HECM public perception, policy & property values

by Shannon Hicks
| 2 Comments
| October 17, 2022

<h2 class="p1">Without audience targeting are Google Ads Dead? Think again…</h2> Early this month Google announced new restrictions for targeting specific audiences. The restrictions apply to content related to housing, employment, credit, and those who are disproportionately affected by societal biases. The news of these restrictions created quite a stir among industry brokers and lenders who heavily rely upon targeted Google ad campaigns. All which may have you asking if these changes will kill future reverse mortgage advertising on the world’s most popular search engine. In just a moment we’ll hear from our online SEO expert Josh Johnson to find out. [read more] Google’s restrictions are not necessarily novel nor unexpected. It was just over two years ago Facebook faced scrutiny from federal regulators for allowing those offering credit or housing finance to restrict ad audiences by race or religion among other questionable metrics that would violate HUD’s fair housing rules. An investigation by ProPublica broke this news in October 2016. It was nearly two years later in August 2018 that HUD filed a formal complaint against the social media giant for discriminatory advertising practices. Seven months after HUD’s complaint Facebook announced sweeping changes. Both Facebook and later Google, took a blunt approach much to the chagrin of lenders and service providers. What ad filters are going away? In its official release Google revealed, “credit products or services can no longer be targeted to audiences based on gender, age, parental status, marital status, or ZIP code.” Is this the end of Google ads for reverse mortgages? To answer that question I reached out to Josh Johnson who heads up Reverse Focus’ Online Dominance SEO program and Google marketing. Here’s his explanation. Here’s what makes Google unique from other platforms and why reverse mortgage Google ads will continue to reach the intended audience. To summarize, older homeowners are intentionally seeking out reverse mortgage information on Google which means, yes-your ads will be seen by your target audience, even though you can no longer target specific age groups. <img fetchpriority="high" fetchpriority="high" decoding="async" class="wp-image-21372 alignnone" src="https://apirodev.com/reverse-mortgage-news/wp-content/uploads/2020/09/In-post-pix.004-300x169.jpeg" alt="" width="691" height="389" srcset="https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.004-300x169.jpeg 300w, https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.004-1024x576.jpeg 1024w, https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.004-768x432.jpeg 768w, https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.004-1536x864.jpeg 1536w, https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.004.jpeg 1920w" sizes="(max-width: 691px) 100vw, 691px" /><img decoding="async" class="alignnone wp-image-21373" src="https://apirodev.com/reverse-mortgage-news/wp-content/uploads/2020/09/In-post-pix.001-1024x576.jpeg" alt="" width="681" height="383" srcset="https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.001-1024x576.jpeg 1024w, https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.001-300x169.jpeg 300w, https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.001-768x432.jpeg 768w, https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.001-1536x864.jpeg 1536w, https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.001.jpeg 1920w" sizes="(max-width: 681px) 100vw, 681px" /> <img decoding="async" class="alignright size-large wp-image-21374" src="https://apirodev.com/reverse-mortgage-news/wp-content/uploads/2020/09/In-post-pix.002-1024x576.jpeg" alt="" width="1024" height="576" srcset="https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.002-1024x576.jpeg 1024w, https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.002-300x169.jpeg 300w, https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.002-768x432.jpeg 768w, https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.002-1536x864.jpeg 1536w, https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.002.jpeg 1920w" sizes="(max-width: 1024px) 100vw, 1024px" /> <img loading="lazy" loading="lazy" decoding="async" class="alignright size-large wp-image-21375" src="https://apirodev.com/reverse-mortgage-news/wp-content/uploads/2020/09/In-post-pix.003-1024x576.jpeg" alt="" width="1024" height="576" srcset="https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.003-1024x576.jpeg 1024w, https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.003-300x169.jpeg 300w, https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.003-768x432.jpeg 768w, https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.003-1536x864.jpeg 1536w, https://www.hecmworld.com/wp-content/uploads/2020/09/In-post-pix.003.jpeg 1920w" sizes="(max-width: 1024px) 100vw, 1024px" /> [/read]

Part 2 of our exclusive interview with Dan Hultquist examines the impacts of public perception, policy, and property values on the HECM program.

2 Comments

James E. Veale, MBT
October 17, 2022 at 12:56 pm
I concur with what is presented in Part 2 but have some comments on how both parts can be improved. It was explained to me that the article came about as a result of an email I wrote. Based solely on numeric data, I saw no silver lining for the industry in fiscal 2023. Part 1 and Part 2 only confirm that belief with one small modification.

After Part 1, I reviewed the article with someone I look up to in the industry. He agreed that there was a need for a seventh P that I will call Performance of the HECM Portion in the MMIF. We also looked at the issue of needing a rating system for the seven Ps. In going down the list, the outlook for fiscal 2023 based on a one to five rating with five being highest (excluding HECM Performance which HUD and the Independent Actuaries will report on in about 30 days) we both agreed that only one P deserved a rating of 3, another P a rating of 2 and four of the remaining six demanded ratings of just one.

Many stated that new HECM borrower volume would immediately replace any loss in HECM Refis which has proven to be far more dream than fact. If that volume is substantial or even significant, where is it? Then there is the masterpiece prediction that volume from financial adviser referrals was on the rise which now seems lame when the September 2022 HECM endorsement summary report was released showing just 3,235 endorsements for the month. The last time we saw HECM endorsement volume lower than 3,235 was for April 2020 when HUD shut down its national headquarters in DC due to covid restrictions and total endorsements were just 1,601 for that month.

If the breakdown in the September 2022 endorsement volume shows HECM Refi volume of 500 or more, the outlook is worse than what was anticipated. Some are predicting HECM Refi endorsement volume of 1,000 or slightly more occurred last month; imagine if that were the case. We will most likely have to wait several weeks before the breakdown of endorsements in September 2022 is released on HUD’s website. However, counterbalancing the prediction that endorsement volume will continue to drop is that one month of lower HECM endorsements is not a trend but looking at CNA (Case Number Assignment) data for the months of June, July, and August, 2022, there does not seem much hope of any month in the next three reaching even 4,500 HECM endorsements; such data indicates that total HECM endorsement volume in the first quarter of fiscal 2023 could be as low as 9,400 (probable) and as high as 11,100 (doubtful).

It seems that more and more industry prognosticators are opting out of the forecasting of HECM endorsement numeric volume “business” and leaning on subjective measurements that leave one wondering what they are predicting. I hope to see the modified seven Ps used in making monthly HECM endorsement volume numerical predictions but that does not seem likely.

Then there is the question of whether or not HUD will reintroduce a product in fiscal 2022 or early 2023 that should increase the number of HECM endorsements. If true, I support the move.
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Pat Smoot
October 18, 2022 at 7:41 am
Great review, and YES we must defend our industry and our livelihood.
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