I received an email a few days ago from a prospective customer. I say prospective loosely because I'm quite sure he won't become one.
He completemented me on my fine job of marketing to him as a lead-in to what he really wanted. He said, "how can you get me the most money out of my home, compared to another lender."
There is actually no way to do it another way. All of us in reverse mortgages use the same formula to establish the cash amount that can be removed from a loan.
So he asks me to use an appraiser that really does a "good job". Of course this is code for an appraiser who fudges up his numbers to make the loan or transaction work.
His reasoning behind this is that a bigger loan will be handed out if there is a higher report of home worth.
With home values reducing he is in the same shaky boat as many senior mortgage holders. They want to use the reverse loan to rid themselves of the burden of the monthly payment.
If the appraisal doesn't come in high enough the reverse mortgage company can't, in many cases, lend enough to pay off the borrower's forward mortgage. The end result is the guy is stuck with that payment until values come back.
Unfortunately borrowers aren't the only ones struggling; appraisers are as well. For awhile they were able to pad their appraisal reports.
If you are a strict rule following appraiser, the above statement might tick you off a bit, but come on, it is general knowledge this practice was occurring.
Presently everyone in the housing industry is being held responsible for the mortgage debacle, appraisers too. A closer eye is being kept on them than previously.
Appraisal audits are more frequent than ever and appraisers are running the risk of losing their license if business is not conducted as it should.
So, that is what I told this guy. I haven't heard from him since. I told him other companies would tell him how their appraiser will definitely get him the greatest value.
Most lenders will promise it, but won't do anything differently when it comes down to it. I choose to let seniors know all the facts and risk losing them as a client.
He completemented me on my fine job of marketing to him as a lead-in to what he really wanted. He said, "how can you get me the most money out of my home, compared to another lender."
There is actually no way to do it another way. All of us in reverse mortgages use the same formula to establish the cash amount that can be removed from a loan.
So he asks me to use an appraiser that really does a "good job". Of course this is code for an appraiser who fudges up his numbers to make the loan or transaction work.
His reasoning behind this is that a bigger loan will be handed out if there is a higher report of home worth.
With home values reducing he is in the same shaky boat as many senior mortgage holders. They want to use the reverse loan to rid themselves of the burden of the monthly payment.
If the appraisal doesn't come in high enough the reverse mortgage company can't, in many cases, lend enough to pay off the borrower's forward mortgage. The end result is the guy is stuck with that payment until values come back.
Unfortunately borrowers aren't the only ones struggling; appraisers are as well. For awhile they were able to pad their appraisal reports.
If you are a strict rule following appraiser, the above statement might tick you off a bit, but come on, it is general knowledge this practice was occurring.
Presently everyone in the housing industry is being held responsible for the mortgage debacle, appraisers too. A closer eye is being kept on them than previously.
Appraisal audits are more frequent than ever and appraisers are running the risk of losing their license if business is not conducted as it should.
So, that is what I told this guy. I haven't heard from him since. I told him other companies would tell him how their appraiser will definitely get him the greatest value.
Most lenders will promise it, but won't do anything differently when it comes down to it. I choose to let seniors know all the facts and risk losing them as a client.
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