Reverse Mortgage Industry No Longer A Black Sheep
San Diego, California The reverse mortgage industry is quickly moving from an obscure
, overlooked and underreported branch of the hotly-debated financial services sector to front page blog, magazine, and newspaper headlines all around the country. Once the subject of controversy and public uncertainty, reverse mortgages are now making the transition into mainstream acceptance as the benefits of the misunderstood loan are gaining attention in light of new, transparent regulations and standards.A reverse mortgage is a loan transaction that allows seniors aged 62 years and older borrow cash against the equity built into their home. Because the client target is seniors and retirees, a demography that has long been susceptible to fraud and scams, the industry was criticized during its initial development as a predatory lending scheme as borrowers filed complaints of high fees and deceptive marketing practices with consumer protection services and agencies.
With no formal regulatory agency or body governing the industry as a whole, reverse mortgages thrived on the demand for supplemental cash during retirement by seniors entering their Golden Years. Now, for the first time, instead of public media covering the niche market as a mysterious plan to thwart the elderly with high fees, interest rates, and misleading terms and consultations, the positive advantages and stories of happy consumers of reverse mortgages are getting more airtime.
In the 1990s, media coverage about reverse mortgages was from small media sources and primarily focused on product misconceptions. However, in the past few years we have seen a number of large news organizations actually begin recommending reverse mortgages as an important piece of the many peoples retirement puzzle. said Jim Cory, President of Legacy Reverse Mortgage in San Diego, California. Today, the reverse mortgage industry landscape incorporates resources from the Housing and Urban Development (HUD) agency and the National reverse mortgage lenders Association (NRMLA) amongst others, seeking to establish credibility, ethics, and universal standards the media has formerly reported as being inconsistent.
Laws now require than any senior seeking a reverse mortgage will undergo a consultation with a HUD-approved counselor to make sure the borrower understands the complexities of the loan. Further, other products have been developed to cut the costs of the initial insurance premium, one of the biggest reported cost-drivers of the reverse mortgage. Lenders are doing their part, too. Legacy Reverse Mortgage has eliminated upfront fees and closing costs all together for their clients with certain loan selections.
The industry evolution and improved attitudes towards reverse mortgages couldnt have come at a better time, with January 1st, 2011 as the official start of the Era of the Golden Boomers entering retirement. Unfortunately, many of these seniors will enter retirement underfunded, and a reverse mortgage is a solution that is growing in popularity now and for some time to come.
About Legacy Reverse Mortgage
Legacy Reverse Mortgage is one of the fastest growing reverse mortgage providers in the country. Legacys management team has over 20 years of combined experience specifically in reverse mortgages, making the firm one of the most experienced and knowledgeable reverse mortgage lenders. Legacys President, Jim Cory, has been working with reverse mortgages for over 12 years, holding posts from Fannie Mae to serving as the Vice Chairman on the Ethics Committee of the National Reverse Mortgage Lending Association (NRMLA). In addition to his work on the Ethics Committee, Mr. Cory accepted a position on the NRMLA Board of Directors in July 2010.
by: Leonard H. Franklin