Product Innovation and Rebranding
Former British Prime Minister Harold Wilson said “He who rejects change is the architect of decay. The only human institution which rejects progress is the graveyard.” This admonishment could well apply to the reverse mortgage industry today. Due to economic and regulatory pressure the HECM program has evolved rapidly in recent years. The truth is the choices that our industry collectively makes today will determine the outcome of tomorrow. What changes can we anticipate in the coming year? Here are just a few elements we should be watchful for.
First are new HECM product. Not private or proprietary but variations of the reverse mortgage which meet HECM guidelines. Early attempts by some lenders to reintroduce a fixed rate HECM were halted by HUD who prohibited any future draws for fixed rate Home Equity Conversion Mortgages. As we push toward a more financially astute borrower lenders may attempt to fashion products that appeal to this demographic. We should keep in mind with HUD’s strict HECM guidelines innovation is limited. Future products should seek to…
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