No one, really, even though it could be a retirement gamechanger.
In an article earlier this month with Housingwire, Jessica Guerin talks about the troubles the reverse mortgage industry has had promoting the Home Equity Conversion Mortgage (HECM) for Purchase program.
“It’s safe to say that many people know that a reverse mortgage is a loan that can be used by older homeowners who want to extract the equity in their house. But what many people don’t know is that there is a type of reverse mortgage that can be used to purchase a house. And while it’s not for everyone, it could be a retirement gamechanger for a good number of people.”
She continues, “It’s not uncommon to sell off the family home and downsize or relocate as you reach retirement. According to the National Association of Realtors, older adults comprise 38% of homebuyer market, and most choose some kind of financing. Obviously, paying 100% cash for a new house isn’t realistic for most people, but taking on a mortgage in retirement isn’t exactly ideal. There’s another option out there: a little-known, barely used variation of the reverse mortgage.”
Jessica goes on to mention that since 2013 lenders have only originated 11,000 HECM for Purchase loans. She also quotes professions in the industry
who blame the fact that most reverse mortgage specialists don’t know how to talk to real estate agents.
One of these professionals is Michael Banner, President of Professional Mortgage Alliance, who notes how with a HECM for Purchase loan, buyers can afford to purchase a more expensive home.
“Mr. Realtor, what would you like a commission on – a $300,000 house or a $400,000 house? You could increase your commission by 33% with this,” he said. “The upsell, the higher commission, that’s what’s going to get the Realtor’s interest.
If you’re interested in learning about the HECM for Purchase program and gain 2 continuing education credits while doing so, I’m approved by DORA to teach free a 2-hour CE class on this product and should be having a class later this month. Please keep an eye out for additional e-mails or check my blog at https://www.reversemortgageradio.net for all the details.
You can read the full article here.