The Road Leading to the HECM Reverse Mortgage is Getting Congested

                                                                    

M Scott Peck, in his seminal book, The Road Less Traveled, began the book with this succinct aphorism:  “Life is difficult”.

I think that we all lament to a degree that we are not born with a life guide, or a road map that tells us how to do things. Often we are not prepared for the sudden twists and turns that confronts us. There is no instruction manual that tells us what steps to take and what steps to avoid. So we go about our way, often using trial and error, as our guideposts.  

On the other hand, each of us experiences constant voices of the “I know what is best for you” variety. The advice-giver may not be able to handle the rabid issues that shape their lives, yet, as night follows day, unwelcomed and unsolicited sophomoric  answers will be served up  as incontestable and irrefutable wisdom.

Older Americans, having experienced the vagaries of life’s menu from Column A and Column B ,are especially prone to receiving unsolicited advice. This advice comes from different directions. For example, it can come from the media; from family; from friends; from the pandering politician who sometimes believes that the job description is about getting re-elected. Along the way, doing one’s job  becomes less important.

If we could, for a moment , view reverse mortgages as a path that leads to a destination where some of life’s stresses are removed,  one would have to note that the road less traveled is beginning to get a bit congested.

Today, the financial stresses facing our elders have already cast a deep pall over their lives. The unpaid  bills keep growing, while the available cash keeps diminishing. Only the government has the ability to print money. Senior homeowners do not. Yet they do have access to a program that permits them to convert home equity into cash.

So here is the fundamental question. If certain senior homeowners have the ability to do this, why has the  nascent congestion not turned into a stampede?  I believe that there are a number of reasons that need to be considered.

While I have seen more and more families collectively agree that a reverse mortgage is appropriate and the only thing that will solve the particular money issues, this  growing trend is now reversing. The economic miasma has once again caused more adult children to believe that the home is their entitlement.  Sadly, their self interest, blinds them to the reality of the parents’ financial situation.

I have seen friends, out of ignorance, provide incorrect guidance, as many of the indelible misconceptions are repeated. I have also experienced friends who know better, dissuade  their friend from getting one because the advice giver couldn’t get one. Jealously can easily cause a friend to rain on another’s parade.

I have come to believe that some in the media are no longer in the reporting business. Or if they are, the editors get in the way. Unyielding competition has caused sensational, attention getting headlines and stories to turn negative. Negative sells. Nice, touchy feely stories do not. By disposition, reverse mortgages are  of the latter type.  So you want to sell… so you want to be noticed  then make touchy, feely into NEGATIVE.

Then there is the demagoguery of some of the politicians. Like some of the media, they the politician enhance their worth, only if they can show their constituents that they are being protected from evil.  The industry has already identified some of these perpetrators.  And on it goes.

In spite of the challenges to this industry, it clearly is one of the few that protect older American homeowners from the current economic calamity. There are wonderful voices that articulate a clear need for the reverse mortgage program.  It appears that even the incessant voice  of Peter Bell and the dedicated staff of NRMLA, and the voices of other industry leaders are summarily dismissed by  some who have a different agenda. 

Deciding whether a reverse mortgage is appropriate is not difficult. There are many very competent industry people waiting to help. Your job is to hire the right individual. If you take your time, ask lots of questions, and choose wisely you road map will put you on a smooth path. Only you have the power to determine which road to follow. 

Comments

[Beth Paterson]

Great analogy, Dennis! It's sad that so many believe those who are perceived as having a senior's best interest in mind, however, they really have their own interests at the forefront.

I tell my borrowers that they need to get educated from one that is experience in the industry then they can make the decision. Not to believe the neighbor, media or politicians who really do not know the facts of reveres mortgages. You are so right, there are many competent people to help. We don't go to the plumber for our health issues so why listen to the media, politician, neighbor, or anyone else who doesn't specialize in reverse mortgages. Once seniors have the facts, work with one who specializes in reverse mortgages, has years of experience and expertise in reverse mortgages, can provide references and get the answers to the many questions they should be asking, their their path will go smoothly and they will be happy with the road they have chosen. This is the case with my borrowers, as well as yours and so many of the other reverse mortgage borrowers.