How do we break the cycle of change, volume reductions, and bounce back?
It’s no secret. Industry stakeholders, originators, and pundits have lamented the stagnation of reverse mortgage originations since the housing meltdown of 2009. Certainly we could partially attribute the lack of market expansion to the exit of big bank lenders such as Wells Fargo and Bank of America. We could also point to fewer applicants meeting the requirements entailed in the Financial Assessment. Perhaps more significant are the series of lending ratio or principal limit factor reductions that have closed the door to homeowners seeking to payoff a significant mortgage balance.
While reportedly 10,000 baby boomers retire each day, home values rising, and more retirees are lacking the funds to retire comfortably, fewer are taking a reverse mortgage. This paradox begs further examination.
Perhaps one clue can be found in our industry’s historic response to product changes. For example the…