[vimeo id=”135080321″ width=”625″ height=”352″]
Some Lenders Welcome Financial Assessment
Three months following the enactment of the Financial Assessment some smaller reverse mortgage lenders are finding the new guidelines a breath of fresh air.
A welcome change? Surprising since reverse mortgage endorsement numbers have fallen after the assessment became baked into the origination of Home Equity Conversion Mortgages. Where is the sweet spot for the assessment? It would appear to be with smaller lenders.
Robert Wyatt, president of Reverse Mortgage Advisors, LLC said “As a small independent shop I’m seeing that the FA has created a need to really sit down face-to-face or kneecap-to-kneecap, with potential borrowers to explain the process. This has really been a benefit to us.” While many may not share the same sentiment due to numerous guidelines and documentation requirements, some have found a silver lining despite the overall pushback by many loan originators. That silver lining is…
Download a transcript of this episode here.
Looking for more reverse mortgage news, commentary and technology? Visit ReverseFocus.com today.
1 Comment
It was surprising to hear Shannon say that financial assessment has resulted in lower endorsement numbers. The endorsement numbers for June and July 2015 were both over 5,000. June 2015 is the first time we have hit 5,000 endorsements since February 2014. In fact the endorsements for June 2015 were the best since August 2013, almost two years ago.
Yet what is stranger is that there would be any talk about a substantial number of HECMs which have gone through financial assessment being endorsed before August. The first ones got their case assignment numbers on April 27 and in the past when an application without financial assessment turned into a closed HECM, it took an average of about 4 months (called the lag) to go from case number assignment to endorsement. Due to increased processing and underwriting time for applicants undergoing financial assessment, the lag for the average HECM going through financial assessment could be as long as five months. So we would be lucky to see a significant number of HECMs which went through financial assessment getting endorsed in August.
There was a huge surprise which can only be attributed to financial assessment. The total case numbers assigned in May, 2015 is the worst since March 2004!!! (HUD has not released case number assignment information for either June or July.)
Is financial assessment best for TPOs? Absolutely not. It is best for FHA approved Mortgagees who contingently bear risk for property charge defaults. While financial assessment might be a springboard to more productive calls with prospects, it is Mortgagees who stand to gain the most.
(The opinions expressed in this comment are not necessarily those of RMS or its affiliates.)