With thousands of NRMLA by liaoqinmei


									Reverse Mortgage
                                                                                                                                                                            VOLUME 6.1, WINTER 2003

                                                                                             A D V I S O R   NRMLA Conference Set for
                                                                                                             April in Miami Beach

                                                                                                                      74% increase in reverse mortgage volume this past year is sparking
                                                                                                                      increased inquiries from mortgage lenders and brokers about how
                                                                                                                      the program works and how it can benefit them.

                                                                                                                 In response, NRMLA has scheduled a Reverse Mortgage Educational
                                                                                                             Forum for April 8-9 in Miami Beach, FL. A similar forum is expected this
                                                                                                             summer in Denver.
                                                                                                                 “As the refi boom winds down and lenders and brokers look for additional
                                                                                                             products to offer, the reverse mortgage is a perfect candidate,” says NRMLA
                                                                                                             President Peter Bell. “The surge in volume attests to the growing popularity
                                                                                                             of this product with consumers, and our Educational Forum offers loan origi-
                                                                                                             nators the opportunity to find out both how they can get into this business

                                                                                                                                                                         MIAMI CONFERENCE, continued on page 10
              A quarterly publication of the National Reverse Mortgage Lenders Association

                                                                                                             NRMLA Seeks Designation of
                                                                                                             Home Modification Week as Way
                                                                                                             to Promote Reverse Mortgages

                                                                                                                      RMLA has formed a coalition with several interested organiza-
                                                                                                                      tions to develop a strategy to increase public awareness regarding
                                                                                                                      the need to increase home safety and accessibility for seniors as
                                                                                                             they continue to age. This effort is
                                                                                                             part of our current ongoing con-                 INSIDE THIS ISSUE
                                                                                                             sumer awareness and national
                                                                                                             media campaign.                              Charles and Joan Henning
                                                                                                                 One of the working group’s goals         Profile .........................................2
                                                                                                             is to designate November 9-15 as
                                                                                                                                                          NRMLA News .............................2
                                                                                                             “National Home Modification
                                                                                                             Week.” A request for a Presidential          Herbert and Barbara Hoffman
                                                                                                             Proclamation of this event has been          Profile .........................................3
                                                                                                             submitted to The White House.
                                                                                                                                                          Steps to Get Your HECM
                                                                                                                 By seeking recognition of
                                                                                                                                                          Loan Limit Increased .................3
                                                                                                             National Home Modification Week,
                                                                                                             NRMLA hopes to empower older                 NRMLA Legislative Campaign ....4
                                                                                                             Americans to think about the physi-
                                                                                                             cal modifications they can make to           Miami Educational Forum
                                                                                                                                                                    Registration Form ....................11

                                                                                                                HOME MODIFICATION WEEK,   continued on page 9
          BORROWER PROFILE                                                 NRMLA News
                                                                           FHA ELIMINATES PUD APPROVAL PROCESS
                                                                               Effective immediately, the Federal Housing
                                                                           Administration will no longer require prior approval
                                                                           of planned unit developments as a precondition for
                                                                           insuring mortgages, including Home Equity
                                                                           Conversion Mortgages, on homes in that PUD.
                                                                               The new policy took effect upon the release of
                                                                           Mortgagee Letter 2003-02 on Friday, January 24.
                                                                           Although the PUD approval process has been elimi-
                                                                           nated, lenders will still be required to attach the
                                                                           existing PUD Rider currently found in Section XI of
                                                                           Handbook 4165.1 to all mortgages made on proper-
Charles and Joan Henning attending an exchange student’s wedding.
                                                                           ties located in PUDs. Typically, an appraiser can
                                                                           identify whether a senior’s home is located in a PUD.
Charles and Joan Henning                                                       A development is categorized as a PUD if:
                                                                                     A homeowners’ association owns title to, or
                                                                                     leases, common areas/facilities on the

        harles and Joan Henning, aged 79 and 77,
                                                                                     property (e.g., pool);
        respectively, have 26 miniature flags in their
        downstairs living room. Each represents the                                                                 NRMLA NEWS, continued on page 6
country of a foreign exchange student they have
   “When our two daughters got married and moved                           The National Reverse Mortgage Lenders
away, we volunteered to be a host family in an inter-                      Association is a national trade association that
national exchange program,” said Joan. “We love to                         provides education, advocacy, and referral ser-
do fun things and to hang out with young people. It’s                      vices to firms that are involved in the reverse
been such a rewarding experience...The students we                         mortgage industry.
have hosted over the years have become our extend-                                                      Co-Chairs
                                                                                                    Jim Mahoney
ed family.”                                                                              FINANCIAL FREEDOM SENIOR FUNDING CORP.
   The exchange program enables youths to travel to                                                     IRVINE, CA

the U.S. to attend one year of high school, or to                                                    Sarah Fiske
                                                                                              SEATTLE MORTGAGE COMPANY
enroll as a graduate or undergraduate student at the                                                  SEATTLE, WA
University of Notre Dame in nearby South Bend.
   “Some students stayed with us while they were                                                      Peter Bell
                                                                                             DWORBELL, INC., WASHINGTON, DC
here and others we met at various functions spon-
sored through the exchange program,” according to                                              Director of Communications
                                                                                                  Glenn Petherick
Joan, who taught French, Journalism, and Drama at
the local middle school for 17 years.                                                            Reverse Mortgage Advisor

   Although the Hennings are no longer a host fami-                                                      Editor:
                                                                                                     Darryl Hicks

                                    HENNING PROFILE, continued on page 6                                 Office

                                                                                  1625 Massachusetts Avenue, NW, Suite 601
  A reverse mortgage is a unique loan that enables senior                                Washington, DC 20036-2244
                                                                                    Tel: 202-939-1760, Fax: 202-265-4435
  homeowners (62+) to convert part of the equity in their                         Web site: http://www.reversemortgage.org
  homes into tax-free income without having to sell the home,
  give up title, or take on a new monthly mortgage payment.                Reverse Mortgage Advisor is published quarterly as an information
                                                                            service for NRMLA members. The subscription price is included
                                                                                                in membership dues.

 2                                                                                         Reverse Mortgage Advisor               Winter 2003
NRMLA BOARD OF DIRECTORS                                               BORROWER PROFILE

             Jim Mahoney
                                                      Herbert and Barbara Hoffman
  Financial Freedom Senior Funding Corp.              P O U LT N E Y, V T
                 Irvine, CA

              Sarah Fiske
        Seattle Mortgage Company
                                                      H     erbert and Barbara Hoffman, aged 85 and 73, respectively, have
                                                            lived in their turn-of-the-century farmhouse for over 25 years.
                                                          “It’s such a lovely home and we have about five acres of land,” said
                Seattle, WA
                                                      Barbara. “We’re located about a quarter mile off the main road, so it’s
           Dennis Pigg, Sr.
                                                      nice and private.”
          Safeway Mortgage, Inc.                          Unfortunately, Herbert suffers from Parkinson’s Disease, which pro-
               Smyrna, GA
                                                      gressively made it difficult for him to walk up the steep stairs to his
             Robert Wyatt                             second-floor bedroom and bath.
       First National Bank of Florida
                                                          Because they loved their home – “selling it was the last thing we
                Sarasota, FL                          wanted to do,” said Barbara – the couple decided to get a reverse mort-
                                                      gage so that they could modify the first floor to meet Herb’s needs. In
            Mary Ressetar
                SECRETARY                             the spring of 2002 they obtained a $71,000 FHA Home Equity
       Alliance Mortgage Company
             Schaumburg, IL
                                                      Conversion Mortgage from Wells Fargo Home Mortgage, Inc. The cou-
                                                      ple took an initial draw of $20,000 to fund the home modifications, and
                                                      the balance in monthly payments for life.
             Megan Akers
                 Bay Docs                                 “We added an addition onto the back of the home,” added Barbara.
                Novato, CA                            “We converted our small den into a larger bedroom for Herb and I and
            William Agner
                                                      then we added a nice sized sun room as well.”
    Honeowners Mortgage Service, Inc.                     Other minor ground floor alterations were made to make it easier
              Carmel, IN
                                                      for Herb to move through the couple’s house. “He gets along pretty well
           Carol Bouchner                             despite the Parkinson’s,” said Barbara, “but if we hadn’t gotten the
       GE Mortgage Insurance Corp.
                                                      reverse mortgage we eventually would have had to sell the home and
               Raleigh, NC
                                                      move into another place.”
           Steve Bradshaw                                 Noted Barbara: “We didn’t want to move because after you’ve lived
      Standard Mortgage Corporation
             New Orleans, LA                          in a place for as long as we have here, you’ve arranged things a certain
                                                      way and you become a part of the surroundings. Getting the reverse
             Paul Franklin
          Franklin Funding, Inc.
                                                      mortgage was one of the best things we ever did.” RMA
             Charleston, SC

        Patrick J. McEnerney
       Alliance Mortgage Company
              Jacksonville, FL                        Steps You Can Take To Get Your
               Dan Ryan
      Farwest Mortgage Bankers, Inc.
                                                      Area’s HECM Loan Limit Increased
              Placentia, CA

                                                             ach year, the U.S. Department of Housing and Urban

           Jeffrey S. Taylor
                                                             Development adjusts for inflation the county loan limits for fed-
     Wells Fargo Home Mortgage, Inc.                         erally insured single-family mortgages, including the Home
             Greensboro, NC
                                                      Equity Conversion Mortgage (HECM).
                EX-OFFICIO                               The new FHA loan limits are modified in accordance with the new
             Peter H. Bell                            Fannie Mae/Freddie Mac single-family loan limits. HUD’s four regional
              Dworbell, Inc.                          Homeownership Centers (HOC) – in Philadelphia, Atlanta, Denver, and
             Washington, DC
                                                      Santa Ana, CA – adjust the loan limits for the counties within their

                                                                                                       HECM LIMITS, continued on page 8

Reverse Mortgage Advisor                Winter 2003                                                                                 3
NRMLA Begins Renewed                                           Mae/Freddie Mac conforming loan limit ($280,749 in
                                                               2003). The loan limit would be adjusted upwards for
Push for Single National Loan                                  Alaska, Hawaii, and the U.S. Virgin Islands.
Limit for HECMs; How You
Can Be Part of Our Grass                                       GRASS ROOTS CAMPAIGN
                                                                  Getting a new bill introduced and passed won’t
Roots Campaign
                                                               be easy.
                                                                  NRMLA’s two key supporters in the U.S. House of

         ongress adjourned in December without
                                                               Representatives – Reps. John LaFalce (D-NY) and
         approving legislation – endorsed by NRMLA –
                                                               Marge Roukema (R-NJ) – have retired. This means
         that that would have created a single nation-
                                                               that NRMLA must cultivate new relationships on
al loan limit for the FHA Home Equity Conversion
                                                               Capitol Hill.
Mortgage program.
                                                                  That’s a monumental task considering there are
     What this means is that NRMLA will now resume
                                                               100 Senators and 435 U.S. Representatives. NRMLA
its legislative campaign for a single national loan limit
                                                                              needs its members to participate in this
for HECMs in the new 108th Congress,
                                                                              legislative campaign.
which convened on January 6.
                                                                                  Over the next several months,
                                                         NRMLA IS             NRMLA will organize a grass roots
                                                                              campaign to mobilize the Association’s
     Because housing costs vary from
                                                     RESUMING ITS             members to educate members of
one county to the next, Congress estab-
                                                                              Congress about the critical role reverse
lished single-family loan limits for FHA
                                                      LEGISLATIVE             mortgages play in helping seniors
that differ according to the median
                                                                              enhance their lives.
home price in each market. The highest
                                                    CAMPAIGN FOR A
of the loan limits – applicable generally
to metropolitan areas – increased to
                                                                              WHY PERSONAL CONTACT IS IMPORTANT
                                                   SINGLE NATIONAL                While NRMLA represents the views
$280,749 for 2003, from $261,609 in
                                                                              of the reverse mortgage industry before
2002. The lowest loan ceiling, or “floor,”          LOAN LIMIT FOR            Congress and the federal government,
which generally applies to rural and
                                                                              lawmakers are usually most impressed
non-metropolitan areas, rose to                   HECMS IN THE NEW
                                                                              by contact and arguments from their
$154,896 in 2003, from $144,336 in
                                                                              constituents – you. They also respond
2002. The loan limit is 50 percent                 108TH CONGRESS,
                                                                              better on an issue if they can associate it
higher for Alaska, Hawaii, and the U.S.
                                                                              with a name and face from “back
Virgin Islands.                                    WHICH CONVENED
                                                                              home.” This is why it’s critical for you to
     The disparities in the FHA loan limits
                                                     ON JANUARY 6.            get involved to educate your Senators
mean a senior homeowner in a city with
                                                                              and Representative about reverse mort-
a low FHA loan limit can’t access as
                                                                              gages so that they can be convinced to
much of his or her home equity as a
                                                                              take action to help our cause.
senior in a city with a high FHA limit, regardless
                                                                  If you’re like most people, you’ve never contacted
of their relative need for the funds. NRMLA feels
                                                               your Senators or Representative – or perhaps only
this unfairly penalizes senior homeowners in low-
                                                               when you’ve been mad about something. Actually, it
cost areas.
                                                               can be an educational and enjoyable experience.
     In addition, the variance in loan limits is confus-
                                                                  Your lawmakers will be more likely to listen to you
ing to seniors. It also makes it difficult for lenders to
                                                               when a critical issue arises if they already know who
nationally market HECMs and create standard mate-
                                                               you are, understand your business, trust you, and feel
rials to tell homeowners the size of a HECM they
                                                               you and your business are important to them.
might get. For these reasons, NRMLA would like
                                                                  Following are some steps you can take to estab-
Congress to establish a single, nationwide loan limit
for FHA HECMs equal to 87% of the Fannie
                                                                                       LEGISLATIVE CAMPAIGN, continued on page 5

 4                                                                            Reverse Mortgage Advisor         Winter 2003
LEGISLATIVE CAMPAIGN, continued from page 4

lish this kind of positive working relationship with       significant community involvement that depicts your
your Members of Congress.                                  firm as a “good citizen,” share this information at the
                                                           meeting and be prepared to discuss it. It’s a good
KEY STEPS TO ESTABLISH YOUR RELATIONSHIP WITH              idea to memorize the key points you will want to
YOUR SENATORS AND REPRESENTATIVE                           make in your meeting. These include:
    Identify your Senators and Representative and
request a meeting at home. Members of Congress                     Who you are and why your business is good
(from now on referred to as Member) tend to be more                for your community and the nation.
relaxed and attentive when they meet with con-
                                                                   What issues are important to you this year
stituents in their home district. To find out the names
                                                                   and why.
of your two Senators and your U.S. Representative,
and to locate their Washington, DC and district offices,
                                                                   You want to work with the Member and
visit one of the following Web sites (www.house.gov,
                                                                   his/her staff, and are available to help.
www.senate.gov, www.congress.org) or check your
telephone directory. Write an introductory letter
                                                           Have your meeting. You will probably have just 10-
addressed to the Member. Explain who you are, the
                                                           15 minutes for this first meeting – that’s all you should
issues important to you, and request a meeting.
                                                           need. Stick to your main points. Emphasize the per-
    Include in your letter specific information about
                                                           sonal introduction to you and your business, then
your company, your annual loan volume, and the
                                                           briefly discuss your issues. Let the Member or staff
number of people you employ in the Member’s dis-
                                                           person ask questions. If you don’t know an answer,
trict or state. Follow up your letter within one week
                                                           say you will get back with the answer soon. Don’t
with a phone call to the Member’s appointments sec-
                                                           argue with the Member or staff person, even if they
retary or scheduler. Explain who you are, that you
                                                           seem inclined to do so. If they don’t agree with you or
have sent a letter, and request a meeting as soon as
                                                           seem indifferent to your points, ask to leave them
possible. You may be told the Member isn’t available,
                                                           some information and offer further assistance.
but that a staff person can meet with you. Meeting
                                                               If the Member or staff person asks specifically
with the Member directly is very important, but if
                                                           what you would like them to do for you, tell them you
they aren’t available for several weeks, you should
                                                           want their support for a single national loan limit for
arrange an immediate meeting with the top staff
                                                           HECMs and other NRMLA-sponsored initiatives. Ask
person in the office. Then, at that meeting, you can
                                                           for the name of the staff person in the Member’s
request a subsequent meeting with the Member.
                                                           Washington, DC office who handles banking and/or
                                                           housing issues, and write this name down. At the con-
Prepare for your meeting. Think about how to
                                                           clusion of the meeting, leave your business card with
explain your business in a few sentences that will be
                                                           the Member or staff person, along with your compa-
easily understood. Remember: Most people aren’t
                                                           ny’s brochure any other materials you think will leave
familiar with reverse mortgages, and this may be
                                                           a positive impression of you and your business.
the first time the Member or staff person has heard
the term. Come prepared with some positive exam-
                                                           Send a follow-up letter. Immediately after your
ples of what you do that helps seniors and helps the
                                                           meeting, send a follow-up letter thanking the
economy in your area (i.e., reverse mortgage loans
                                                           Member or staff person for the meeting and review-
have helped seniors eliminate debts, pay for home
                                                           ing the main points that you discussed. If there were
health care, etc.). If your company has numerous
                                                           any questions asked during the meeting that you
employees in the Member’s district or state (even if
                                                           were unable to answer, provide the answers in this
only a few work on reverse mortgages), provide
                                                           letter. (NRMLA’s staff can help get this information to
specific numbers. Members are always interested in
                                                           you quickly.)
issues that affect major employers. If you have some
                                                                                 LEGISLATIVE CAMPAIGN, continued on page 12

 Reverse Mortgage Advisor      Winter 2003                                                                              5
HOFFMAN PROFILE, continued from page 2                        NRMLA NEWS, continued from page 2

ly, they’ve kept in close contact with many of their                  Membership in the homeowners’ association
former exchange students.                                             is mandatory;
     Three of them – Christine from France, Gabrielle
                                                                      Residents vote on the operation of the
from Mexico, and Carlos from Brazil – got married in
                                                                      association; and
2002. The Hennings were invited to attend all three
weddings, which were held in their friends’ native                    A membership fee, or other special
countries.                                                            assessment, is charged to each resident.
     To raise money to attend the weddings, Charles
and Joan decided to get a reverse mortgage from                   Previously, a borrower could not qualify for a
Seniors Equity Income, Inc., based in Granger, IN.            HECM if they lived in a PUD that was not FHA
     “We got the reverse                                      approved. Getting approval could be costly and timely.
mortgage, so that we                                          Seniors living in a retirement, or gated community –
could go to France and          TO RAISE MONEY                common in states like Florida, Arizona, Pennsylvania,
Brazil,” explained               TO ATTEND THE                and California, which have large senior populations –
Joan. “Later we were                                          will be impacted most by the new policy.
                              WEDDINGS, CHARLES
invited to Gabrielle’s
                               AND JOAN DECIDED
wedding in Mexico.                                            GUIDE ORDERS KEEP POURING IN
                               TO GET A REVERSE                   During the first two weeks of February 2003,
Getting the reverse
mortgage was a smart            MORTGAGE FROM                 NRMLA distributed 878 copies of our free consumer
move, because we                 SENIORS EQUITY               guide – Just the FAQs: Frequently Asked Questions
didn’t have to dip into        INCOME, INC., BASED            About Reverse Mortgages – to persons who called/
our savings.”                     IN GRANGER, IN.             e-mailed us to request information on reverse
    The Hennings’ four                                        mortgages. A year ago in February, there were 424
bedroom, “ranch-style”                                        requests.
home – where they’ve lived for 50 years – was                     The likely reason for the heavy increase is the
appraised at $100,000. They obtained a $54,847                additional, positive news coverage we’ve generated
reverse mortgage, after payment of closing costs. The         through NRMLA’s consumer education campaign,
loan closed on February 25, 2002. The couple took             which reaches out to reporters and editors nationwide.
out an initial draw of $8,000 to pay for the first two             NRMLA members have also found the guide to
trips, and left the balance in a line of credit.              be a useful resource for their senior clients because
    “You know how the Chinese have a Year of the Dog          it provides helpful, easy-to-understand information
or some other animal,” laughed Joan. “Well, in 2002, it       about the loan application process for reverse mort-
was the Year of the Weddings for the Hennings. We             gages; fees and interest charges; how much is owed
traveled a lot, but it was so much fun traveling to           when the reverse mortgage comes due; and con-
Paris, and Brasilia [the capital of Brazil] and Saltillo in   sumer safeguards.
Mexico. We were treated like honored guests.”                     To order copies of NRMLA’s consumer guide for
    In addition to paying for their travel, the Hennings      your clients, contact Laura Hampton, 202-939-1788,
also used funds from their reverse mortgage to buy a          lhampton@dworbell.com.
computer. The computer, Joan said, “opened up a
whole new world for us.” The couple now uses e-mail           TEXAS GROUP SEEKING CONSTITUTIONAL AMENDMENT
to keep in touch with their children and other friends.           Legislation (SJR 7 and HJR 23) has been intro-
    “I used the Internet to purchase our plane tickets,       duced in Texas that would allow senior homeowners
reserve hotel rooms, and make other travel arrange-           to refinance or pay off a home equity loan with the
ments,” she noted. “I doubt we could have done any            proceeds of a reverse mortgage.
of this without our reverse mortgage, which is why                Sponsored by Sen. John Carona (R-Dallas) and
we’re advising our friends to get one, too.” RMA
                                                                                            NRMLA NEWS, continued on page 7

 6                                                                         Reverse Mortgage Advisor       Winter 2003
NRMLA NEWS, continued from page 6

Rep. Scott Hochberg (D-Houston), the legislation        closer look at the product because of the nation’s
addresses problems with current provisions in the       “inadequate” social security system.
Texas Constitution that prohibit the refinancing of a       “Reverse mortgages should be encouraged in the
home equity loan with anything other than another       country,” said V Raghunathan, President of Vysya
home equity loan.                                       Bank, one of India’s largest.
    Because the proposal would amend the state’s            According to the article, seniors in India
constitution, the legislation must pass the Texas       receive very little, if any, financial assistance from
legislature by a two-thirds vote and be ratified by a   the government after retirement. This is why reverse
majority of Texas voters in a ballot referendum – in    mortgages are being scrutinized more closely by
November 2003 at the earliest.                          lending institutions. Bank executives quoted by
    Scott Norman, executive director of the Texas       The Times of of India said that it is “high-time” the
Reverse Mortgage Lenders Association, is “fairly        concept of reverse mortgages is brought to India,
confident” both bills will be approved by the           especially since real estate is showing “healthy”
required two-thirds majority.                           signs of recovery.
    As for other hopes to amend the constitution to
allow reverse mortgages to be taken out as a line       REVERSE MORTGAGES COVERED ON CNN,
of credit, which is currently prohibited in Texas,      NEWSPAPERS, ELSEWHERE
Norman added there still appears to be stiff opposi-        News media coverage of reverse mortgages con-
tion to this change. “That’s going to be a tougher      tinued to flourish in the past month, with television,
sell,” he noted.                                        newspaper, and magazine stories.
    To learn more about the current draft legislation       NRMLA President Peter Bell was interviewed
and issue, contact Norman at 512-306-9809 or via        about reverse mortgages on February 10 by
email at snorman@austin.rr.com.                         Kathleen Hays on national cable channel CNN-FN
                                                        (Financial News), on the “Money and Markets”
FHA HECM PRODUCTION REMAINS BRISK                       news segment.
    Four months into the new federal fiscal year (FY        Earlier, on February 5, Shelley Giordano of Wells
2003), which began October 1, originations of FHA       Fargo Home Mortgage spoke about reverse mort-
Home Equity Conversion Mortgages show no signs          gages on CNN-FN’s “Your Money” program. Before
of slowing from their robust pace.                      that, Wells Fargo’s Jeff Taylor was interviewed about
    According to U.S. Department of Housing and         reverse mortgages for a story on CNN Headline News
Urban Development data, FHA endorsed 4,948              that featured some borrowers and ran nationwide.
HECMs for insurance during October-January 2003,            Local television stations also covered the topic of
compared to 3,615 in the same three-month period        reverse mortgages, including a news story on
a year earlier.                                         February 2 on WCBS-TV in New York City, and a news
    On a monthly basis, FHA endorsed 1,359 HECMs        story on January 23 on WGN-TV in Chicago. The latter
for insurance in January compared to 1,218 in           station is seen in many areas of the country on local
December 2002.                                          cable TV networks. (To view some of the recent TV
    To view HUD’s monthly HECM volume reports, go       stories, go to http://www.reversemortgage.org.)
to the Members’ Only section of NRMLA’s Web site.           In addition to television coverage, articles about
                                                        reverse mortgages also appeared recently in a num-
REVERSE MORTGAGES IN INDIA?                             ber of newspapers, among them the Boston Globe
    Although reverse mortgages aren’t offered in        and Boston Herald, Tampa (FL) Tribune, Baltimore
India yet, a recent news article on the Web site of     Sun, Richmond Times-Dispatch, and Hartford Courant.
The Times of India newspaper indicates some finan-      Magazine articles on reverse mortgages also ran in
cial service executives in that country are taking a    the February issues of U.S. Banker magazine and

                                                                                     NRMLA NEWS, continued on page 8

 Reverse Mortgage Advisor     Winter 2003                                                                        7
HECM LIMITS, continued from page 3

jurisdiction.                                            get more out of their HECM.”
    The new higher limits for HECMs and other                For this reason, NRMLA in the new 108th
FHA single-family mortgage programs took effect          Congress will be resuming its push for a change in
January 1, 2003, and were implemented in HUD             the law to create a single national loan limit for the
Mortgagee Letter 2002-27.                                FHA HECM program. (See p. 4 for story on NRMLA’s
    The HECM loan limit varies by geographic area.       legislative priorities.)
The very top limit – applicable generally to metropol-
itan areas – increased to $280,749 in 2003, from         PROCEDURES FOR GETTING LIMITS INCREASED
$261,609 in 2002. The lowest ceiling, or “floor,”            In the meantime, there is a strategy that lenders
generally applicable to rural and non-metropolitan       can use to try to get their county loan limit increased
areas, rose to $154,896 in 2003, from $144,336 in        to a more reasonable level.
2002. The loan limit is 50 percent higher for Alaska,        A HUD official in Washington, DC, interviewed
Hawaii, and the U.S. Virgin Islands.                     by the Reverse Mortgage Advisor, advises lenders to
    According to figures compiled by Jerry Wagner,       compile data, measuring home sales activity for the
president of IBIS Capital, LLC, San Francisco, “85       previous six months, from their county recorder’s
percent of the 3,226 counties (2,743) in the U.S. are    office. Once the infor-
currently at the HECM floor,” even though the aver-      mation has been col-
age home value in that county may exceed $154,896.       lected, it should be
                                                                                       THE NEW FHA LOAN
    Only 45 counties, or 1.4 percent of the total, are   forwarded to the
at the current maximum loan limit, added Wagner.         appropriate HUD              LIMITS ARE MODIFIED
The balance (438 counties) are somewhere in              Homeownership
between.                                                 Center.                         IN ACCORDANCE
    Said Wagner: “Only a handful of counties are at a        Alternatively,
                                                         Wagner said the same              WITH THE NEW
proper loan limit threshold that accurately reflects
local home values. I’m a firm believer that we need a    information can be
                                                                                       FANNIE MAE/FREDDIE
single national loan limit. If we had one limit every    obtained more quickly
county would be at the ceiling, enabling seniors to      from the state or              MAC SINGLE-FAMILY
                                                         county chapter of the
                                                         National Association               LOAN LIMITS.
                                                         of Realtors.
NRMLA NEWS, continued from page 7                            “If the information
                                                         you present to the Homeown-ership Center clearly
Chicago Caregiver magazine.                              shows that the home values in your county are dis-
    The new issue of TIME Magazine (dated February       proportionately higher compared to the local HECM
17, 2003) includes an article on reverse mortgages       loan limit,” then it’s possible to get the loan limit
written by personal finance writer Jean Chatzky,         raised, the HUD official said.
who did a favorable piece on NBC’s Weekend Today             Typically, the Program Support Division within
Show on December 14.                                     each HOC is responsible for implementing changes
    There was some tarnish to the month’s cover-         to the FHA loan limits. To contact the appropriate
age, though, in an early February article written        Homeownership Center, go to http://www.hud.gov/
by nationally syndicated columnist Ken Harney,           offices/hsg/sfh/hoc/hsghocs.cfm.
which ran in a number of papers nationwide.                  Each HOC has its own Web site – accessible from
    Please send any local newspaper articles you         the Web address above – along with a list of primary
come across on reverse mortgages to Glenn                contacts, including the names and telephone phone
Petherick at NRMLA, fax 202-265-4435, e-mail             numbers of HUD staff in the Program Support
gpetherick@dworbell.com. RMA                             Division. RMA

 8                                                                     Reverse Mortgage Advisor    Winter 2003
HOME MODIFICATION WEEK, continued from page 1

their homes to make them more senior-friendly.          are all familiar with reverse mortgages. Duncan and
     According to Des Moines, IA consultant Jim         Christensen, in fact, spoke at NRMLA’s 2002 Annual
Baker, president of The Helping Home, falls in the      Meeting in San Francisco.
home are the leading cause of injury and deaths             All three companies offer in-home safety and
among seniors. Baker’s firm has put together fall       security assessments, a variety of information pro-
and injury prevention programs for insurance com-       grams, contractor referrals, and adaptive home
panies, municipalities, etc.                            products and services. More specifically, they can
     One of the working group’s primary goals will      help find ways to adapt a home to accommodate a
be to educate seniors about reverse mortgages and       wheel chair, prepare a home for the safety of chil-
how they can be used to finance home modifica-          dren or elderly parents, or adjust the living space to
tions, which can be costly. Another objective will      compensate for lifestyle and needs due to aging.
be to create a special web site that seniors, and           Lifease, Inc. also markets a unique software pro-
others, can use to learn about the different types of   gram that enables seniors to fill out an online ques-
products that are currently available, which are        tionnaire to assess their needs, abilities and home
designed to increase home safety and accessibility.     environment, and, based on the answers, suggest
     “We picked the week of November 9-15 because       improvements to their home and living arrange-
it’s an ideal time of the year for seniors and their    ment. Seniors normally pay a fee of $19.95 to take
children to start thinking about whether Mom’s          this home assessment survey. However, Christensen
home is ready for winter,” said NRMLA President         has agreed to waive the fee for consumers for the
Peter Bell.                                             two-week period during and following national
     “When families get together for the holidays –     Home Modification Week.
whether it’s Thanksgiving, Christmas or other sea-
sonal holidays– it’s the perfect time to discuss liv-   WHAT IS HOME MODIFICATION?
ability issues, like home safety and accessibility,”         Unlike home improvements, which are often
added Bell.                                             undertaken to enhance the value of a property
      Seniors are perhaps the least likely demo-        (i.e., kitchen enlargement, deck addition) or to
graphic group to take on a home modification pro-       make repairs, home modification is more closely
ject – often because of the cost implications. Yet      linked to the concept of universal design. The latter
older Americans are the ones who could most ben-        refers to products and living environments that are
efit from upgrades such as weatherizing doors and       adaptable to anyone, regardless of a person’s age
windows, installing energy conservation improve-        or health.
ments, installing safety devices in bathrooms,               According to a recent article from Senior Living
widening doorways, modifying kitchens, improving        published online at About.com, remodeling a home
lighting, etc.                                          for future levels of mobility can often be done easily
     “We feel the reverse mortgage provides the per-    and efficiently. Major problems encountered by the
fect means to finance various modifications to          elderly, according to the article, include:
make homes more senior-friendly,” said Bell.
                                                               Difficulty getting in and out of the shower.
HOME MOD PARTNERS                                              Slipping in the bathtub or shower.
    To help us in our efforts, NRMLA is working ini-
                                                               Difficulty turning faucet handles/doorknobs.
tially with three firms that specialize in home modi-
                                                               Access to home.
fication: The Helping Home; ADAptations, Inc.,
Bellevue, WA; and Lifease, Inc., New Brighton, MN.             Inadequate heating or ventilation.
    The principal from each organization – Susan               Problems climbing steps.
Duncan, of ADAptations, Inc., Margaret Christensen,
of Lifease, Inc., and Baker, of The Helping Home –                              HOME MODIFICATION, continued on page 10

 Reverse Mortgage Advisor      Winter 2003                                                                          9
HOME MODIFICATION WEEK, continued from page 9               MIAMI CONFERENCE, continued from page 1

   According to the Senior Living article, common           and how to expand their existing production.”
solutions to these problems include:                            The Miami Beach conference is open to both
                                                            NRMLA members and non-members, and is aimed
        Installing grab bars, shower seals, or              at both seasoned reverse mortgage professionals
        transfer benches.                                   and potential new entrants.
                                                                The conference will begin with a three-hour
        Placing non-skid strips or decals in the
                                                            course on the basics of reverse mortgage lending –
        bathtub or shower.                                  designed for reverse mortgage lenders that may
        Lowering cabinets and installing larger             want to send new staff for basic training, compa-
        cabinet knobs.                                      nies new to the reverse mortgage business, or those
                                                            considering entering this market.
        Installing ramps.
                                                                The introductory session will be followed by
        Installing insulation, storm windows and            panels on a variety of cutting-edge topics of interest
        air conditioning.                                   to both veterans and newcomers. Some of the pan-
        Installing handrails for support.                   els will cover:

                                                                    How Reverse Mortgages Are Enhancing the
    “When someone is very limited in their capabili-
                                                                    Lives of Seniors
ties – whether its vision, mobility, whatever it is – and
the living environment itself has all sorts of obstacles,           The Importance of Maintaining the Highest
they’re not going to be able to function very well,”                Ethical Standards
Christensen said. “To change that, you either improve
the capability of the person or you reduce the                      Marketing Strategies for Reverse Mortgage
demand of the environment.”                                         Originators
    She added: “Reducing the demand of the environ-
                                                                    The Counseling Process: Making It
ment means putting in all the modifications that will
                                                                    Meaningful and Effective
help a person function in their own environment and
be able to do the things they want.”                                Helping Seniors Age In Place: Promoting
    Some modifications can be quite costly, and the                 Home Modification To Improve Safety
elderly often are the ones who can least afford them.               and Comfort.
This is why consultants like Duncan will often refer a
client to a reverse mortgage lender, if the senior can’t        Our meeting will take
afford the costs out of pocket.                             place in the National Hotel,
    “The reverse mortgage has helped out a lot of my        located in the renowned
clients,” added Duncan.                                     Art Deco Historic
    To learn more about the Home Modification               District. This unique
Working Group, contact NRMLA’s Darryl Hicks,                South Beach Hotel is
202-939-1784, dhicks@dworbell.com. RMA                      located on the
                                                            ocean with direct
                                                            beach access, and only a
             A D D I T I O N A L I N F O R M AT I O N       quick stroll from the best restaurants,
                                                            galleries, boutiques and nightclubs.
                                                                Further information on the conference
                     www.lifease.com                        (see registration form on page 11) will be
               www.ADAptationsinc.com                       posted shortly on NRMLA’s Web site,
               www.design.ncsu.edu/cud                      or people can contact Laura Hampton,
                                                            202-939-1788, lhampton@dworbell.com. RMA

10                                                                       Reverse Mortgage Advisor     Winter 2003
                                               Conference Registration Form
                N AT I O N A L R E V E R S E M O R T G A G E L E N D E R S A S S O C I AT I O N E D U C AT I O N A L F O R U M
                                              April 8-9 • National Hotel, Miami Beach, FL

                                                Please complete a separate form for each registrant.

Firm ___________________________________________________________________________________________________________________________________________________

First Name__________________________________________________________    Last Name _____________________________________________________________________

Address ________________________________________________________________________________________________________________________________________________

City_________________________________________________________________   State________________________________   Zip _____________________________________

Telephone __________________________________________________________    Fax ____________________________________________________________________________

Email AddressWeb site _________________________________________________________________________________________________________________________________

Registration fee includes all conference sessions, Opening Reception on Tuesday, April 8, and Luncheon on
Wednesday, April 9.

Registration Fee

❏ NRMLA Member - $195                                                   ❏ Non-Member - $345


❏ Check Payable to NRMLA                           ❏ Visa               ❏ Master Card                 ❏ American Express

Card Number ________________________________________________________________     Expiration Date _______________________________________________________

Name on Card _______________________________________________________________     Signature _____________________________________________________________

This meeting will be held at The National Hotel in the heart of South Beach’s Art Deco District.

NRMLA has reserved a block of rooms at the special rate of $185 per night. To make a reservation, contact the National
Hotel, 1677 Collins Avenue, Miami Beach, FL, 33139, (305) 532-2311, and mention the National Reverse Mortgage
Lenders Association Meeting.

NRMLA has made arrangements for discounted fares on United and Southwest Airlines. To book a flight on United, call
(800) 521-4041 and refer to meeting code 549-TE. For Southwest, call (800) 433-5368 and refer to meeting code B0175.

 Reverse Mortgage Advisor             Winter 2003                                                                                                     11
LEGISLATIVE CAMPAIGN, continued from page 5
Write to the Washington, DC staff person. After your meeting,
write a brief letter to the Member’s staff person in the Washington, DC
office whose name you were given. Mention that you met with the
                                                                                       Updating Your
Member and were given his/her name as the person to contact in                         Web Site Listing
Washington about your issues. Include a business card and an informa-
tion sheet about your issues. Tell him/her that you would like to be of

                                                                                                   ith thousands of
assistance on issues affecting mortgage lending.
                                                                                                   potential reverse
Maintain contact. Always look for ways to maintain contact with your
                                                                                       mortgage borrowers visiting
Members of Congress. Letters, calls, and e-mails may all be effective.
Here are some ideas:                                                                   NRMLA’s Web site (www.

                                                                                       reversemortgage.org) each
       Attend their “town hall” meetings and be sure to reintroduce
       yourself.                                                                       month, lender members

                                                                                       should make sure their con-
       Go to civic club or other public meetings where they are speaking.
                                                                                       tact information that’s posted
       Get involved with community projects and attend charity                         on our site’s Lenders List is
       fundraisers they are involved with.
       If you like something the Member has done or said (even an                         Each NRMLA member
       appearance on C-SPAN or a radio talk show), send them a
                                                                                       lender is entitled to at least
       personal note of support.
                                                                                       one complimentary listing on
       Send them interesting articles about your business or about
                                                                                       the Lenders List – complete
       reverse mortgages, with a personal note attached.
                                                                                       with firm name, contact
       Send a congratulatory note if your Member is appointed to a
                                                                                       person, phone number,
       new committee or task force.
                                                                                       e-mail address, and Web
       When Congress adjourns for the year send the Member a note
                                                                                       address. Additional listings
       thanking them for their service.
                                                                                       may be purchased beyond
Keep NRMLA informed. We are developing a database of NRMLA                             the complimentary listing(s).
members who have established good contacts with their Members of
Congress. This will help us in targeting Members for contact when we                      We suggest you check
need their help on an issue. Send us copies of any letters you receive                 your listing(s) on the Lenders
from your Members, and let us know when you have a meeting sched-
uled so we can get you the latest information.                                         List at least once a month.

                                                                                       To make changes/ additions
Watch for and respond to NRMLA Alerts. When NRMLA needs you
                                                                                       to your listing(s), contact
to contact a Member of Congress to request a specific action, we will
send you an Action Alert. This will include detailed instructions and                  Brett Gerstein, 202-939-1799,
points to make in your letter and/or phone call. If you have established
                                                                                       bgerstein@dworbell.com.       RMA
a good relationship with the member as well as his home office and
Washington staff, your contact will be well received and very effective. RMA

12                                                                             Reverse Mortgage Advisor      Winter 2003

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