While 2024 was rife with challenges for the mortgage industry broadly — across forward and reverse — a new year brings a new mindset. Some challenges remain, with mortgage rates being chief among them. Education and distribution can also likely be improved. But there are also new opportunities for the industry in 2025, and the eternally optimistic reverse mortgage industry is more than ready to embrace them.
That was the general tenor of conversations with industry professionals at multiple companies, who shared their perspectives on the coming year with HousingWire’s Reverse Mortgage Daily (RMD).
Outreach to more forward mortgage players
The past couple of years have seen renewed efforts on the part of reverse mortgage companies to better connect with their counterparts in the traditional mortgage space. When rates began to rise, more forward companies appeared to embrace the potential of adding reverse mortgages to their overarching suites of products, and the reverse mortgage industry continues to see this as a solid opportunity in the new year.
“I think the opportunity, and what we started in 2023 and definitely continued in 2024 especially, is this distribution issue,” said Jim Cory, managing director of reverse mortgages at Guild Mortgage who was also recently elected co-chair of the National Reverse Mortgage Lenders Association (NRMLA).
“My role at NRMLA, for instance, is to work on different outreach to other organizations to build the distribution,” he added. “I see that as a big priority in 2025, as potentially the ‘year of the collab,’ if you want to call it that. I see more collaboration with different business units, for both the wider industry and within Guild, as well.”
Some of that was echoed by Steve Irwin, president of NRMLA, in a recent interview with RMD.
“There’s a lot of action and meetings happening with me and the co-chairs, Mike Kent and Jim Cory, about expanding our outreach to adjacent industries and relevant academic entities,” Irwin said. “Like think tanks and other associations related to aging issues, but also independent mortgage bankers, connecting with them, getting involved in their events, as well as real estate agents’ events and their educational content.”
Spreading the word continues to be a priority and NRMLA will continue to spearhead it, Irwin said.
“[We want to let them know] how a reverse mortgage works, and how adding reverse mortgages to a product portfolio is advantageous to them and to senior homeowners at large.”
Lisa Moriello, national retail reverse sales manager at loanDepot, said that this outreach was a bright spot in 2024 and fully expected both industry-wide and company-specific efforts to continue into the new year.
“The good news for 2024 for us was that we had a lot of forward loan officers realize that reverse mortgages are a great piece [to add to] their business, and a lot of people took the initiative to get certified,” she said. “And so we are working hard to get them educated, help them build business, get them out in their communities, so that we can introduce this piece into their markets.”
Digital processes and getting out of the ‘dark ages’
In a statement to RMD, Finance of America (FOA) president Kristen Sieffert spoke about the priorities the company is pursuing in the new year, stemming from identified opportunities.
“As we look ahead to 2025, our primary focus is on advancing digital innovation to deliver seamless experiences for our customers and modernizing our marketing strategy to overcome previous adoption barriers within our industry,” she said. “We believe that concentrating on these two areas is crucial in our mission to establish home equity as a mainstream retirement solution for retirees.”
Technology was also seen as a priority by Peter Sciandra, EVP of reverse lending secondary marketing at Fairway Independent Mortgage Corp.
“We’re looking at ways to reduce costs to the borrower, because we have always been looked at as having a bit of a high upfront cost,” he said. “So we want to try and address that a bit in the process itself. There may be ways to improve that, whether it’s changes in guidelines or changes in technology. We’re starting to focus on these things. And to me, that’s really exciting.”
Sciandra said that the industry still has some distance to cover when it comes to bringing the industry’s technology up to modern standards, but the opportunity to do so is being embraced.
“We’re still, unfortunately, in the dark ages in many respects as far as technology goes,” he said. “So we are looking at some things, working with some of the software vendors out there to maybe make some changes with how things are done.”
One year, the way to grow is getting in front of more referral sources. When we hit the third worst fiscal year for HECM endorsements since 9/30/2003, fiscal year 2023, the way to grow switched to bringing more forward players into the industry. And what will it be at the end of fiscal year 2025 when HECM endorsements are found to be one of the five worst fiscal years for HECM endorsements since 9/30/2003? (By the way, right now the fifth worst year for HECM endorsements since 9/30/2003 is fiscal year 2020 with 41,859. Notice no one suggested how or when the industry would break through these “worst of” years. Could they all be waiting for another great fiscal year for HECM Refis?)
With just about five months to gain more HECM CNAs (case number assignments) among which about 70% will convert into endorsements before 10/1/2025, how this fiscal year will be higher than the fourth worst such fiscal year seems more imagination than reality. There is still a strong possibility that HECM endorsements for the current fiscal year could end up being the worst such fiscal year since fiscal year 2003.
By this time tomorrow, we should know just how bad this first quarter of fiscal 2025 ended up and just how bad calendar year 2024 was for the industry as a whole. It does not seem that the kind of optimism seen in the article has done much to turn the endorsement counts around since 9/30/2018, other than by HECM Refis (or as some still call them HECM to HECM Refis) coming to the rescue in both fiscal years 2021 and 2022.
Despite all the rather loose speculation stated in the article, many things should be crystal clear by 1AM (EST). Be prepared for less than good news. Notice none of the interviewees is speculating on just when all of their predicted positive events will improve HECM endorsements.