Reverse Mortgages

[midwestbroker]

I know that we have touched on this in the past, but I was wanting to know if anyone since then has done anything with them.

I decided to start offering them to my clients. I went with WSB Mortgage. They make you a W-2 employee.

I am marketing it as a "oh, by the way" product when I am done with my Medicare Advantage presentation / sale. I have a flier that I leave behind with some life insurance options and a brief paragraph about reverse mortgages.

I figure if I close a few here and there it may be worth my time.

 

[Mr. Bill]

All I can tell you is keep your E&O current. RMs are overutilized and I think people still don't really understand the impact. You'll be on the losing end if there are any heirs out there....

 

[lifesettlementadvisor]

RMs are best for low net worth clients. Have you thought about adding a paragraph on your fliers about life settlements also (for your high net worth clietnts)?

 

[Estreetloans]

Reverse Mortgages are big news right now with the mortgage industry in shambles. They are a great fit for the right client. There are no credit checks and the only criteria really is to be over 62 and have equity in the home. Seniors have the depression era mentality and most won't even think about dipping into the equity they have worked so hard to establish, even though many have no other form of retirement savings. Reverse mortgages are often a very tough sell.

You need to be careful when suggesting these because many times there are hidden costs or fees associated with them. Even more often, the equity in the home is eaten up at a more rapid pace than expected.

Mr. Bill, why would there be trouble if there were heirs? Curious. Thanks

 

[Mr. Bill]

Melissa, the answer to your question lies in paragraph 2 of your post. Simple enough.

 

[midwestbroker]

The quote that you give the client has all the fees on it. There is a big expense to get them started, nothing out of pocket but goes against the equity in the home.

I am not worried about E&O since this is not an insurance based product and I am W2 with the broker.

The reason that I have started with it is because clients have asked me about them. There is a mortgage firm here in KC that advertises all the time about them.

Am I going to push them? No. Just mention it on my flier. I would rather sell some final expense or single premium life, but if they were going to get a reverse mortgage, why not buy through me?

 

[midwestbroker]

P.S.

That is the thing about having a product like this. It is not my primary product, nor is it my secondary. It is more of just an offering here and there. If I do not sell one I am not out anything. If it is bad fit, I can be really honest as I am not counting on any commission from those sales. They are more like mad money commissions. If I sell a few great, if not, no food off the table.

 

[retread]

If you think about it for a minute, it is a great deal for someone with no heirs.... why leave a home to the bank, or the probate court? If you have no one to leave it to, then spend it down before you check out.

Here is where the basis of the comment stems from in the former post... if there are heirs, they may be counting on getting their hands on the property (equity).

There are those who wish to leave an inheritance, but need to consider whether they must live in poverty to do so, in which case I would recommend they use every asset they have to sustain themselves. Their heirs should be able to take care of themselves. It is sad to see grandparents live at poverty levels and give to children who spend gifts with little thought, like it was water. They (the younger generation) never had to cross a desert (analogy to the depression) so they don't appreciate having water until the well runs dry.