflife,aswellasour
own,”PaulAlexandersaid.
Un1lPaultookillthreeyearsago,theAlexandersdevoted24hoursaweek(or,248hoursayear)tovolunteerwork.
Na1onally,in2007,about6millionpeoplevolunteered
intheircommuni1esandgave8.billionhoursofservice
valuedat$58billion,accordingtotheCorpora1onfor
Na1onalandCommunityService.VolunteeringinAmerica
reported,between2005and2007,3.2percentofboomers
gave52hoursayeartotheircommuni1es.At78million,
BabyBoomerscoulddoublethenumberofolderadult
volunteersinthecomingdecades.
Theywillhelpaddressneedsineduca1onandotherareas.Ineduca1on,forexample,wewillneedmorethan2million
newteachersinthenextdecade,especiallyinmath,science,
andspecialeduca1on.Theteachershortageisacuteinurban
andruralschooldistricts.Becauseofexpectedstructural
shortageofskilledyoungerworkersandcompe11onwith
otherindustriesforsuchworkers,severalba:alionsof
Obama’s“armyofnewteachers”willhavetocomefrom
highly‐educatedre1redbaby‐boomers.
AsPaulAlexanderknowsverywell,theextracashandthe
no‐monthly‐mortgage‐paymentbenefitofreversemortgages
cangiveboomersthefinancialleewaytoheedObama’scalltoservetheircommuni1es.
“Ifwehadtoworktopayourmortgage,that’sadifferent
story.Wewouldn’tbeabletomakethosecontribu1ons.Itis
agreatsocialplus.It[reversemortgage]istrulyoneofthe
bestthingsthathashappenedtothiscountryinalong1me,”
hesaid.
UnliketheAlexanders,manybabyboomersmayhaveto
workbecausemorethanhalfofthemhaveamortgage
paymentobliga1on.AccordingtoaMetLifeMatureMark
Ins1tutedemographicprofile,56percentofyounger
boomerscarryamortgage.Amongolderboomers,itis53
percent.Theseboomerswillenterre1rementwithsome
monthlymortgagepaymentburden.
Whilesomemayfindmeaningfulworkthatwillalsosupp
thecashtheyneed,othersmayhavetose:leforworkth
maynotfullyusetheirskillsandeduca1onorgivethemt
flexibilitytheyneedinpost‐re1rementwork.Thatiswher
reversemortgagesolu1oncomesin.
Howcanreversemortgagesaidvolunteerism?Therearea
leasttwoways.First,dependingonmortgagebalanceand
equityavailability,areversemortgagestopsthemonthly
nega1vecash‐bleeding.Secondly,itincreasesposi1vecas
in‐flow,givingtheboomerbudgetaryla1tudetomixleisu
withcommunityservice,enhancinglifesa1sfac1on.
Thephysicalandthepsychologicalhealthbenefitsof
volunteerismarewell‐documented.Withamassiveand
permanentagingpopula1onunderway,thepublichealth
valueandtheresul1nghealthcaresavingsofvolunteerism
cannotbeunderes1mated.Therefore,policymakersshou
lookathowreversemortgagescanbeusedtoadvance
volunteerismamongbabyboomers.
OnewayisforanObamaadministra1ontoaskCongressf
moneytowaivetheHECMreversemortgagetwo‐percentupfrontmortgageinsurancepremiumforeligibleolder
adultswhohavegivenatleast500hoursofdocumented
communityservicetwoyearsbeforeapplyingforarevers
mortgage.AnotherisforCongresstogivea$6,000taxcre
forthosewhogave,000hoursofservicetwoyearsbefo
gengareversemortgage.
Duringthepresiden1alcampaign,Obamapromiseda
$4,000collegetui1oncrediteachforstudentswhocomm
toserviceasteachersinhigh‐needcommuni1es.Similar
incen1vesshouldbeconsideredviareversemortgagesfo
thelegionsofolderadultswhoforgore1rementleisuretoservetheircommuni1esandenrichourna1on.
Thinkreverse.Moveforward!
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Tobesuccessfulinthereversemortgagebusiness,youneed
totalktomanyseniorclients.Howdoyoudothat?You
needtolearntomarketandavoidtheerrors.Errorsin
marke1ngcostyou1meandmoney.Noma:erhowyou
sliceit,yourchancesofbeingprofitableinanybusinessare
limitedifyouhavepoormarke1ngskills.Theleastcostly
waytoavoiderrorsistolearnfromthemistakesofothers
andmakesureyouavoidthem.
Iwanttosharewithyouaculmina1onof38yearsofexperienceandhowyoucanavoidthemostcommonerrors
madeinmarke1ng.
#ALousyADwillgetlousyresults
Makesureyourcontentisinteres1ng,butmoreimportantly
yourmarke1ngmusthaveaninteres1ngheadlineorinterest
pointtoinvokeabenefitandcreatecuriosityforyoursenior
client.Yourprimaryobjec1veistoavoidbeingthesameas
everyoneelse.
#2EitherNoOffer,oraLousyOffer
Whenyouareprospec1ngfornewseniorclients,youmust
ask,“Whatdoesittakeforsomeonetowanttorespondto
me?”Yourofferhastoberelevanttoyourseniormarket’s
interests,desires,needsandwants.Youmustbesureto
includeanofferinyourmarke1ngapproach.Youroffer
mustbeonethatappealstoyourSeniorClients.Youmust
viewyourinvestmentinseniormarke1ngasa“lifelong”
clientanddeterminehowyoucancul1vateyourbusiness
nowandinthefuture.Youroffershouldbeasgenerousa
youcanafford.Keepinmindtheacquisi1oncostsandth
poten1alprofitsperorigina1on.
#3Crea1ngaTimelineorDeadlineforYourClient
Crea1nga1melineforyourseniorisdifficult.Itcouldbe
1mingisnotrightforthemwhenyoumarkettothem.Yo
needtoapproachthe1melinewiththeatudeofafutu
businessopportunity.However,crea1ngasenseofurge
anda1melineiss1llimportant.Theimportantthingfory
torememberisthatthetortoiseisprobablygoingtowin
raceoverthehare.
Yourseniorprospectisgoingtomoveforwardwhenthey
ready,notwhenyouareready.
Yourgoalistobecomemoreconcernedaboutmakingyo
seniorsfeelgoodaboutthemselvesmorethanaremaking
themfeelgoodaboutyou.
#4LackingProofElementsorTes1monials
Areyoua:endingeveryseniorloanclosing?Ifnotnowis
the1metostart.Reversemortgageclosingsareusually
veryhappy1mes.Closingisthe1meyouwanttoask
fortes1monialsfromyourhappyseniorclients.Ifyou
areunabletoa:endaclosing,youwanttofollowup
withaThankYoucard,survey,andincludecomments
fortes1monials.Usethesefollowupproceduresinyour
marke1nginprint,audioorvideo.Obviously,youwantto
getpermissionbeforeprin1ng.
I don’t know about you but I’m ready for 2009. There is something about the NewYear, it means a new beginning. A way to move out the old and move in the new.
When I entered the reverse mortgage business, my biggest concern was learningas much as I could about the business as quickly as I could. I soon discovered thereverse mortgage business was not about reverse mortgages at all. The reverse
mortgage business is all about marketing. If you don’t know how to market theproduct, then knowing all the technical aspects about the business is useless.
Moving Forward in Reverse 2009 ... Avoid the Following Error
Sam Collins
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Dec 08 / Jan 09
#5FailurestoGiveAssuranceoraGuarantee
ForusintheReverseMortgagebusinesstheguarantee
assuranceistheFHAMIP,mortgageinsurancepremium
feature.Youwanttoemphasizethiso`eninyourmarke1ng
efforts.Yourseniorclientsarealreadyscaredofthewhole
“mortgage”process.Whenyougiveyourseniorthis
reassuranceitwillsignificantlyreassurethemandassistthemintheirdecisionbeforemovingaheadwithaReverse
Mortgage.
#6MeTooLookAlikeorAppearance
Whenconsideringyourmarke1ng,trytoavoidthe“metoo”
appearance.MostReverseMortgagemarke1ngmaterials
haveadis1nguishingcommonthread,theyalllookthesame
andhavethesamemessage.Yourgoalistodis1nguish
yourselfandyourproductdifferentlytoyourseniorclient.
Thisapproachwillsetyouapartfromyourcompe11onand
produceresponsesfargreaterthanthemetoomarke1ngpieces.
#7FocusontheClientinsteadoftheWIIFM
Manycompaniesandmarketersaretrappedinthe“I’mthe
greatestormostwonderfulcompanyormostwonderful
persontodobusinesswith”.Trytoavoidthistrap.Your
seniorclientwantstoknow“WIIFM”(What’sInItForME).
Avoidthe“justanotherSalesman”trap.Seniorshavean
uncannywayofbeingabletospotasalesman.Fromthe
senior’sviewpoint;salesmenareoutforthemselves,not
theirclients.
Anotherobjec1veismakingsureyouaddvaluethatyour
seniorclientswillappreciateandrecognize.Whenyour
seniorclientknowsandrelatestowhattheyvalue,thenyou
makeyourselfmorevaluableandyourseniorclientswill
appreciateyouradviceandrela1onship.
#8A:emp1ngtoAccomplishtooManyObjec1ves
Mostmarke1ngcampaignstrytoaccomplishtoomany
objec1ves.It’sonlynatural.Youarespendingalotof
moneyandyouthinkthisisthewaytomaximizeyourinvestment.However,yourgoalisonethingandonething
only,RESPONSE.Yes,youwantyourseniorclienttorespond
toyou.Therefore,yourchanceofgengaresponsegoesup
drama1callywhenyouconcentrateononeobjec1veinyour
marke1ngpiece.Theresponseisgengthecall,sengthe
appointment,takingtheapplica1on.Gengprospectsto
respondshouldbeyourprimaryobjec1veinyourmarke1ng
approach.
#9FailuretoTellSeniorsYourStory
Thebestwaytobuildatrus1ngrela1onshipwithyour
seniorclientsisthroughastory.Seniorswanttoknowhow
aReverseMortgagewillbenefitthemandmakeanimpac
intheirlives.Don’tbeafraidtotellthemthedownsideo
ReverseMortgage.Formostseniors,lifeexperienceshav
proventheyalreadyknowitandtheyarejustwai1ngtosifyouhavethenervetotellthemthetruth.
Atruelifestoryofhowyouoryourteamhavehelpedsen
inthepasttobecomemorefinanciallysecureandhowth
u1lizedtheirhome’sequitytorealizeimprovementstoth
livesandtheirhome,isaneffec1vewaytoshowthemho
othershavebenefitedfromareversemortgage.
Effec1vecommunicatorsknowtheirmessage.“Anyoneca
steerashipbutittakesaleadertochartthecourse.”You
wanttobeagoodleaderforyourseniorclients.
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Beforeyouarriveatyourappointmentyoushouldask
yourself:
Whatistheprimarypurposeofmyvisit?•
HaveIpreparedmyseniorclientformymessage?•
Whatelsewilltheyneedtoknowtomakeanintelligent•
decision?
Whatdoesmyseniorneedtoknowtodo?•
CanImakemypresenta1onconnectwithmysenior?•
#0AvoidBeingCute
Mostmarketersthinkcuteisremembered.Trytoremember
thecuteadsthatranintheSuperBowllastyear.Did
thoseadss1ryoutopurchasetheirproduct?Myguessis
probablynot.Bo:omline,cuteisrememberedascute,
butmostlikelyendsupsellingnothing!Keepinmindwe’re
dealingwithseniorsinourmarke1ngandtheyareprobably
scaredashecktoevenconsideranythingthatresemblesa
“Mortgage”regardlessoftheproofwegivethem.
Putyourselfintheclient’sshoes.Imagineyourselfre1red,
youarereceivingnoweeklypaycheck,onlysocialsecurity,
andnowthereisastrangersinginyourlivingroomtrying
tosellyouamortgage.Nextyourseniorclientisthinking,
“Iworkedagoodnumberofyearstopayoffthemortgage,
you’retellingmetotakeoutanotherone?”Wow!Don’ttry
tobecute…we’redealingwithseriousma:ersthataredear
tooursenior’sheartandmindset.
InSummary
HereisyourhomeworkandIwantyoutostarttoday.
Remember2009isyourcueforanewbeginning.Start
collec1ngallthedirectmailpiecesyoureceiveathome.
Startreadingtradejournalsandadvertorials.Collectyou
marke1ngpiecesinalargebox.Onceaweek,justtakeo
hour.Sortthroughtheadsandtossouttheonesyoudonotlike,butkeeptheonesyoulike.Thinkoutsidethebo
and“braindump”astohowyoucanmakethegoodones
rela1vetoyourseniormarket.A`erprac1cingthisproce
forawhile,yourmindwilltakeonawholenewworldof
crea1vity.Youwillbecomeengagedandexcitedaboutyou
opportuni1es.Giveyourideaatest.Mailoutabout00
testpiecesandmeasuretheresponse.Iftheywork,you
haveawinner.Ifnot,youhaven’tbrokenthebank.Go
backtoyourboxoftricksandbraindumpagain.Repeat
process.S1ckwithit.
Thewinnerinourbusinessis“STEADYASSHEGOES”.Theconsistent,organized,compassionate,andwellrespected
marketerwhoisconstantlyanalyzingtheirmarke1ngfrom
starttofinishandeventuallygetstothefinishlineisa
WINNER!
Bestoflucktoyoursuccessin2009.
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8/14/2019 The Reverse Review December 2008 January 2009
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Dec 08 / Jan 09
Salesproduc1vityisa“mul1‐factorial”problem.Whatthis
meansisthatseveralkeyelementsmustbeinplacebefore
predictableproduc1vityhappens.Therearepersonality,
behavioral,strategic,andexecu1ondimensionsthathaveto
allcometogetherbeforesuccesshappensinaconsistentand
sustainablemanner.
Inapreviousar1cle(TheFounda1onsofEffec1veExecu1on),
Iintroducedtwoconceptsthatmustbeaddressedin
coachingbreakthroughsalesperformance(a)theabilityto
consciouslymanageone’s“Skills‐Brand‐Reach”porolio,
and(b)theuseofasystemic1meandenergymanagement
approachsuitedtotheindividualsalesperson.
Ideally,integra1ngthesetwoideasinthesimplest
possibleway(inreal1me)resultsineffec1veandefficient
salesperformance.Thechallengeishowtocustomizea
produc1vitysystemthatisbothsimpleandsophis1cated
enoughtoprovidealearningfeedbackloop.Thisallowsthe
manager(andtheproducer)anintelligentwaytochange“thegame”basedonthesuccessofthesalesbehaviors,as
wellasthechangesinthemarket’srequirements.
Timemanagementsystemsinandofthemselvesdonot
guaranteeresults.Efficiencydoesnotalwaystranslate
tosalesresults.Themostobviousreasonisthatthe
correctdirec1on(orinsight)mustfirstbedetermined.
AsI’vemen1onedbeforeinearlierar1cles,successful
produc1onoccurswiththeunityofcorrectinsightwith
consistentac1on.Anditispreciselythela:erideathat1
managementaddresses.Withoutcontrollinginsight(and
therightlevelandqualityofmo1va1onandgoalclarity),
theshellof“1memanagement”technologydegenerates
intowastedenergyatitsbest,andtheverysourceofcare
distrac1onatitsworst.
Therearepeoplewhosurvivewithoutanysophis1cated
1memanagementsystems,providedtheyhavetheright
energyandsustainedtac1calexecu1ononadaytodayba
However,mostpeoplewhoachievebreakthroughresults,
bydefini1on,havealmostalwaysfashionedasuccessful
personalsysteminmanagingtheirworkweek.
Mostsalespeoplearenotconnoisseursof1memanagem
theories.Myownviewonthema:eristhatformfollows
func1on.Forminthiscaseisthe1me“system”thatone
uses,whilefunc1onreferstotheworkloadofprospec1ng
andconver1ngthateverysalespersonmustdoregularly.
Havingsaidthat,it’ssome1mesveryusefultoexplorewhat’souttherethatcanshortenourproduc1vitylearnin
curve.Effec1ve1memanagementisacrucialsurvivalskil
especiallytobeginningproducerswhoaretypicallyswam
withthechallengesoflearningtheproduct,understandin
theseniormarketplace,andnaviga1ngtheback‐office
terrain.
Lakein’sA‐B‐Cpriori1za1onframeworkandCovey’stop‐
downsystemhavebeentheestablishedapproachesinth
Time Management
and
Sales Productivity
Monte Ro
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1memanagementfield.Morerecently,DavidAllen’ssystem
(GengThingsDone)hasbeenincreasinginpopularitysince
thebook’spublica1onin200.
Allen’ssystemhashadalotoftrac1oninthecorporate
trenches,specificallyamongknowledgeworkerswhoare
swampedwithcommitmentsandinforma1onoverload.The
basicconceptofGTDisgengallthe“stuff”thatentersyourlifeoutofyourheadandintoa“trustedsystem.”Forhis
followers,Allenprovidesasystemthatreducesstressanda
structuredapproachtohandlingtheincreasedcomplexity
oftoday’sworkenvironment.UnlikeCoveyorTomPeters
whofocusonMission,Vision,andGoals,Allen’sbo:oms‐
upapproachinvolvescollec1ngandprocessinginforma1on
intoasophis1cated“filingsystem”andretrievingthem
throughdailyandweeklyreviews.Hepopularizedtheidea
of“contexts”whicharesimplybucketsoftasksthathave
thesameloca1onorsourceofac1on(e.g.,home,office,
errands,phonecalls,etc.)
Allen’sapproachcanbequiteeffec1veforsalespeople,
dependingontheindividual’spersonalityandpenchantfor
detail.Becauseitisaverysophis1catedsystemtolearnand
implement,itsome1mescanhaveaverysteeplearning
curve.ThemostimportanttakeawaysfromGTDarethe
conceptsofNextAc1on,theWeeklyReview,andtheideaof
UbiquitousCapture.
NextAc1onsaredefinedasthesingularac1onthatmoves
aprojectorgoalforward.(Forexample,“BuyaHouse”is
notaNextAc1on.Rather,itisa“Project”withamul1tudeofnextac1onsthatneedtobedonemostlyinsequence.)
TheWeeklyReviewreferstosystema1callylookingatopen
loops(ac1onsthatwerestalled,aswellasnew“stuff”that
hascomeinduringtheweekthatneedstobeprocessed).
UbiquitousCapturereferstothehabitofwri1ngdownideas,
informa1on,andcommitmentssothatyoucandoand
deliverwhatneedstobedone.Thisisanimportanthabitto
cul1vatewhenyouwanttoimpressclientsandcolleagues
aboutbeingaprofessionalwho“neverdropstheball.”
Themaincri1cismofGTDhasbeenthelackofapreciseand
systemicwaytoaddressthewholeissueofpriori1za1on.GTDcanmakesomeoneextremelyefficient,buts1llnot
achieveexcellentproduc1vityintermsofsalesresults.
However,inallfairnessthiscri1cismoftheGTDapproach
hasmoretodowiththeclarityofgoalsandstrategicinsight
ratherthanthemethoditself.Forthosewhoareinterested
inlearningmoreaboutGTD,IstronglyrecommendDavid
Allen’sbook.Mostsalespeoplewhousethesystemcreate
theirownmodifica1onstosa1sfytheuniquechallengesof
theirworkflow.Youdon’thavetoimplementeverythingthat
Allenwritesaboutforyourgametoimprove.Everyli:le
thingyoupickupandapply(e.g.,howtosetupa1cklerfi
orafilingsystem)canandwilltransformyourproduc1vit
andcapacitytodealwithstress.
Themostrecententrantinthe1memanagement
conversa1onisMarkForster,aBri1sh1memanagement
consultantwhowrotethebookDoItTomorrow,publishein2006.IfindForster’sideassimpleandeasytoimpleme
andpoten1allyhelpfulforsalespeople.Thekeyconcepto
DITistheideaofmaintaininga“closedlist.”Theculpritsi
non‐produc1vedayaretypicallythecountlessinterrup1o
thatpreventusfromtacklingourto‐dolists.Inmy
experience,salespersonsaremoresidetrackedbytheirow
lackofstrategicdailyac1onplansthanexternalinterrup1
fromclientsorcorporatecolleagues.Corporatefolksare
thosewhonormallyexperienceexternaldemands.Inbot
casescrea1ngandimplemen1ngan(insight‐based)strate
closedlistbecomesthefounda1onofproduc1vityand
results.Forsalespersons,thisalwaysgoesbacktoeffec1vandefficientprospec1ngandconver1ng.Everythingelse
tosupportthesetwofounda1onalac1vi1es.
Forsterarguesthatthebaneofproduc1veexistenceis
theproblemofthe“openlist”thatisconstantlya:acked
bytherandomnessofemergenciesanddemandsfrom
colleaguesandsuperiors.Crea1ng(andprotec1ng)one’s
closedlist(whichhealsocallsawill‐dolist)andrelega1ng
non‐essen1alstoalater1meisthecruxofDIT’sapproac
ComparedtoGTD’sscopeandmethodology,Forster’side
arestreamlinedandeasiertoimplementimmediately.Itdoesn’tmean,however,thatit’seasiertomastercompar
toanythingelse.AswithGTD,theconceptofmanagingt
closedlistrequiresdisciplineandconsistentprac1ce.
Forsterisagainstpriori1zing“tasks.”Insteadhebelievest
priori1eshavetobesetatthelevelof“projects.”Thisisa
simplebutbrilliantdis1nc1onpriori1eshavetobesetat
thelevelofcommitmentsonechoosestoaccept,i.e.,wh
project/sdoIneedtodofirstthatwillbringmecloserto
bo:omlineresultsIrequire.
WhetheryouuseGTDorDIT(oracombina1onofbothapproaches),strategicinsightisaprimarydeterminant
ofsuccess.Bothareexcellenttoolstoimproveefficiency
andleverageyour1meandenergy.However,withoutthe
controllinginsightthatconnectsyourownuniquestrengt
withthemarketplaceenvironment,1memanagement
“technology”caneasilybecomeasourceofaddi1onal
distrac1ontothemaingoalofprospec1ngandclosingth
sale.
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“ Atare Agbamu is one of only a handful of people in the reverse mortgage arena
who possesses a commanding understanding of the reverse mortgage industry.
As an originator, he has hands-on experience educating seniors and their advisors.
As author of the “Forward on Reverse” column in The Mortgage Press since 2002,
Atare Agbamu communicates nationally with the housing finance community,
bringing the unique insights and experience of an ardent reverse mortgage expert
into a wider business context.
“ This book combines Atare’s keen insights and know-how with extensive research to create a first
of its kind resource for the reverse mortgage industry. It offers a comprehensive overview of the indus-
try plus detailed information on marketing and originating reverse mortgages.
“Present and future reverse mortgage professionals and senior advisors will profit from
decades of experience skillfully woven into this book. If you plan to succeed in this industry, this
book is the place to start.” —Sarah F. Hulbert, President, Senior Financial Corporation and former four-term Co-Chair of NRMLA’s Board
of Directors
“When I first began reviewing the contents of this book, I became quite jealous ... Atare Agbamu
has set down an impressive amount of information ... And he delivers it in an easy-to-read, simple-
to-understand style that will make this book essential reading for all reverse mortgage
professionals.” —from the Foreword by Jim Mahoney, Co-Founder and Former Chairman, Financial Freedom Senior Funding
Corporation, and former four-term Co-Chair of NRMLA’s Board of Directors
“The stories [Chapter 15: Profiles in Satisfaction] are the best vehicle to increase understanding and acceptance of reverse mortgages among us laypeople. They are very compelling ...” —Therese Cain, Executive Director, Minneapolis/St. Paul Chapter of Little Brothers—Friends of the Elderly
“This book should be required reading for all new loan consultants originating reverse mortgages and
is recommended for experienced ones as well. This book provides excellent insight and information
on preparing ahead to provide the service our seniors deserve, to ensure a smooth loan process and
shorten the time to closing. Most of the problems caused in the processing and closing of reverse
mortgages come from inadequate preparation.” —Deanne Opstad, AVP, Senior Underwriter, Generation Mortgage Company
Think Reverse!
Table of ContentsPart I:
The new pillar of retirement security
Part II:
Marketing reverse mortgages: It’s all about education
Part III:
Originating reverse mortgages
Part IV:
Enhancing freedom: The essence of reverse mortgages
Part V:
A new frontier in mortgage lending
Only
$49.95Plus Postage
& Handling
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22 reversereview.com
Inearly2006,theNa1onal
CounselingonAging(NCOA)
metwiththeU.S.Department
ofHousingandUrban
Development(HUD)todiscuss
aconceptforanon‐profit
organiza1onthatmight
provideforamorestable,
transparent,andsustainablefundingmechanismforreverse
mortgagecounseling.Also,
therewastheneedtoaddress
theestablishmentofna1onal
opera1ngstandardsforHUD‐
approvedreversemortgage
counselingorganiza1ons
andtheircer1fiedHECM
reversemortgagehousing
counselors.HUDsawpossible
valueinthedevelopmentof
suchanorganiza1onaslong
asmembershipremained
voluntary.NCOAmetwith
MoneyManagement
Interna1onal(MMI)to
exploreitsinterestinpursuing
thedevelopmentofa
voluntarynon‐profitassocia1onofreversemortgagecounseling
organiza1ons.Alongwithseveralotheragencies,MMIwas
interestedandvolunteeredtocontribute1meandefforttohelp
launchwhichisnowtheNa1onalHousingCounselingAssocia1on
(NHCA).
ThankstotheleadershipofIvanHand,ChuckStanley,andDanielFentonofMMI,NHCAwasformedinWashingtonDCinMarch
2008asanon‐profitorganiza1onwith8otherpar1cipa1ng
reversemortgagecounselingagencies.Today,NHCAhas3
memberagencies,whichprovidemorethan70%ofthereverse
mortgagecounselingconductedna1onally.Inaddi1on,NHCAhas
morethan230membercounselingloca1onsthatemployover
300reversemortgagecounselorsacrossthecountry.Sinceits
incep1on,NHCAmembershavehelpedmorethan200,000seniors
withtheirreversemortgagecounseling,anditcon1nuestocounsel
over7,000seniorseverymonth.
ThemissionoftheNHCAistohelpreversemortgagecounselors
improvethelivesofseniors.NHCA’sobjec1veistosupportHUD‐approved50(c)(3)reversemortgagecounselingagenciesinthe
deliveryofhighqualityreversemortgagecounselingservices.This
isaccomplishedbycrea1ng,promo1ng,andenforcingopera1onal
bestprac1cestandardsforNHCAmembersthatimprove
consistencywithinthereversemortgagecounselingindustry.As
aresult,theabilityofreversemortgagecounselorstorespond
effec1velytotheever‐changingneedsandop1onsofseniorswho
areconsideringreversemortgagesisenhanced.Inaddi1on,the
administra1veburdenofthecounselorisreduced.Intheprocess,
detailedreversemortgagecounselingplandataiscapturedfor
researchandcon1nued
advocacy.Aswell,byu1liz
astandardtechnology
plaorm,NHCAisableto
garnerandensureapprop
levelsofcounselingresou
whileprovidingobjec1vity
consistency,andtranspare
inthereversemortgagecounselingprocess.
Sinceitsincep1on,NHCA
beentheunifiedvoicefor
reversemortgageindustry
thelendingandregulatory
communitybyworkingwi
industrystakeholders.NH
hasalreadyworkedeffec1
withAARP(American
Associa1onofRe1red
Persons),Na1onalReverse
MortgageLendersAssocia
(NRMLA),NCOA,andHUD
effec1velytransi1ontoth
“borrowerpay”ini1a1vef
reversemortgagecounsel
AnotherNHCAgoalistofacilitateandadvocatefinancialsuppo
forreversemortgagecounselingprograms.NHCAwillworkwit
lendersandHUDtodevelopaconsistentprocesstoensuretha
allreversemortgagecounselingagenciesarepaidforcounselin
whenpaymentissupposedtooccuratclosing.NHCAisalsowi
toadvocatewithotherstakeholders,suchasNRMLA,forFHA
fundingforreversemortgagecounselingratherthanthroughthpresent“borrowerpay”mechanism.
NHCAisanon‐profitorganiza1onthathasadiverseand
independent2‐memberBoardofDirectors.Oneboardmem
isanexpertonagingissues,anotherisanexpertonconsumer
economiceduca1on,andthereareseveralindependentexpert
providingmanagementandfinancialadvice.MichaelKeenewa
appointedpresidentinJulyalongwithamarke1ngprofessiona
thetworepresentthecoreoftheNHCAmanagementteam.
TheQualityImprovementAdvisoryCommi:eeiscomposedof
agencyrepresenta1veswhomakerecommenda1onstotheBoa
oncounselingprotocol,membershipstandards,andontheCodEthics.ChangeswillbereviewedbytheIndustryAdvisoryCoun
andapprovedbyNHCA’sBoardofDirectors.AllNHCAmember
agreetoprovidedataviaNHCA’sstandardplaorm,whichinclu
appropriatesafeguardssothatconfiden1alityofcompe11ve
agencyinforma1onisnotcompromised.Thisdatawillbeused
conducttheresearchinordertoimprovethequalityofreverse
mortgagecounselingalongwithinputfrommemberagenciesa
otherindustrystakeholders,suchasNCOA.Withtheassistance
NHCABoardmemberDr.AngelaLyons,thisdatawillalsobeus
toprovethevalueofreversemortgagecounseling.NHCAresea
MichaelKeene
President
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willdemonstratethevalueandguidetheevolu1onofreverse
mortgagecounselingforthefuture.
TheIndustryAdvisoryCouncil(IAC)iscomprisedoflendersand
industryexpertsrepresen1ngacrosssec1onofthereverse
mortgageindustry.Themembersprovideinputandadviceon
behalfofthelendingcommunitytothemanagementteam
regardingbestprac1ces,marketresearch,analysisofthereverse
mortgageindustry,andgeneralcounselingissues.TheIACelectsoneex‐officiomembertotheNHCABoardofDirectors.
AstandardNHCAmembershipis$00monthly(thereisno
applica1oncharge).Thiscostpermonthincludesmemberswith
mul1pleservicebranchoffices.Astandardmembershipincludesall
ofthefollowing
Receiveallgeneralreversemortgagecounselinginforma1on,•
updates,no1ces,HUDMortgageeLe:ers,no1cefromHUDfor
publiccomment,andlawupdatesandchanges
ReceivecurrentnewsonHUD,industryandpressreleases•
ReceiveNHCAonlinenewsle:er•
Receiveresearchandaggregatedataandrepor1ng•
Par1cipateinindustrymee1ngsandconferences•
Par1cipateinthedevelopmentofindustrybestprac1ces•
Receivereferralsthroughthelis1ngandmapsontheNHCA•
Website
AccesstoNHCA’scounselingmanagementsystem,which•
providesstandardizedcounselingprotocol,billingand
collec1ngofthecounselingfee,repor1ng,trackingclient
progressforlendersandcounselingagencies,andHUD,CMS,
andCARScompliance
Accesstothemembersec1onoftheNHCAWebsite•
PlacementoftheNHCAlogoonthememberWebsite•
Receiverepresenta1ontolenders,NRMLA,HUD,AARP,NCOA,•
regulators,andthemediaReceivequalityimprovementandresearch•
DirectConnectisNHCA’sexclusivetechnologypartner,andNHCA
memberagencieshaveexclusiveuseofthesystem.DirectConnect
providesupdates,enhancements,andongoingtrainingtolenders
andcounselingagenciesonhowtousethesystem.
NHCAmembershipisopentoallHUD‐approved50(c)(3)reverse
mortgagecounselingagencieswithappropriateinsuranceand
fidelitybonding.Inaddi1on,allNHCAmemberagencieswillbe
requiredtoadoptandfollowbothNHCAmembershipstandards
andtheCodeofEthicsaspartoftheirNHCAmembership.NHCA
membersensurethatreversemortgagecounselorswillprovidecounselingservicestoseniorswithin72hours.
Today,HUD‐approvedreversemortgagelendersandtheirloan
officersfacemanychallengesinmee1ngthereversemortgage
counselingneedsfortheborrowerstheyserve.NHCA’sreliable
technologyplaormprovidesarobustbilling,tracking,and
collec1onsystemforthepaymentofcounselingfeesunderthe
new“borrowerpay”regula1onfromHUD.NHCA’sinterac1ve
paymentsolu1onsystemoffersborrowerstheop1ontopayby
creditcardorACHup‐front,ortofinancetheircounselingfeeinto
theirloan.NHCAmemberagencieschoosewhethertogivesen
theop1ontopayup‐frontoratclosing.Agenciesthatchooset
seekpaymentup‐frontdosoaslongastheseniorinvolvedcan
affordtopay.Iftheseniorcannotaffordtopayorhasahardshi
paymentcanbemadeatclosing,oritcanbewaived.NHCAha
comprehensivesetofcounselingchoicestomaketheprocesso
reques1ngcounselingasconvenientaspossible.AsHUDrequir
thatseniorsmaketheini1alcontactwithacounselingagency,
NHCAhasmadethefollowingop1onsavailableInternetregistra1onandselec1onofthereversemortgage•
counselingagencydirectlybythesenior
Faxregistra1onanddirectselec1onofthereversemortgag•
counselingagencybythesenior
Callingareversemortgagecounselingagencydirectlyfrom•
counselinglistthatcanbeobtainedthroughthehomeown
sec1onoftheNHCAWebsite(www.LearnReverse.org).
Althoughlenders’useofDirectConnectso`wareisnotrequired
workwithNHCA,itisstronglyrecommendedthatlenderscon1
toregistertheirclientsinDirectConnecttosimplifythecounsel
processfortheirborrowers.Lendersubscribersaccessing
DirectConnect’sWebsitecan
Generateacustomizedcounselinginforma1onpacktailore•
theneedsoftheirindividualclient
Ensurethatcompleteandaccuratelenderinforma1onis•
providedtothecounselingagency(reducingadministra1ve
problemsandclientconfusion)
Con1nuetousethepowerfultrackingandrepor1ngtools•
AtNHCA,wetakeprideinourmemberagenciesandtheborrow
theyserve.Inaddi1ontoadheringtoourmemberstandards
andCodeofEthics,memberagenciesagreetopar1cipateinou
disputeresolu1onprocesswherebyanylenderorseniorcanfil
complainteitheraboutanagencyorareversemortgagecounseThiscanbeaccomplishedontheappropriatepageoftheNHCA
Websiteorthecomplaintcanbesubmi:eddirectlytoMichael
KeeneatNHCA.Allcomplaintswillbethoroughlyinves1gated.
Feedbackwillbeprovidedtothecounselingagency,andall
complaintswillbetrackedandrecordedbyNHCA.
NHCApledgestohelpandsupportthedeliveryofhighquality
reversemortgagecounselingtoseniors,toensurethedelivery
ofconsistent,reliablecounselingservices,andtodevelopa
sustainablesourceofrevenueforcounselingagenciestooffset
costofprovidingthismuch‐neededservice.NHCAwillaccomp
thisbyworkingwithHUD,lenders,NRMLA,andagingadvocate
helpimprovethemarketforreversemortgagecounseling.
WehopeeveryonewillbeablejoinusatourNHCAAnnual
ConferenceonMarch24,2009inWashington,DC.More
informa1onwillfollowsoon,anditwillbeavailableonourWeb
site,www.LearnReverse.org.
Advertorial by National Housing Counseling Associa
About Michael Keene : Michael was appointed President of the National
Housing Counseling Association in July, 2008. He was the Vice Presiden
of New Program Development at Money Management International for t
previous 5 years. He was responsible for the design, testing, departmen
coordination, rollout, and evaluation of new program offerings. Michael.
[email protected] 510.287.6085
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A s we look at 2008, most of the Reverse Mortgage industry will agree, this year was
a much more challenging year than we anticipated. Even as the economic downtusolidified its foothold, many of us saw it as greater opportunity to communicate thbenefits of the program.
For those who survived, 2008 provides a wealth of information and lessons to draw upon this industry continues to mature and grow. A simple lesson I learned from a coach whenwas a young man, “It’s easy to stand tall when everything is going your way, but the tru
measure of man is how he reacts when tested by difficult challenges.”
Lessons
from 2008 LearnedBrett Varner
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Withthatinmind,thefollowingarethoughtsonsomeof
thelessonslearnedin2008andwhattheymeantousasan
industry.
RMisNOTRecessionProof–Althoughfewpeoplecould
havebeenpreparedforthedepthandbreadthofthe
loomingrecession,thisindustrysawopportunityon
thehorizon.Asreturnsandvaluesofre1rementassets
decreased,ReverseMortgagewasprimedtobeseen
byseniorsasasafehaven.Whatothervehicleinthis
environmentwouldprovidethemasecurityblanketto
weatherthestormandmaintainorimprovetheirquality
oflife?Mostoriginatorsoverlookedthedebilita1ngfear
createdbyanuncertainmarket.Seniorswhocouldtruly
benefitfromthisproductchosetheperceivedsafetyofdoing
nothing,evenincasesofmortgagelatesand/ortaxdefaults.
Asthenightlynewsportrayedeconomicdoomandgloom,
manyolderAmericansseemedtoshutdownandchoose
theheadinthesandapproach–byignoringtheirfinancial
difficul1es,theydidn’texist.RMSpecialistscoulddoli:le
morethanaskwithexaspera1on,“Ifyoudonothing,will
thingsgetbe:er?”
DirectMail,JustSendMore?–Earlyin2008,companies
sendingdirectmailsawasurprisinglylargedropinresponse
rates.Atfirst,wetriedtoexplainitawaywiththevolumeofpoli1calmailduringaconten1ouselec1onyear.Marketers’
responsewastoincreasevolume.Aslongasconversion
ratesstayedsteady,theonlydrawbackwasanincrease
inthetransac1onalmarke1ngcost.Ofcourse,marke1ng
expertshadnotyetrealizedtherealityofthemarketplace
anditsimpactonconversionrates.Costsincreased,revenue
decreased–somecompaniessurvived,somedidn’t.
Theques1onthatkeptcomingtomymindis,“Whoarewe
talkingto?”Inmanyofthemailpieces,themessagewas,for
themostpart,thesame,“Government‐Insured,NoMonthly
Payments,Tax‐FreeIncome,NoCredit/IncomeQualifying.”Whatsolu1ondoesthisprogramdescrip1onprovide?
This“shotgun”approach,blanke1ngareaofhomeowners
62andover,providedareasonableresponseforsome1me
asitpiquedtheinterestofasufficientnumberofseniors.
However,asthechallengesfacedbyseniorshavebecome
morecomplex,thisapproachfailstocommunicatedirectly
withtherecipients.
Messagingdirecttotheneedsofadiverseclientelerequi
amore“laser”approachthat
requiresfurtherdefiningthemarketintosub‐segmentsusingmore
specificmetrics.Abe:erdefined
targetallowsacompanytocra`a
messagethatspeakstotheneeds
ofthatspecificgroup.Although
thisapproachshouldleadtoa
be:erqualified,moreinterested
lead,itcanbeariskyapproach
ifthemessagefailstoreachthe
demographic.Thetruthismany
directmailcompaniesdonotyet
understandtheseniorpopula1on.
PeopleareMoreImportantthan
Product–Themostcommon
mistakeinReverseMortgagesalesis
thatitisabouttheproduct.Many
salespeoplebelievethatiftheycan
explaintheproduct,itwillsellitself.
Wehaveallheardthecomment
fromconsumers,“Itjustsoundstoo
goodtobetrue.”Conven1onalRM
wisdomsays,“Withaproductlikethis,aproficiencyinexplaininghow
itworksshouldbeenough.”Itisn’t.
Icallthisthe“OrderTaker”vs.the
“TrustedAdvisor”.Simplyput,the
OrderTakerregurgitateseverything
abouttheproductandthenwaits
fortheconsumertocometothe
checkoutline.TheTrustedAdvisor
seekstotrulyunderstandwhatthe
clientisfacingandstrivestoprovide
meaningfulsolu1onsbasedupontheclient’sneeds.Theadvisorisableto
detailwhattheclientshoulddoto
improvetheirsitua1onandguides
themthroughtheprocess.
Fromamanagementperspec1ve,thereisnobiggerdrain
onacompany’sresourcesthantheOrderTaker.The
OrderTakerisgenerallyascriptreader,spewingproduct
informa1onandisunabletoadeptlyveeroffscriptto
“The overriding lesson of 2008 is simple, this industrlives and provide respect, dignity and security to old
the Amer
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Dec 08 / Jan 09
respondtoaclient’slackofunderstandingorfearbased
objec1ons.TheOrderTakereither
lackscapability,orjustplainfails,todevelopsufficientrela1onshipwith
theirprospectstobeabletoaddress
issuesinastraighorwardmanner
thathelpsaclientovercomethe
o`enmisguidedobjec1ons.
TheTrustedAdvisor,conversely,
maximizesresultsbylisteningto
hisclients,spendingmore1me
askingques1ons,listeningtothe
concernsoftheprospect.Fostering
abe:erunderstandingofthe
individualclientallowsthemto
cra`informa1onbaseduponthe
specificneeds.Ul1mately,they
consistentlyrelatetheprogram’s
benefit,notinfinancialterms,but
inmoreimportantpersonal,quality
oflifeenhancingaspects.Although
thissalestypegenerallyhashigh
conversionrates,theinherent
danger,ifpoorlymanaged,istoo
muchfocusonrela1onshipthatlengthensthesalescycleandlimits
thenumberofclientstheycanassist.
Thestrugglesof2008hashelpedto
filteroutordertakersandgenerate
moreopportunityforadvisors.
Thechallengefor2009istofocus
onhelpingtheTrustedAdvisors
maximizetheirproduc1oncapacity.
TheRealityofCompe11on–A`er
mul1pleyearsofsignificantgrowth,
theReverseMortgagesector
garneredincreaseda:en1onas
thesubprime“meltdown”le`many
“other”en11eslookingforthenext“easy”buck.This
productseemedripeforthepicking.Clearly,itcouldn’tget
anyeasiernocreditscoreorincomequalifying,just“age&
equity.”Thishadtobethenext“refi”boom.
Yes,theinfluxof“compe1tors”hassiphonedoffashare
ofexis1ngbusinessfromestablished,dedicatedReverse
Mortgagecompanies.However,thevastmajorityofnewentrantshavefailedtoproducemorethanafewloanspe
month.Manyhavevanishedasquicklyastheyappeared
Whyisthis?Simply,theirbusinessmodelswereunprepa
fortheslowersalescycleoftheReverseMortgagemarke
Highini1alexpenditures,combinedwithslowerdevelopin
revenueshavebeenunsustainableformanycompanies.
Others,inresponsetofailinginterestrates,havegleefully
returnedtotheir“turnandburn”forwardmodels.
Currenttrendssuggestthatthesiphoningeffectwillbe
short‐lived.Inthelongrun,established,dedicatedrevers
Mortgagecompanieswillcon1nuetodominatemarket
share.Although,asinanymaturingmarket,thenumber
qualitycompaniescontrollingthemarketwillincrease(no
withstandingsomeexpectedconsolida1on),companies
lookingtoReverseMortgageasastopgapmeasure,quick
product,oradd‐onfeaturewillfailtogainsignificantfoo1
inthisspace.
ForthosecompaniesdedicatedtotheReverseMortgage
space,weneedeachother.Weallhaveavestedinterest
infosteringaposi1veimageofthecommitmenttoand
concernfortheclienteleweserve.Withacommitmenttunderstandingourdemographicandafocusonservice,i
willbetheclientsthatchoosethecompanythatbestsuit
theirneedsanddedicatedcompanieswillgetbe:erat
iden1fyingtheir“ideal”prospect.
Theoverridinglessonof2008issimple,thisindustry
representsaproductthattrulyhasthecapabilitytochan
livesandproviderespect,dignityandsecuritytoolder
Americanswhorepresentsomuchofwhatisimportantt
theAmericanWayofLife.Weareintheuniqueposi1on
buildcareerswhilegivingsomethingbackforthelivesan
sacrificestheyhavemadefortheirfamilies,communi1es
andcountry.
Wehaveadutyandresponsibilitytolearnfromour
experiences,con1nuetoimprovethisindustryandhelp
protectitsintegrity.Wesetthestandardthatpar1cipant
neworold,mustcon1nuallyaspireto.
esents a product that truly has the capability to changmericans who represent so much of what is important tWay of Life.”
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IfyouareaReverseMortgageexpertandplanonbuilding
yourmortgagebusinesswithReverseMortgages,READON!!
Now,ifyouplantodabbleanddoafewReverseMortgages
hereandthere,youmaywanttostopreadingandturnthe
pagetothenextar1cle.
ReverseMortgageisoneofthefew–ifONLY–growing
productsinthemortgageworld.It’sagreatplaceto
be,however,itisafardifferentworldthantheforward
mortgage.
Onceyouhavemadethedecisiontofocusyourbusiness
onReverseMortgage,thebestthingyoucandoisposi1on
yourselfastheexpertinthisfieldinyourcommunity.Some
helpful1pswouldbetoaguestonalocalradioshowthat
caterstotheseniorcrowd.Youmayevenbeabletobeon
weeklyandprovidehelpfulinforma1ontothelisteners,as
wellasmarketyourselfandyourservices.Anothergreat
ideaistocontactlocalchurchesorseniorcenters.Partner
withyourlocalestatea:orney(s)andjoinanetworkgroup.Thiswillgiveyougreatvisibilityintheprofessional
community.
Asyoubegintoalignyourselfinyourcommunity,youwill
begintoreapthebenefitsofthehardwork.Youwillsoon
learn‐ifyouhavenotalready‐seniorsareveryloyalandwill
beagreatsourceofadver1sementforyourbusiness.Ifyou
providethebestservicetooneseniorcouple,theyaresure
toshareitwiththeirfriendsandthosefriendswillbeasking
foryournameandnumber!
YoumustalsokeepyourselfeducatedontheReverseMortgageproduct.Thereareimprovedprogramsand
updatedlawsandyouneedtostayontopofthesechanges.
Thiswillallowyoutoprovidetop‐notchservicetoyour
seniorclients.Joininganorganiza1onsuchasREMALO
(ReverseMortgageAssocia1onforLoanOfficers)willprovide
yousomeexcellenttoolstokeepyouontopofthelatest
news,marke1ng1ps&othergreatresourcesinReverse
Mortgageindustry.AnothergreatresourceisSandraWiley’s
ReverseMortgageblog(sandrawileyonreversemortgages.
blogspot.com).Sandraisthena1onaltrainerforAlliedHo
MortgageCapitalCorpora1on.
UsingDirectMailtoGenerateRevenue
Ifyouhaveneveruseddirectmailaspartofyourmarke1
programinthepast,Iencourageyoutoreadon.O`en1
peopledon’tu1lizethisvaluableresourceavailabletothe
becausetheydon’tfullyknowthebenefitstheycanreap
Mygoalinthispor1onistoeducateyouondirectmailan
showyouthevalueitcanbringtoyourbusiness.
Origina1ngloansthroughdirect‐mailleadgenera1onis
themosteffec1veandprofitablemeanstoincreaseyour
monthlyfundingvolume.Youasamortgagebrokershou
maximizeyoursalesproduc1vitybyinves1ngmostofyou
1meinpre‐qualifiedleads.Prospec1ngisalow‐wagejob
sellingisahigh‐paidjob!Whywouldyouusehighlypaid
salespeopletodolow‐wagework?
Direct‐mailmarke1ngcanbeveryeffec1vebutit’snotas
easyasyoumaythink.Why?Becausedirect‐maildoesn’
workaswellasitusedto.Partoftheproblemisthere
issomuchofitsatura1ngpeople’smailboxestodayand
becauseofthat–peoplehavelearnedtoignoreit.The
biggestproblemwithanyadver1singmediumtodayistha
itfightsforpeople’sa:en1onbyinterrup1ngthem;but
thereisfartoomuchgoingoninpeople’slivesforthemt
beinterrupted.Americaisanover‐communicatedsociety
andthereinliestheproblem.Eventhoughmorebusiness
areusingdirect‐mail,itisactuallylesseffec1ve.Direct‐misavic1mofitsownsuccess.Butwhendirect‐mailworks
–it’sunbeatable!Whenyoufindtherightformulaforyo
specificneeds,itcanbemagic.
Letthemagicofhigh‐impactdirect‐mailworkforyouby
genera1ngacon1nuousflowofcostefficientleadswhich
canradicallymaximizeyourmonthlyfundingvolume.The
followingaresomestrategiesandconceptsyoushould
employtomakeyourdirect‐mailmarke1ngsuccessful.
The Reverse Mortgage Marketing Plan
Tom Emmerson
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U6lizeProfessionalSupport
Directmaillookseasyenough.Youprintoutyourle:er
alongwithmailingindiciaonyourenvelope;getyourtrays
&tagsandyou’rereadytogo,right?WRONG!Direct‐mail
shouldNEVERbeado‐it‐yourselfac1vity!Withoutthe
professionalservicesofadirect‐mailcompany,yourunthe
riskoflosingvaluable1meandmoneybytryingtotackletheprojectyourself.Today,efficient,accurateanddeliverable
direct‐mailrequiresup‐to‐the‐minuteknowledgeofmailing
costs,listhygiene,properformats,automa1ondiscounts,
carrierroutes,barcodes…thelistgoesonandon.
Direct‐mailisasciencethatprofessionalmailcompanies
workwitheveryday.Youshouldnotassumethatyoucando
whattheydowithequalexper1se.Theydothemostgood
forthoseclientswhoputtheirtrustinthemandwhoturnto
themasdirect‐mailexperts.
Whydivertyourselffromwhatyoudobestinyourbusinesstohandlethecountlessdetailsinvolvedingengyourmail
campaigntothepostofficewhensupportisonlyaphone
callaway?
ThereareseveralcostsassociatedwithDirectmail,butm
surenottofocusonlyonwhatyouhavetospend;alsolo
atthepoten1aldollarsyoucanearnonyourinvestment.
Acarefullyplannedandexecuteddirectmailprogramcan
meanasignificantresponsefrompoten1alcustomers.Th
increasedresponsewilltranslateintosalesandprofits.So
insteadofasking“howmuchwillthismailingcost?”The
primaryconsidera1onreallyoughttobetheresults.
Lookatthelevelofsophis1ca1onofthemailthatcomes
yourhome–andoffice–onadailybasis.High‐qualitym
getsyoura:en1on,anda:rac1nga:en1onmeansgen
yourmessageacross.Youdon’thavetoadopta“sky’sth
limit”atude.However,ifyouarewillingtospendjusta
li:lemoreonabe:erdesignandcopy,yourabilitya:rac
moreprospectsarelikelytoimprove.Ifyouarewillingto
investinaslightlybe:ermailinglist,youmayreachsome
keyprospectsyoumightotherwisehavemissed.
Soremember,don’tfocusonthecostofthemailing.Instead,lookatthecostinrela1ontotheincreasedresult
youcanachievebyinves1ngali:lemore.
THERE'S A BETTER WAY
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ConsistentMailingProvidesConsistentResponse
Everno1cehowfewresponsesyougetonaweeklybasis
whenyoudon’tmailanything?Sillyques1on,Iknow.Buta
companythatdoesmailcangenerateincredibleresponse.
Manycompanies,however,donotseethiscauseandeffect
rela1onship.SohereistheresultIfyoumaileveryday,youarelikelytoreceiveresponseseveryday.Likewise,
ifyoumaileveryweekormonth–youaremorelikelyto
getresponsesweekly/monthly.It’sacycleyoucreate&
control!
Watchoutfortheinevitablepiall–gengsidetracked!For
example,whenbusinessisbooming,thereisthetempta1on
tostopmailing.Youaresowrappedupinfollowingupand
closingthedealsthatdirect‐
mailcanfallbythewayside.So,
whathappenswhenyouhave
completedyourfollowupanddealclosings?Ifyouhaven’t
triedtogeneratenewleads,
nonewillbecomingin,andno
newleadsequalsnonewsales.
Throughaconsistentmailing
program,eachleadarrivesas
needed,andwillhelpminimize
thepeaksandvalleysinyour
salesac1vi1es.Consistency,
whetherthatmeansmailingweeklyormonthlyforyou,along
withthesalesthatgowithit,workstowardsdevelopingand
maintainingaconsistentmailingschedule.Addi1onalyusing
aprofessionaldirect‐mailcompanycanmakethishappenfor
youalmosteffortlessly.Theycancoordinateyourmailings
basedonyourrequirements.Theywillmakeithappenwith
li:leofyour1meoreffortneededtodoso.
ElementsofDirect‐MailSuccess
Therearethreemainelementsinvolvedindirect‐mail
success.Mailingdatalists,theoutsidepackage(envelope)andtheinsidecrea1ve.Eachoftheseplayanimportant
role,butthelistis60%‐70%ofthesuccessofanymailing
campaign.
Whenmailing–remembertotargetprospects–not
suspects!ImportantselectsforaReverseMortgagelistare
easytorememberage(62andup),homeowner,homevalue
&creditworthiness.Ithasbeenfoundthroughtes1ngthat
thoseprospectswithafewcreditderogatoriesarethose
withthegreatestneedforaReverseMortgage.
Nextistheenvelope,choosingtherightpackagetodelive
yourmessageiscri1cal.Youhaveapproximately3second
tomakeitintothe“keep”pile.Americanssorttheirmail
overthetrashcan!Makesureyouchooseapackagethat
doesn’tgetsenttothegarbageheap!Somehelpfulhints
tomakeitintothekeeperpilearetousedifferentcolorenvelopes–somethingthatwillstandoutagainsttherest
ofthebillsandmailers.Second,usehard‐hingcopywh
makingitshortandsweetandmakingitbeneficialtothe
seniorconsumer.Remember,thisisaboutthem–notyo
Onceyouwintheba:leandyourenvelopeisopened–h
agreatmailerinsideforthemtoread!Whendeveloping
yourle:ercopy–remember,therearethreewordsthat
aremostimportantindirect‐
mailcopy.ThefirstisYOU.
Thisallowsyouanopportuni
toappearcloseandin1matewithyourreader.Youmight
besurprisedhowmanymore
1meswordslikewe,us,orou
appearincopy,ratherthany
Byusingthesewords,yoush
a:en1onawayfromtheread
needstoyoursasaseller.
However,byusingthewordy
themessageisgeareddirectl
towardyourprospect,andyo
reassurethemthattheyaretimportantprospectyouhave
andthatyouunderstandtheirneeds,wants,anddesires.
Thesecondmoreimportantwordu1lizedindirect‐mail
isFREE.Freeimpliesthegreatestpossiblevalue,over
andabovethepriceofthemerchandise.Freeimpliesan
opennessthatnootherwordconveys.Morethananyot
word,freeinvitesyourprospecttolookatyourproduct,
serviceorofferwithoutmakingacommitment.Freeisa
opportunityforyoutoreachaprospectwho,byrespond
toyourfreeoffer,islabelinghimselfasinterestedinyoua
yourproductorservice.
Whatdoesfreecostyou?Itmightcostnothing,because
every1meyougivesomethingawayfree,yougetsometh
inreturn–anopportunitytopresentyourstory,andthat
movesyouclosertowardyourgoal–tosell.
“Whatdoesfreecostyou?Itmightcostnothing,becauseevery2me
yougivesomethingawayfree,
yougetsomethinginreturn–an
opportunitytopresentyourstory,
andthatmovesyouclosertoward
yourgoal–tosell.”
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32 reversereview.com
Thethirdmostimportantwordindirect‐mailisNEW.Ina
societylikeoursthatisenviousofanythingandeverything
new,isn’titstrangethatwerarelyseeanewwayof
expressingthatwhichisnew?Youcannotfindawordin
theEnglishlanguagethatismorestraighorwardorconcise
toconveytheessenceofnew.Whenyouadver1seanew
productorservice,youareofferingyourcustomerthe
chancetobethefirstathavingit,oryouprovidethemwiththeopportunitytodosomethingdifferentandexci1ng.
Peoplesimplylikethefeelingofnew.
Thesethreewordswillneverlosetheireffec1veness.Be
suretokeeptheseinmindwhendevelopingyourdirect‐mail
copy.
Direct‐MailPackages
Nowthatyouknowtheimportanceofdirect‐mail,howit
worksandimportanthintstodevelopingyourownpackage
–letmeshareafewpackageop1onsyoushouldlookinto
foryournextcampaignthatyieldthebestresultsamongthe
seniorpopula1on.
Thefirstop1onistheLeadGenera1onPackage.Thisis
themostbasicofthepieces.Thispackageconsistsofthe
le:erandacalltoac1onbytheprospecttoeithercallyou
formoreinforma1onorsetupanappointment.Another
possibleop1oninthistypeofmaileristoinsertabusiness
returncardfortheprospecttocompleteandmailbackto
youformoreinforma1on.Whilethismailingpackageis
effec1ve,itdoesyieldlowerresponsesthantheothertwoI
willsharewithyou.Youcanexpecttoaveragea.5%‐.5%responserateonthispackage.
Thesecondop1onisthetearoffsheet.Thesepackages
areeyecatchingfromtheenvelope!Thereare5vantage
pointswhendoingatearsheetmailing.First–theseare
plainwhiteenvelopeswithnoreturnaddress.Recipients
aren’tcomfortablethrowingoutapieceofmailwithout
knowingwhosentit,andthecuriositydrawstheminside
yourenvelope–overcomingthebigobstacle!Second–the
recipient’snameandaddresswillbehandwri:enonthe
envelopes.Thereisnouseoflabelsorbarcodesonyour
mailer.Third–alivefirst‐classstampisplacedonthemailer.Savvyrecipientsknowthatbulkorpresortedstampssignal
unwantedsolicita1ons.Fourth–yourtearsheetinsidethe
envelopeisacustomeradver1sementforyouandyour
product.Itwilllookasthoughitweretornfromthepages
ofapopularmagazineornewspaper.Totherecipient,itwill
appearasifsomeonehasgonetothetroubleofpersonally
tearingoutyouradandsendingittohimorher.Your
messageMUSTbeimportantifsomeonehasgonetoall
thattrouble.Thetearsheetallowsyoutoconveyasmuch
informa1onaboutyourproductorserviceasyouwish.T
fi`handfinalvantagepoint–ahandwri:enpersonalized
noteplacedonayellows1ckynoteanda:achedtoyour
Thisisyourcalltoac1on!Agreat1pasignatureorini1
includedonyournotecanbeagreatwaytokeepyourad
yourprospect’shand.Theywillreadyouradandponder
wonderwhosentthistome?”
Seminarpackagesarethelastop1onformailers.Thesea
idealtouseintheseniorcommunityasthishelpsyoubu
trustwithyourprospects.Importantpointersofasemin
aretoprovideamealinacomfortablediningatmosphere
whileeduca1ngseniorsonReverseMortgageandschedu
anappointmentforfollowup.Thisisoneofthebestdire
mailtoolstouse.
Inyourdirect‐mailcampaign,seniorsandtheirfriendsare
invitedtoa:endafreedinneratalocalrestaurant.Once
there,giveashorttalkabouthowReverseMortgageswo
andallowforaques1onandanswersession.A`erward,theyenjoyacomplimentarydinnerwiththeirfriends,wh
youhaveachancetomeetandtalkwithpoten1alclients
setuplaterappointments.Thistypeofpackageallowsyo
tobuildcredibilityinyourcommunityandgenerateleads
youweretomailaseminarpackageonceamonth,youc
expecttogenerate00newprospectsinthatmonth.Do
overa2monthperiod–thatis,200prospectsinsemin
leadsinperyear!
BuildingYourDataBase
A`erbuildingyourdatabase,youshouldputinplaceamonthlydripcampaign.Adripcampaignconsistsofmail
yourprospectsandclientsonamonthlybasis.Havingad
campaigninplaceshowsyouarestableandtrustworthy;
prospectyoumailtoinJanuarymaynothaveanyinterest
inaReverseMortgage,butmaybeinJuneorJuly,thatsam
prospectwillfindthemselvesinneedandifyouaremaili
monthly‐yourmailerwillhitatjusttheright1meandm
theneedofthissenior.
Ihopeyouwillputthisinforma1ontouseandu1lizethes
techniquesinyournextdirect‐mailcampaign.Ifyouare
lookingtodirect‐mailforthefirst1me,orhavebeentryintotacklecampaignsonyourown–givemeacalltoday.
Mygoalistomakeyourcampaignasprofitableforyouas
possible.Icanprovideyouthepiecesandthetoolstoma
thathappen.Iwillbehappytoshowyousamples,provid
youcountsandshowyoujusthoweasyitistoexecutea
ReverseMortgagecampaignquicklyandeasilybyusinga
professionalmailcompany.Bestoflucktoyouinthecom
NewYear!
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Asconsumersofinforma1on,weareallaccustomedtoseeing
year‐endreviewsonawholerangeofsubjectseachDecember.
Asthistumultuousyearwithinthefinancialsectordrawsto
aclose,itisnodifferent.Eventhoughthereversemortgage
industryhasweatheredthestormquitewell,therehave
nonethelessbeenmanysignificantchanges,asbesthighlighted
inouryear‐endreviewof2008MortgageeLe:ersissuedby
FederalHousingAdministra1on(FHA)concerningitsHome
EquityConversionMortgage(orHECM)program.
HECMsaretheFHA‐insuredreversemortgageloanprogram.
HECMloansareauthorizedbySec1on255oftheNa1onal
HousingAct(orNHA),andareprimarilygovernedbytherules
andregula1onsoftheFHA,including,innosmallmeasure,
MortgageeLe:ers.Asthisar1clewenttopress,FHAhadissued
9le:ersincalendaryear2008concerningitsHECMprogram,a
recordnumberreflec1ngtherecordpaceofchangewithinour
industry.
ML2008–08
Star1ngwithabanginMarch2008,FHApublishedML
2008‐08,whichclarifiedtheabilityofFHA‐approved
mortgageestoofferfixedinterestrateHECMloanstoseniorapplicants.WhileFHA‐approvedmortgagees
havealwaysbeenpermi:edtooriginatefixed
interestrateHECMloans,lackofclarity
concerningalender’sabilitytostructure
aHECMloanthatmi1gatedinterest
raterisk(ortheriskofa
mismatchbetweenthe
lender’scostoffunds
andthefixednote
ratefor
advancesoccurringinthefuture)resultedinveryfewofthes
loanshavingbeenoriginated.
ML2008‐08,whileprovidinglong‐awaitedguidanceforlend
toencouragetheofferingoffixed‐rateHECMs,hasbeenam
blessing,providingsomeclarifica1onbutfailingtoaddressa
numberofcri1calissues.Importantly,ML2008‐08clarifiedt
fixedrateHECMsmaybestructuredasopen‐endorclosed‐e
creditandauthorizedlendersorigina1ngfixedrateHECMsto
makethenecessaryandappropriatemodifica1onstotheloa
documentstoconformtoML2008‐08andensurecomplianc
withFHA’srequirementsandapplicablelaws.PerML2008‐0
lendersmustalsoensuretheirfixedrateHECMloandocume
(i.e.,theHECMfirstandsecondnotesandtheHECMLoan
Agreement)clearlyindicatewhethertheloanisstructureda
openofclosed‐endcredit.
PursuanttoML2008‐08,lendersmustbeabletoofferallof
thestandardHECMpaymentplans(i.e.,theterm,
tenure,lineofcredit,andmodifiedtermor
tenureplans)toseniorborrowersobtain
afixedrateHECM.Unfortunately,FHA
didnotexpresslyprovidethatlender
maychargedifferentfixedinterestrabasedupontheborrower’schoiceo
paymentplan.Inaddi1on,senio
borrowersmustbeabletochan
paymentplanop1onsduringth
termofthefixedrateHECM,
aslongastheborrower’snet
principall
rema
YEAR FOR THE RECORD BOOKSA Year-End Review of
2008 FHA Mortgagee Letters Weiner Brodsky Sidman Kider
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available.ThemonthlyservicingfeeonafixedrateHECMmay
notexceed$30andthechargeforapaymentplanchangeis
limitedto$20.
Finally,ML2008‐08mandatedthattheexpectedaverage
mortgageinterestrateusedtocalculatetheseniorapplicant’s
PrincipalLimitmustbethesameastheHECMnoterateof
interest.Theexpectedaverageinterestrateandthenoterate
mustbesetsimultaneously.Note,also,thatalthoughFHA‐approvedmortgageesarepermi:edtolockthemortgage
interestrateonfixedrateHECMtransac1ons,FHArulesand
guidanceinothermortgageele:ersprohibitlendersfrom
chargingafeeforlockingtheinterestrate.
DespitetheguidanceprovidedinML2008‐08,thereremaina
numberofchallengesforlendersofferingfixed‐rateHECMs.
Someoftheissuesincludethetreatmentunderafixedrate
HECMofunusedfundsremainingfromarepairsetasidesetup
atclosingandthetreatmentoffundsthatmaybecomeavailable
totheborrowera`ertheclosingofafixedrateHECMduetothe
growthinthenetprincipallimit.Lendersoffering,orinterestedinoffering,fixed‐rateHECMsshouldconsultwiththeirlegal
counseltoevaluatetheseissues.
ML2008‐12
ML2008‐2isanother,inalonglineofmortgageele:ers,that
addresscounseling.Aseniora:endingacounseling
sessionwithaHUD‐approvedcounselorisapre‐requisiteto
thefinalapplica1onforaHECMloan.Thus,counselorsserve
“gatekeeper”func1onforthereversemortgageindustry,and
mandatoryHECMcounselingmustoccurpriortothe“point
sale”ofaHECMloan.
Amongotherthings,ML2008‐2implementedrulespublish
byHUDinSeptemberof2007asarevisionofHUD’sbroader
rulesoncounseling.Theruleprovidedthatcounselingagenmaychargeafeetoaprospec1veborroweraslongasthefe
isreasonableandcustomary,anddoesnotcreateafinancial
hardshipfortheborrower.ML2008‐2makesclearthat
counselingagenciesmustinformborrowersofthefeestruct
priortocounseling,andthataborrowercannotbeturnedaw
duetotheborrower’sinabilitytopayforcounseling.HUD
determinedthatareasonablefeeforcounselingcannotexce
$25,butthatthefeemustbenotbeexcessiveandmustbe
commensuratewiththeservicesactuallyperformed.Payme
forcounselingmustbedisclosedinthe800seriesontheHU
ML2008‐24
Inthefirstmortgageele:erissuedtoprovideguidanceonn
requirementsapplicabletoHECMloansandFHA‐approved
mortgageesundertheHousingandEconomicRecoveryActo
2008(orHERA),ML2008‐24addressedtheprohibi1onagain
thesellingofotherfinancialorinsuranceproductsinconnec
withaHECMloan.ML2008‐24alsoimplemented
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therequirementundertheHERAthatallpar1espar1cipa1ngin
theorigina1onofaHECMbeapprovedbyHUD.
SparkedbyahearingonreversemortgagesbytheSenate
Subcommi:eeonAginginDecember2007,highligh1ngthe
plightofseniorssoldnon‐suitableannuityproductsa`er
procuringareversemortgage,HERAaddednewSec1on
255(n)()totheNHA,whichprovidesabroadprohibi1onon
crosssalesofotherfinancialorinsuranceproductstoHECMborrowers.Specifically,aHECMoriginatororanyotherparty
thatpar1cipatesintheorigina1onofanFHA‐insuredHECM
shall()notpar1cipatein,orbeassociatedwith,oremploy
anypartythatpar1cipatesinorisassociatedwith,anyother
financialorinsuranceac1vity;or(2)demonstratetoHUD
thatthemortgageeorotherpartymaintains,orwillmaintain,
firewallsandothersafeguardsdesignedtoensurethat(i)
individualspar1cipa1ngintheorigina1onofaHECMhaveno
involvementwith,orincen1vetoprovidethemortgagorwith,
anyotherfinancialorinsuranceproduct;and(ii)themortgagor
shallnotberequired,directlyorindirectly,asacondi1onof
obtainingaHECM,topurchaseanyotherfinancialorinsuranceproduct.
ML2008‐24announcedthatFHAwillissueregula1ons
concerningthiscross‐sellprohibi1on,andwillseekcomments
fromthepublic,includingconsumergroups,industry
par1cipantsandotherinterestedpar1esthroughappropriate
administra1vemeans.Thepurposeofsuchcommentsisto
assisttheFHAindeterminingwhatrequirementsmayalread
beinexistencetoaddressconsumerprotec1onsunderSec1
255(n)().Forexample,ML2008‐24notedtheremaybe
staterequirementsinexistencethatalreadygoverninsuranc
products.
ML2008‐24alsoadvisedthatintheinterim,un1ltheFHAiss
moredefini1veguidance,mortgagees()mustnotcondi1o
aHECMonthepurchaseofanyotherfinancialorinsuranceproducts,and(2)shouldstrivetoestablish,consistentwith
theHERA,firewallsandothersafeguardstoensurethereisn
unduepressureorappearanceofpressureforamortgagort
purchaseanotherproductoftheoriginatorortheoriginator
company.
NotethattheHERAalsoaddedanewprovisiononan1‐
tying.ThenewSec1on255(o)oftheNHAprovidesthata
seniorborrowermaynotberequiredtopurchaseinsurance,
anannuity,orothersimilarproductsinordertoobtaina
HECMloan.Thisrestric1ondoesnotapplytocertaintypes
ofinsurancenormallyrequiredwithaHECMloan,suchas1tleinsurance,floodinsuranceandhomeowners’orcasualty
insurance.
TheHERAalsoaddedSec1on255(n)(2)totheNHA,requiring
par1esthatpar1cipateintheorigina1onofFHA‐insuredHEC
tobeapprovedbyHUD.Thisrequirementeffec1velyelimina
thesocalled“HECMAdvisor”programunderwhichanon‐
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FHA‐approveden1tycouldprovidecertainlimitedservicestoa
borrowerinconnec1onwithaHECMloaninreturnforalimited
brokerfee.
AccordingtoML2008‐24,beginningwithFHAcasenumbers
assignedonora`erOctober,2008,onlyFHA‐approved
mortgageesmaypar1cipateinandbecompensatedforthe
origina1onofFHA‐insuredHECMloans.ML2008‐24explained
thattheorigina1onofaHECMloanmustbeperformedbyFHAapproveden11esincluding()aFHA‐approvedloan
correspondentandsponsor;(2)aFHAapprovedmortgagee
throughitsretailchannel;or(3)aFHA‐approvedmortgagee
workingwithanotherFHA‐approvedmortgagee.
NotethatFHA’searlierMortgageeLe:er(ML2008‐4,which
isnotseparatelydiscussedinthisar1cle),providedguidance
onhowanon‐FHA‐approveden1ty(i.e.,a“HECMAdvisor”)
couldpar1cipate,andbecompensated,inconnec1onwiththe
origina1onofHECMloans.InML2008‐24,theFHArescinded
ML2008‐4,effec1veOctober,2008.HECMAdvisor
programs,previouslycommonwithintheindustry,arenolongerpermi:ed.
ML2008‐28
Next,onSeptember29,2008,theFHAissuedML2008‐28,
addressingtheprohibi1ononlender‐paidHECMcounseling.
TheHERAamendedcounselingrequirementsforprospec1ve
HECMloanapplicantstopromotetheindependenceofthe
counselingfunc1onbyprohibi1nganypartyinvolvedinthe
origina1onofaHECMfromdirectlyorindirectlypayingforor
providingfundingtothecounselingagency.ThroughML2008‐
28,theFHAformallyimplementedthisprohibi1on.
LenderscannolongerpayHUD‐approvedcounselingagencies,
directlyorindirectly,forcounselingservicesthrougheither
alump‐sumpaymentoronacase‐by‐casebasis.ML2008‐
28reiteratedthatprospec1veHECMborrowersmustreceive
adequatecounselingfromanindependentthirdpartythatis
noteitherdirectlyorindirectlyassociatedorcompensatedby
apartyinvolvedin()origina1ngorservicingtheHECM,(2)
fundingtheHECMloan,or(3)thesaleofannui1es,investments,
long‐termcareinsurance,oranyothertypeoffinancialor
insuranceproduct.
ML2008‐28alsoprovidedexamplesofprohibitedindirectlender
fundingofcounseling,includingalenderfunnelingpaymentfor
HECMcounselingthroughanonprofit,founda1on,associa1on
oranyotheren1tyororganiza1onthatisabranchof,affiliated
withorassociatedwiththelender.
ML2008‐33
OnOctober20,2008,theFHAissuedML2008‐33,implemen1ng
amendmentstotheNa1onalHousingActmandatedbyHERA
andauthorizingHECMforPurchasetransac1ons.Thenew
HECMforPurchaseprogramwillbeavailableforHECMswith
FHAcasenumbersassignedonora`erJanuary,2009.
ML2008‐33clarifiesthatseniorborrowersmustmakeadow
paymentsufficienttosa1sfythedifferencebetweentheHEC
principallimitandthesalespriceforthepurchasedproperty
plusanyHECMloanrelatedfeesthatarenotfinancedor
otherwiseoffsetbyotherallowableFHAfundingsources.
Seniorswilleitherneedtousecashonhandorcashfromthe
saleofotherassetsforthisdownpayment.Asisthecasew
HECMrefinancetransac1ons,seniorsmaycon1nuetofinanc
closingcosts,orelecttopaythemoutofpocket.
AsexplainedinML2008‐33,seniorsobtainingaHECMfor
Purchasemaynotobtainabridgeloan(orsocalled“gap
financing”)oremployotherinterimfinancingtechniquesto
meetthedownpaymentrequirementsand/orpayforclosin
costsinconnec1onwithHECMforPurchasetransac1ons.T
restric1onincludessubordinateliens,personalloans,cash
withdrawalsfromcreditcards,sellerfinancingandanyother
lendingcommitmentsthatcannotbesa1sfiedatclosing.
Lendersarerequiredtoverifythesourceofallfundspriorto
closing.
ML2008‐33alsopointsoutthatpurchasemoneymortgage
transac1onsgenerallyarenotrescindableunderthefederal
Truth‐in‐LendingAct(andRegula1onZ).However,lendersar
stronglyencouragedtoconsultwiththeircounseltoassure
compliancewithapplicableFederalorStatelaws.
ML2008‐33didnotprovidespecificguidanceconcerning
theloandocumentsfortheHECMforPurchaseprogram.
However,lendersshouldconsiderreviewingtheirstandard
HECMdocumentspriortousingtheminHECMforPurchase
transac1ons.Forinstance,theloandocumentsshouldreflec
thatseniorsmustoccupythepropertywithin60daysfromtdateofclosing,andalsomustcomplywithanystate‐specific
requirementsforpurchase‐moneytransac1ons.
Similartoatradi1onalHECM,aHECMforPurchasemustbe
securedbyrealestateheldinfeesimple,oronaleasehold
underaleasefornotlessthan99yearswhichisrenewable,
orunderaleasehavingaremainingperiodofnotlessthan5
yearsbeyondthedateofthe00thbirthdayoftheyoungest
mortgagor.
CertainpropertytypesareineligibleforFHAinsurance
undertheHECMforPurchaseprogram,including(i)co‐
ops;(ii)newlyconstructedproper1eswhereacer1ficateof
occupancyoritsequivalenthasnotbeenissued;(iii)exis1ng
manufacturedhomesbuiltbeforeJune5,976;and(iv)
exis1ngmanufacturedhomesbuilta`erJune5,976thatf
toconformtotheManufacturedHomeConstruc1onSafety
Standards.
Lendersarerequiredtoensurethatanyconstruc1onloan
financingforthepropertyissa1sfiedandtheHECMlienswil
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nutshell,ML2008‐38definedthatnon‐recourse,inapplica1on
toaHECMloan,meanssimplythatiftheborrower(or
estate)doesnotpaythefullmortgagebalancewhendue,the
mortgagee’sremedyislimitedtoforeclosureandtheborrower
willnotbepersonallyliableforanydeficiencyresul1ngfromthe
foreclosure.Non‐recoursedoesnotmeanthattheborrower,
ortheborrower’sestate,ifitchoosestopay‐offtheHECM
obliga1on,maydosobypayingthelesserofthefairmarket
valueofthepropertyorthefullindebtedness.
Iftheborrowerortheborrower’sheirsorestatedonot
wishtokeeptheproperty,theymaysellthepropertyforthe
lesserofthefullmortgagebalanceor95%oftheproperty’s
appraisedvalue.ML2008‐38explainedthatthesaleofthe
propertyshouldbeanarm’slengthtransac1on.Anarm’slength
transac1onischaracterizedinML2008‐38asmee1ngthe
followingrequirements()theabsenceofarela1onbetween
thebuyerandseller;(2)asellingpriceandothercondi1onsthat
wouldprevailinanopenmarketenvironment;(3)transac1on
costspaidbythesellerthatareconsideredbothreasonableand
customaryforthemarketinwhichthepropertyislocated;and(4)theadherencetoethicalstandardsofconductbyallpar1es
involvedintheHECMshortsaletransac1on,includingthe
borrowers(ortheestate),mortgageesandappraisers.
Ifthenumberandcomplexityofthemortgageele:ersissue
byFHAisameasureofchangewithinourindustry,thereisn
doubtthat2008hasbeenanhistoricyear.HECMoriginators
andlendersareencouragedtoworkwiththeirinternal
teamsandappropriatesubjectma:erexpertstoensurethat
thesechangesarebothfullyunderstoodandanynecessary
modifica1onstosystems,processes,policiesandprocedures
implemented.
Asanindustry,itisourcollec1veresponsibilitytoensuretha
theseniorsweserveareprovidedaposi1veexperienceand
affordedallofthebenefitsandconsumerprotec1onfeature
mandatedbyFHAundertheHECMprogram.
Becauseofthegeneralityofthisar&cle,theinforma&on
providedhereinmaynotbeapplicableinallsitua&onsand
shouldnotbeacteduponwithoutspecificlegaladvicebased
par&cularsitua&ons.
ByJoelSchiffmanandFedKamensky,ofthelawfirmofWein
BrodskySidmanKiderPC.ThelawfirmservesasGeneral
CounseloftheNa&onalReverseMortgageLendersAssocia&o
andascounselandadvisortoreversemortgagelendersand
otherindustrypar&cipantsthroughoutthena&on.Thelawfi
hasofficesinWashington,DC,NewportBeachandHouston.
Addi&onalinforma&onmaybefoundatwww.wbsk.comorby
telephoneat202.628.2000.Messrs.SchiffmanandKamensk
com.
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AA
Guide to Following
Up Valerie VanBooven
Impact is not created by big budgets; it is created by innovative marketing approaches....
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Hiandhappycomingnewyear!2009willbespectacular
forthosewhotakethe1metoreallyunderstandwhat’s
requiredfora:rac1ngandmaintainingnewclients.It’s1me
toshi`gearsandmoveintosomenewstrategiesthatspice
upyourmarke1ngplanswithoutcos1ngabundle.
Thisar1clewillillustratestepbysteptheblueprintfor
respondingtoleadsthatcometoyouviaemail,internetleadsprograms,yourwebsite,oranyonlinemethod.
Gengleadstocometoyouviatheinternetisacompletely
differentconversa1onthanhowyouRESPONDtoleadsthat
comeyourway.
Ifyouareaseniorserviceprovider,thisblueprintgivesyou
thetoolstoimplementinyourownbusinessthatwillmake
abigdifferenceinwhathappenstothepeople/caregivers/
seniorswhoinquireaboutyourservices.
Forthepurposesofsimplicity,IamgoingtouseABC
ReverseMortgagesasmyexample.It’snotrocketscience,butasimplefollow‐upplanthatkeepsYOUinfrontofyour
prospectsandpoten1alfutureclientsforseveralmonths.
Follow‐upisourbiggestdownfall.Wouldn’tyouagree?As
businessownersweallknowthattherearethoseprospects
whofallthroughthecracks,onlytobecontactedbyour
compe11onjustattheright1me,andsuddenlyoutofreach
forus.
It’s1metomakethatsitua1onathingofthepastandfollow‐
upwitheverysingleinquiryforaslongasittakes.Howlongisthat?Un1ltheyasktonotbecontacted.Simple.You
follow‐upinawonderfullyposi1veandeduca1onalwayun1l
you’reaskedtostopeitherverbally,byemail,orle:er,etc.
Didyouknowthatwhenacoupledecidesto“think”about
sellingorbuyinganewhome,ito`entakesthemafull6‐8
monthstoREALLYmakethefinaldecision!?
InsomecasesyourprospectsneedhelpRIGHTNOW,and
other1mes,theyareinves1ga1ngtheirop1ons‐and“geng
ready”“justincase”anaginglovedonemightneedhelp
atsomepoint.(Transla1onTheiraginglovedoneprobablyneededhelp6monthsago,but6moremonthswillpass
beforethereisaneventthatcatapultsthefamilyintotrue
crisis‐andinneedofyour,oryourcompe1torsservices).
Doyourselfafavorandfromnowonmakesurethatforallof
thoseclientswhoare“justlooking”,“educa1ngthemselves
aboutop1ons”,etc‐YOUwillbetheagency,individual,or
companyofchoicewhenthe1mecomes.
Inotherwords,makesurethateveryfamilyyoutouchkn
thattheywouldbeabsolutelycrazytodobusinesswith
anyoneelsebutyou!Iwon’tgointoanin‐depthanalysis
ofWHYyoushouldusetheitemsIrecommendhere,that
anotherdiscussionen1rely.However,eachpieceofthe
blueprintisrecommendedanddesignedtoSETYOUAPA
fromtheCOMPETITION.
Step1:Assoonasaleadarrivesinyouremailboxoron
yourphoneline:Callimmediatelyasanintroduc1on,ans
ques1ons,andconfirmcontactinforma1on.
Exhibit A: Call Script 1
HiMrs.JonesthisisValeriefromABCReverseMortgage
Wejustreceivedanoteonourcomputersystemthatyo
havesomeques&onsaboutreversemortgagesforyour
father/mother.
Whatkindofques&onscanIanswerforyourightnow?
ummI’mnotsure…..
WehaveafreeDVD/audioCD(orweno&cedthatyou
haverequestedourfreeDVD/audioCD)called:YourMo
Cri&calAsset.(Note:Imadethisnameuponthefly,use
yourown.)
WoulditbealrightifImailedthatouttoyourightnow,
alongwithourbrochure?
Yes
<Gathermailinginforma&onifyoudon’talreadyhavei
Okthen,Iwillbecallingyoubackinabout4daystosee
youhaveanyques&onsaerviewingtheDVD/listening
theaudioCD.
Aremorningsoraernoonsbeerforaphonecall?
Mornings
OkMrs.Jones,I’lltalktoyouattheendoftheweek,an
I’llbesuretocallinthemorning.
Ifyouhaveques&onsbeforethat&me,don’thesitateto
callmerightaway.IfyouhaveapenandpaperI’llgive
youmyphonenumber.888‐888‐8888.
ThanksMrs.Jones,andI’lltalktoyousoon.
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42 reversereview.com
“
Step2:Emailimmediatelya`erphonecall‐“THANK
YOU”anda:acha“FREEREPORT”(no1ceIdidnotcallit
abrochure).YourFREEREPORTshouldcomplementthe
contentsofyourDVDorAUDIOCD.Yes,Imen1onedDVDor
AudioCD…youneedoneofthese.
Exhibit B: Email 1- modify depending on
your discussion on the phone. Dear Mrs. Jones,
My name is Valerie VanBooven RN BSN, from ABCReverse Mortgages.
We just received a note on our computer systemthat you have some questions about a reversemortgage for your father/mother.
(Or- It was a pleasure speaking with you today regarding the care needs for your mother/father)
We will be sending you our new DVD/Audio CD: Your Most Critical Asset.
We believe that the information contained in this DVD/ Audio CD will give you information and tips on choosing a good lender, and will help you makeinformed decisions moving forward.
I will call you to follow up in a few days and seeif you have any questions. In the meantime, look for your package in the mail from us.
If you would like to view/listen to thematerials online right now, you can visit www.ReverseMortgageNation.com/valerievanbooven
If you have questions before that time, don’thesitate to call me right away.
888-888-8888
Warmest Regards,Valerie VanBooven RN BSN
P.S. Attached is a REPORT that our clients havefound extremely helpful in understanding how obtain a reverse mortgage.
Step3A:USPSMailHandaddressedenvelope.Envelope
shouldsay“TheInforma1onYouRequestedisEnclosed”
cangetacheaprubberstamp,orprint50labelsata1me
andusethemasneededforyourenvelope.Keepitsimple
Step3B:Insidetheenvelope‐thankyoule:ersimilartot
emailyouoriginallysent,andthefreereportyouoriginal
emailed.Also,sendaDVDorAUDIOCDthatsummarizesyourservicesin8‐0minutes.
Exhibit C: US Mail Letter 1- modify depending on your discussion on the phon
Dear Mrs. Jones,
My name is Valerie VanBooven RN BSN, from ABCReverse Mortgages.
Thank you for ordering your DVD/Audio CD: : YouMost Critical Asset.
(Or- It was a pleasure speaking with you today regarding the care needs for your mother/father)
We believe that the information contained in this DVD/ Audio CD will give you information and tips choosing a good home care provider, and will help you make informed decisions moving forward.
I will call you to follow up in a few days and seeif you have any questions. In the meantime, please
be sure to view this DVD. (listen to this audio CDIf you have questions, don’t hesitate to call meright away.
888-888-8888
Warmest Regards,Valerie VanBooven RN BSN
P.S. Attached is a REPORT that our clients have found extremely helpful in understandinghow obtain a reverse mortgage.
Do yourself a favor and from now on make sure that for all of thosthemselves about options’, etc- YOU will be the agency, individual, o
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Dec 08 / Jan 09”
Ifyoudon’thaveaDVDoraudioCDthatyoucanhand•
outtoprospectsandreferralsources(orpreferably
both),youneedtogetonemadeYESTERDAY.TheDVD
shouldhaveacompellingandgutpunching1tlethat
makesthe“receiver”feelobligatedtowatchit.
Step4:Wait4daysformailtoarrive.
Step5:Followupphonecall.Didtheyreceivethe
informa1onyousent?Dotheyhaveanyques1ons?Didthey
watchyourDVDorlistentoyourCD?
Exhibit D: Script 2- modify depending onyour discussion on the phone and any other communication.
HiMrs.JonesthisisValeriefromABC.I’mfollowingupon
theDVD/AudioCDthatwemailedtoyouthisweek.Have
youhadachancetoreviewtheinforma&on?
Whatkindofques&onscanIanswerforyourightnow?
ummI’mnotsure…..
Wouldyouliketosetupanappointmenttomeetwithme
anddiscussyourcurrentsitua&on(regardingyourfather)‐
thereasonIaskisbecauseevenifourservicesaren’t
exactlywhatyouarelookingforrightnow,wemaybeable
topointyouintherightdirec&onforotherservicesinour
area.Thereisnochargefortheappointment.
Yes
Aremorningsoraernoonsbeerforyou?Wouldyou
preferTuesdayorThursday?
Ok,IwillseeyouonThursdayat10amatyourhome.
Ifyouhaveques&onsbeforethat&me,don’thesitateto
callmerightaway.IfyouhaveapenandpaperI’llgiveyou
myphonenumber.888‐888‐8888.
ThanksMrs.Jones,andI’llseeyousoon.
»
who are ‘just looking’, ‘educatingny of choice when the time comes.
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Dec 08 / Jan 09
America’sRecommendedMailers,Inc.
800.992.2722
armleads.com
AppraiserLo
877.229.7799
appraiserlo`.com
Celink
57.32.9002
www.celink.com
Na&onalHousingCounselingAssocia&on
50.287.6085
learnreverse.org
NextGenera&onFinancialServices
888.973.8377
www.ngfs.net
OnTheLevel
800.909.0
onthelevelcontractors.com
ReverseMarketInsight,Inc.
949.429.0452rminsight.net
ReverseFortunes.com
866.592.2096
reversefortunes.com
ReverseMortgageAssocia&onfor
LoanOfficers
877.262.7656
remalo.org
ReverseVision
99.834.0070
reversevision.com
1stReverseFinancialServices,LLC
ASubsidiaryofWilmingtonSavings
FundSociety,FSB
877.574.000
streverse.com
director
Interna&onalDocumentServices
800.554.872
idsdoc.com
PremierReverseClosings
800.542.43
prclosings.com
WeinerBrodskySidmanKiderPC
202.628.2000
wbsk.com
AtareE.Agbamu,CRMS
62.203.9434
thinkreverse.com
DirectGroup
888.799.3959
dgmortgagemarke1ng.com
LoanWellAmericaInc.
877.700.0555
loanwellrm.com
MonteRose
800.56.0545
monterose.biz
ReverseMortgageDaily reversemortgagedaily.com
Ibis
800.566.5070
reversemortgagehomepage.com
OmniReverse800.628.5093
omnireverse.com
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46 reversereview.com
Bre:Varner‐LessonsLearnedfrom2008
the last word
WHY IT’S A
GREATTIME
TO START A
CAMPAIGN IN 2009
RR
www.reversereview.com
Magazine
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