The settlement funds have reached more than 620,000 homeowners, or roughly $81,000 per homeowner, the Department of Housing and Urban Development announced Tuesday based on research by the Office of Mortgage Settlement Oversight. 

“One year in, it is clear that this historic settlement is making a profound difference on lives and communities,” said HUD Secretary Shaun Donovan. “We have far surpassed expectations in our efforts to assist struggling Americans.”

Mortgage servicers named in the settlement spanned the five largest U.S. mortgage companies: Bank of America, J.P Morgan Chase, Wells Fargo, Ally Financial and Citigroup. Forty-nine state attorneys general and the federal government signed the agreement.

The settlement comes after months of evidence gathered with regard to servicers foreclosing on homeowners without going through the legal process of measures to help those mortgage holders refinance their loans or become current on payments in order to stay in their homes.

“Due to the efforts by 49 bipartisan state attorneys general and the federal government, hundreds of thousands of people are able to stay in their homes or avoid foreclosure, preventing the erosion of the social fabric of our communities,” Donovan said. 

Written by Elizabeth Ecker

That will include staff as well as the Greenlight brand, a company spokesman told RMD.

“Nationstar is excited about the acquisition,” said spokesman John Hoffmann following the acquisition announcement. “We are excited to have Greenlight joining including its reverse division and we are just as committed as always.”

Greenlight has been growing its reverse division, based in Irvine, California, since its launch in June 2011 under the leadership of former OMNI reverse mortgage execs.

The division had closed more than 217 reverse mortgages from January through April according to the latest report by Reverse Market Insight, marking a 90% increase over last year.

The operations will continue as a standalone, according to Nationstar, including branding and product labeling.

“We want them to keep doing the good work they’re doing. Their operation is something we’re very interested in,” said Hoffmann.

The deal specified a purchase price of up to $75 million in cash with the expectation of “sizable volume and profitability uplift” and additional annual volume of $8 billion-plus. The deal is accretive to earnings per share by at least $.70 annually, the company projected upon announcing earnings for the first quarter of $62.6 million or $.70 per share.

Written by Elizabeth Ecker

Last week, NewRetirement announced that Texas Tech’s Personal Financial Planning Department is among the providers of retirement planning knowledge through its social media platform. 

Dr. John Salter, who handles the relationship with NewRetirement for Texas Tech’s Personal Financial Planning Department, is currently researching the role of reverse mortgages in retirement distribution management and cash management.

A retirement calculator launched by NewRetirement in April gave consumers a glance at when their savings might run out, also gauging the appropriate time where a reverse mortgage might be best used to accommodate an individual’s finances. 

The collaboration between Texas Tech and NewRetirement, according to Salter, brings financial planning to everyone, especially to those that often have the least access and greatest need for such services. 

“We were very pleased to learn that NewRetirement has built a social media and technology platform capable of delivering financial planning knowledge to millions of Americans,” said Salter. “Combining our strengths magnifies the total benefit for all of these consumers.”

Coupled with NewRetirement’s retirement calculator, visitors to the company’s website can leverage the company’s social media platform to ask any question they wish of “highly skilled financial experts,” according to NewRetirement.

Consumers can post their questions anonymously and receive answers free of charge, either within the retirement calculator tool or by participating in an open Question & Answer forum.

If a visitor first receives a personalized analysis from the retirement calculator, a financial expert answering the question has the advantage of providing an answer that takes into account their unique financial situation.

These experts can then use this anonymous financial background information to provide a more detailed, accurate and customized response. 

“We are extremely pleased to be associated with Texas Tech’s Personal Financial Planning program,” said Steve Chen, NewRetirement’s CEO. “They are an excellent complement to the other financial experts and consumers that pitch in to answer question and help improve our website visitor’s retirement finances.”

Written by Jason Oliva

The announcement comes on the heels of state legislation having been approved by Texas’s House of Representatives that will put the Purchase reverse mortgage to a vote by the state’s population. The conference will cover ongoing legislative initiatives including state-specific issues that are top-of-mind for Texas reverse mortgage lenders. 

“With the lending landscape changing almost daily, those attending this conference will receive the most up-to-date information on everything from HECM for Purchase to Financial Assessment to secondary market updates,” said Scott Norman of Sente Mortgage in Austin, Texas.

The conference will take place September 10 with a welcome reception hosted by RMS on September 9. 

“As Texas is now the second largest state for reverse mortgages, we expect Reverse Mortgage Day to be attended by lenders throughout the country,” said Norman.

Find out more and register. 

Written by Elizabeth Ecker

The program aims to provide consultations that involve family members worried about their loved one’s decision to use the Home Equity Conversion Mortgage (HECM) program, and the impact the loan has on home ownership.

RMM is offering face-to-face consultations explaining the pros and cons of HECM loans, along with information on how to leverage the market for better results. Family members can also learn about how to properly use Medicare and Social Security benefits along with reverse mortgage proceeds to maximize financial outcomes for borrowers.

“Children are often involved with their parents’ home ownership and often assisted in their decision making,” says RMM. “By introducing a family consultation program for the potential HECM loan applicants as well as their children, RMM is ensuring that the decision is one that benefits the entire family.”

During the consultation, RMM goes through the entire reverse mortgage process and aims to make families aware of how their home equity would be impacted with a reverse mortgage, and which routes would give them the best benefits. 

“We are very excited for this program since addressing home ownership concerns with family members is among the most important things we do as Utah Reverse Mortgage brokers,” said Mark Schow, owner of RMM, in a statement. “Every child’s greatest fear is that someone takes advantage of them and they lose the most precious asset they have worked for their entire life: their home.” 

Written by Alyssa Gerace

Some lenders that have long utilized a phone-origination approach are adding originators in the field, and some others with experience largely based in branch offices are managing and growing call center operations for the first time. Where the balance lies depends largely on the lender, but those who have tested both models say the successful lenders will be able to offer all options to reverse mortgage borrowers in the future.

Maverick Funding, which has for several months hovered near the top-10 lender by volume list, currently has a slightly larger team of inside loan officers, but has recently added originators who will focus on being in the field.

“We are definitely looking to grow and expand on both tracks,” says Josh Shein, vice president/branch manager for Maverick Funding.

Even lenders that have a strong history of working with dozens of call center originators are beginning to “test the waters” on an approach that utilizes both sales models.

One Reverse Mortgage, for example, operates phone sales teams in offices both in Detroit where its parent Quicken Loans is based as well as in San Diego. The company is looking into the option of adding originators to the field for the first time. “We are a bit early into the process of investigating this model, but we feel it may be a nice complement to our web center” says One Reverse President Gregg Smith.

Different Approaches Net Different Results

In spite of the obvious differences that come with a face-to-face meeting versus a phone call origination process, the loans produced by each model can have some stark differences.

Associated Mortgage Bankers recently ramped up its call center operations and has quickly grown its reverse mortgage division to closing more than 300 so far this year.

While loans originated through its phone sales team tend to be greater in number, the company finds, the loan amounts, on average, are noticeably higher for the field-generated sales team.

“The outside sales force has been consistently contributing 25% of [our loan] units, but the loan sizes are larger,” says Kevin Blakeney, senior vice president of the company’s Reverse Mortgage Division.

AMB’s team spans a slightly larger group of field originators, whose leads are self-sourced and often come from relationships with financial planners and builders. Those originators average between one and two loans per month, Blakeney says, with the call center employees averaging around five loans per month in comparison.

This edition of the RMD Report is sponsored by national appraisal management company Landmark Network.  

Written by Elizabeth Ecker

CFPB ordered Texas homebuilder Paul Taylor to pay the more than $100,000 he received in kickbacks for referring mortgage origination business to Benchmark Bank and to Willow Bend Mortgage Company.

Through partnerships with Benchmark Bank and Willow Bend Mortgage Company, Taylor created and jointly owned Stratford Mortgage Services, LC, which claimed to be a mortgage originator, according to the CFPB. Similarly, Taylor and Willow Bend created and jointly owned PTH Mortgage Company.

It was through each of these created entities that the CFPB noted as “shams designed to allow Taylor to receive the kickbacks.”

Taylor’s homebuilding company, Paul Taylor Homes, then referred mortgage origination business to the “sham entities,” according to the CFPB, however, the work was actually performed by Benchmark Bank and Willow Bend.

The kickbacks were then passed through the sham entities back to Taylor through profit distributions and as a payment through a “service agreement.”

The settlement resolves violations of the Real Estate Settlement Procedures Act (RESPA), which prohibits giving and receiving kickbacks for services involving federally related mortgages. 

Under the settlement’s terms, Taylor has agreed to pay $118,194.20—the full amount of money he received since early 2010 from the kickbacks schemes, notes CFPB.

The CFPB became aware of Taylor’s conduct related to Benchmark Bank and Stratford through a referral from the Federal Deposit Insurance Corporation (FDIC). 

FDIC separately fined Benchmark Bank for its role in the RESPA violations.  

“Kickbacks harm consumers by hampering fair market competition and by unnecessarily increasing the costs of getting a mortgage,” said CFPB Director Richard Cordray. “The CFPB will continue to take action against schemes designed to let service providers profit through unscrupulous and illegal business practices.”

The Bureau is also prohibiting Taylor from engaging in future real estate settlement services, including mortgage origination.

“The Bureau will continue to enforce RESPA’s anti-kickback provisions to protect consumers and deter individuals from engaging in illegal activity,” said CFPB in a statement.

Written by Jason Oliva

NRMLA held its West Coast regional conference. Outpacing last year’s attendance, the NRMLA conference in Irvine, California drew 260 professionals from across the nation to talk reverse mortgage topics including working with financial planners, private equity investments, the CFPB and more. 

During the conference … NRMLA proposed a borrower assessment financial assessment to HUD. The assessment would identify certain “high risk” borrowers who would have to meet certain criteria or undergo additional requirements before getting a reverse mortgage. 

Reverse mortgages took center stage before Congress Thursday. In a hearing before a House Financial Services subcommittee, members of Congress pressed HUD Deputy Assistant Secretary Charles Coulter on why and how HUD will implement the reverse mortgage change it is seeking. 

Liberty Reverse announced a new financial planning partnership. Through a partnership with Texas Tech University, Liberty is sponsoring a new research study on the use of reverse mortgages as a retirement planning tool. 

… and in hiring news, ReverseVision announced the hire of industry veteran Fresco Ellis as a customer support specialist based in ReverseVision’s new San Diego office. Fresco brings more than 10 years of mortgage lending experience, including roles at One Reverse and Generation Mortgage.

Written by Elizabeth Ecker