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2011: Year of Recovery?


 Reverse Mortgage Industry Recovery

A bullish outlook for 2011…

We have just finished perhaps two of the most challenging years the reverse mortgage industry has ever faced. The 2009 PLF (Principal Limit Factor) cuts, plunging home values and economic uncertainty have resulted in a 31% reduction in reverse mortgages for the fiscal year 2010. The saying “when you’ve hit the bottom there’s nowhere to go but up” comes to mind. Perhaps.

According to a recent report issued by Reverse Market Insight, there is reason for some optimism in fiscal year 2011 (begins October 2010). Why? Home depreciation has slowed indicating we may be closer to the bottom, the new PLF floor (4.99%) giving some borrower higher proceeds and the emergence of the HECM Saver. In a recent podcast interview with HUD’s Deputy Assistant Secretary Vicki Bott, I learned that the HECM Saver is more than just a new product, but has helped the Traditional HECM reducing the need for substantial subsidy requests. The projections are a marked increase for 2011. (Read the full RM Insight report here).

So now the questions:
1- Do you believe we will see an increase volume this year?

2- What are your plans to market the HECM Saver?

Please leave your comments in the comment section below…


Leave a Comment


  1. Yes I do believe we will see a volume increase for FY 2011. And I plan to integrate the HECM Saver into my overall marketing strategy. It’s a positive for us, and we need to make our audience aware of this new option.

  2. The big question is still education. Seniors do not understand how a reverse mortgage works. They are afraid they will lose their home. All they hear and read is negative.

    Volume should go up. HECM saver is a good program. New counseling project is very negitive. Does not help things at all.

  3. We are beginning to see our faces and names returning to the industry which shows there are expectations that things will be picking up again. I really agree with Bob that counseling is a negative and could do real damage to any recovery in the industry.

    If it were not for the 1.25% annual MIP, our outlook might be much better. Some are concerned that this could become a real negative. In fact some are concerned that this might not have been the right time to introduce the Saver because of the 1.25%.

  4. How anyone can look at the reports, look at the numbers, analyze them with a non-biased perspective, and become or remain bullish about 2011 for this industry is beyond me! Give all of the data to someone outside of the industry and se what they say! I won’t pontificate here as I could, I’ll just sum it up with my best bet – overall, 2011 will be flat or down from 2010. This is the new low, and nothing on the horizon is going to launch it off off the new norm anytime soon.

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