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Tell Me a Lie if it’s True

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Four Lies We Tell Ourselves That Stop Success

reverse mortgage newsWe all know that lying is harmful and toxic and we should be honest in our dealings with others; but what about lying to ourselves? This form of deception is especially harmful as we all can cut ourselves a deal, take shortcuts or even worse derail our plans for success. A recent article by Robert Locke uncovers some of the lies we tell ourselves that prevent success. As I read I began to ask myself “do I do this to myself”?

Lie #1- I must never fail. Fear of failure ruins everything it touches. It instills hesitation, indecision and poor decision making. Failure is our greatest teacher and is often the necessary pitstop on our journey to success.

Lie #2- I need luck. Sure a lucky break is welcome…

Download the video transcript for this episode here.

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  1. If Shannon Hicks is not the voice of our industry, who is? I will never forget the surprise I felt when Jeff Lewis was given this designation through an online vote at Reverse Mortgage Daily. Within a few years the so called voice of our industry was gone and now so is his company.

    Switching back to the theme of this post, let us look at another application of this do not lie to yourself or others. Who is not hearing the need to drive up endorsements today? Yet as Colin Cushman made clear in his email as reported by Reverse Mortgage Daily, the problem is with lower origination revenues due to lower unpaid balances due at initial funding. Yes, operating costs are up but if average revenues per endorsement were up,those increases would be tolerable.

    Let us not lie or accept lies which are foisted on us. Only having Saver v.3 puts the industry at a strong disadvantage when compared to having both a Standard and a Saver. Endorsements are not going down just because we do not know how to present or sell HECMs. They are going down because today’s product is inferior in meeting the needs of seniors.

    If anyone believes that proprietary reverse mortgages will save the industry, please do not spread that myth. The only lender to provide a proprietary product since 2008 has been Generation and as EricSD pointed out the other day in a comment about Generation leaving the industry on Reverse Mortgage Daily, he did a proprietary reverse mortgage for a client that ended up providing over $2.4 million on a home worth $9 million. While Generation put a lot of restrictions on who can qualify than during the heydays of these products, do not expect the latest entries to do much better. Unlike HECMs, they are not a national product.

    Once we get through the smoke, mirrors, and propaganda, what we find is an industry devastated by its HECM insurer, FHA. Looking at the miserable endorsement total for September, one wonders if a rate of about 45,000 endorsements will be enough to keep the industry intact especially in light of the over 40% drop in HECM revenues per HECM we are seeing today.

    The question we all should be looking at is if HUD implements financial assessment by January 1, 2015, how will our volume fare? Even if the initial roll out of the Extreme Summit has been successful so far (a big question not yet answered by NRMLA), can the large lenders endure a huge increase in this cost through 2018? There is no indication of success of the campaign reflected in case numbers assigned through July 2014, that there is any real improvement in endorsements on its way but it is far too early to make any clear statement based on empirical evidence available to the public about its success. NRMLA has that information so it will be interesting to hear what it and the leaders of the Extreme Summit have to say next month in Miami.

    Let us not lie to our peers or ourselves and let us stop spreading industry generated myths.


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