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What Can Be Done Despite Delayed Loan Closings

reverse mortgage newsYou may be experiencing some frustration as of late. With the rapid pace of changes to the HECM reverse mortgage your loans may be taking unusually long to close. Processors and underwriters are being stretched to comply with new regulations and guidelines and your loan pipeline may be slowing at the end.

This is where backfilling your pipeline will be key to your success this year. This situation reminds me of the famous serenity prayer which reads “God grant me the serenity to accept the things I cannot change: courage to change the things I can: and wisdom to know the difference.”

When it comes to slowdowns you may be experiencing most of them are simply out of your control or sphere of influence. The good news is with time comes increased efficiency. Many lenders may be stretched now but will be adapting quickly to…

Download the video transcript for this episode here.

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  1. My concern is not turn times. Most of us will be preparing our borrowers for that probability.

    The problem will be volume and revenues, beginning in March. Yes, back filling is crucial but we will be facing a reduced market of seniors who can qualify in late February. This ain’t exactly fiscal 2006 when the air was filled with realistic optimism about endorsements growing and it seemed like seniors were waiting for us outside our homes so that they would get their application in (one can dream about the past, right?).

    I hate to say this because like most of us, I really like Shannon, but the one feeling I could immediately relate to after today’s word of admonition from Shannon was what Pharaoh’s slaves must have felt like when their taskmasters told them that brick production was expected to go up despite removing a key ingredient, straw. While we may not be slaves subject to whippings, etc., we have had three volume diminishing items put on us with the goal of increasing loan production: 1) lower principal limit factors since September 30, 2013 (with a slight reprieve since 8/4/2014), 2) a substantial first year limitation on disbursements, and 3) soon financial assessment which means fewer applicants will be eligible to be borrowers.

    Now we also face even more costs to the MMI Fund from the four non-borrowing spouse policies released by HUD over the last nine months or so. With HUD missing its December 2013 prediction for fiscal 2009 (the end of which was about ten months away from the prediction) by $8.7 billion, one wonders not only what kind of hit the MMI Fund will take since it has more active HECMs outstanding than the General Insurance Fund but what will be the hit to the MMI Fund for 1) the current year book of business and 2) for all HECMs which were active as of the end of fiscal year 2014. So hold onto our collective hat, more could coming just around the corner.

    Ah, the joys of living and working in the “HECM World.”


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