With the FHA predicting a surge in Home Equity Conversion Mortgages (HECM) for Purchases next year to 3,420, up from 423 in 2009’s fiscal year, it seems a little surprising that the industry isn’t more optimistic about the program.
“Everyone in the industry was really excited about it when we realized we were going to get the HECM for Purchase product,” said Monte Howard, Affinity Relationship Director at Generation Mortgage. But this excitement has proven to be short-lived as the dramatic burst in business has yet to be realized.
After several conversations with professionals in all parts of the reverse mortgage industry, it is clear the problem with the unique reverse mortgage for purchase program is education. This education needs to take place on several levels, but the first is educating Realtors.
Derry Hampton, a reverse mortgage professional at Security 1 Lending and a licensed Realtor, pointed out just how little realtors know about the product.
“No one’s talking to Realtors about how this can fit into their business,” said Hampton, “I think really it’s up to the reverse mortgage industry to learn how to work with the real estate industry.”
A member of the National Association of Realtors (NAR) and the California Association of Realtors (CAR), Hampton added, “In California alone, there are 170,000 members of the CAR – that’s the new market for the reverse mortgage industry… what we need to do is teach them about this product.”