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AARP: Rising Rates Hit Reverse Mortgage Payouts

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EPISODE #823

AARP notes interest rate impact on would-be reverse mortgage borrowers

[AARP]

“Just as they are for homeowners or would-be homeowners with conventional mortgages, higher interest rates are bad news for people who have or are considering reverse mortgages. But not entirely, and not necessarily in the ways they might think.”


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Editor in Chief: HECMWorld.com
 
As a prominent commentator and Editor in Chief at HECMWorld.com, Shannon Hicks has played a pivotal role in reshaping the conversation around reverse mortgages. His unique perspectives and deep understanding of the industry have not only educated countless readers but has also contributed to introducing practical strategies utilizing housing wealth with a reverse mortgage.
 
Shannon’s journey into the world of reverse mortgages began in 2002 as an originator and his prior work in the financial services industry. Shannon has been covering reverse mortgage news stories since 2008 when he launched the podcast HECMWorld Weekly. Later, in 2010 he began producing the weekly video series The Industry Leader Update and Friday’s Food for Thought.
 
Readers wishing to submit stories or interview requests can reach our team at: info@hecmworld.com.

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1 Comment

  1. Is it all about interest rates? Perhaps, if one ignores the damage done to HECM principal limit factors (similar to loan to value ratios and used to determine gross proceeds at closing) by the Trump Administration on 10/2/2017. For its own reasons, the Biden Administration has done nothing to turn back those changes so that the HECM can provide the financial cash flow relief to participating senior homeowners that HECMs were initially designed to provide.
    .
    What we have seen in the last six months is what can generally be described as the worst start to any HECM fiscal year since September 30, 2003. Worse, based on HECM CNAs (Case Number Assignments) and an ongoing annualized and modified pull through rate, the third quarter (ending June 30, 2024) of this fiscal year will most likely have a lower HECM endorsement total than either the first quarter or second quarter of this fiscal year. It is now anticipated by some number crunchers in the industry that this fiscal year ending September 30, 2024 could easily end up being the worst HECM endorsement total for any fiscal year in stretching back 21 fiscal years.
    .
    If anyone in 2008 would have suggested that this is where the HECM market would be
    almost 16 years later, I would have laughed as I am sure many others reading this comment would have.


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