Georgia Reverse Mortgage: 10/28 Reverse Mortgage Daily

Reverse Mortgage Daily

LTC Global Acquires Another Reverse Mortgage Company

October 27, 2010 at 3:19 PM

LTC Global has acquired a controlling equity interest in EquiPoint Financial Network, a San Diego, CA, based reverse mortgage lender.

Last year, LTC Global agreed to acquire a majority interest in another reverse mortgage lender, Next Generation Financial Services (NGFS), which is currently operating as a division of 1st Mariner Bank.

"The EquiPoint acquisition is part of our strategy to expand our financial product offerings to the senior market," said Thomas A. Skiff, Chief Executive Officer of LTC Global. "We expect substantial synergies between EquiPoint and NGFS. We admire what Bruce Barnes and the EquiPoint team have accomplished in the industry so far, and we're looking forward to working with them."

EquiPoint's principal Bruce D. Barnes will continue to serve as President of the company.

"LTC Global's resources and experience in the senior market will complement EquiPoint's business. In particular, LTC Global's financial strength will enable EquiPoint to underwrite, close and warehouse a substantial inventory of loans," said Barnes. "We also anticipate significant marketing synergies," he said.

The deal makes a lot of sense for a couple reasons. As long as First Mariner is in bad shape financially, there isn't much NGFS can do as part of the bank. However, if LTC Global wanted to take the company out of First Mariner, they wouldn't have any licensing to originate loans since they've been operating under the bank's charter.

By acquiring a controlling interest in EquiPoint −which is licensed in 21 states − they can quickly hit the ground running if they choose to move NGFS out of the bank. RMD asked whether the company planned on doing that and they wouldn’t comment.

EquiPoint is the 18th largest reverse mortgage lender in the country according to data from the Department of Housing and Urban Development. The company endorsed 478 HECM loans during FY 2010.

Terms of the deal were not disclosed.

New Speakers Added to NRMLA Annual Event

October 27, 2010 at 2:21 PM

In less than one week, reverse mortgage professionals from around the country will gather in New Orleans for the 2010 National Reverse Mortgage Lenders Association Annual Meeting and Expo.

The event, which takes place November 3 through 5 at the Roosevelt New Orleans, will feature over 30 exhibitors, 21 informative sessions, and 78 speakers from 46 different companies.

The association announced new speakers including Paul Spindt, Keehn Barry Chair Professor at the Freeman School of Business at Tulane University, who will discuss the economy and Colin Cushman, Financial Economist at HUD, the person responsible for engineering the HECM Saver.

They will be joining Ginnie Mae President Ted Tozer, FHA Commissioner David Stevens, and Deputy Assistant Secretary Vicki Bott to discuss the future of the industry.

Additionally, the National Mortgage Licensing System and Registry (NMLS) approved NRMLA as an official course provider enabling licensed mortgage loan originators to earn continuing education credits for the SAFE Act at future NRMLA events. To learn more about the event, see here.

Written by Kelly Mellott

Editors Note: RMD will be there covering the event and doing interviews, have something to say? Let us know.

Escrow Accounts for Reverse Mortgages? [Poll]

October 27, 2010 at 10:58 AM

Best Reverse Mortgage writer Peter Miller brings up a good question… why not have escrow accounts for reverse mortgage borrowers?

He writes:

I used to be one of those who objected to escrow accounts on the grounds that I'm a responsible citizen and can set aside money each month for taxes and insurance — and collect the interest earned from such accounts. But now my view has changed because the interest earnings are minimal and when a lender collects money for taxes and insurance it's not an issue of concern anymore. Reverse mortgage borrowers should also enjoy such assurances — and so should HUD.

This is not just a concern for borrowers and those with FHA reverse mortgages. Reverse lenders want to have a good and credible product to sell and it does not help when borrowers fail. Given this reality, you can suspect that more than a few reverse lenders would actually like to see an escrow requirement — that would create an even competitive field for all lenders while also helping many senior borrowers.

There has been discussion of the Department of Housing and Urban Development having a “financial assessment” as part of the HECM, but nothing official yet.

I thought I’d pose the question to RMD readers. Let us know what you think.

Escrow Accounts For Reverse Mortgages

View Poll

Association Concerned Government Regulation of Product Design May Hurt Industry

October 27, 2010 at 10:52 AM

Money Management is reporting that the Senior Australian Equity Release Associaiton (SEQUAL) is concerned the Federal Government’s desire to regulate reverse mortgage product design could have a harmful effect on the industry.

The government is reviewing the process of reverse mortgages, focusing on product disclosure, design, and consumer financial literacy being the three areas being discussed. In the weeks leading up to the Federal Election, the Government promised to provide greater disclosure of equity release products and statutory protection against negative equity — with the two changes to be implemented by mid 2012.

"[Statutory protection for the no negative equity guarantee] is a critical aspect of consumer protection which, because the SEQUAL membership is not compulsory, cannot be reliably delivered across the industry unless there is regulatory change," said Kevin Conlon, chief executive, of SEQUAL.

"However, product design is driven by not just competitive tension but also the availability of funding, and influencing product design can have an effect on not only consumer protection but the availability of the products," Conlon said.

Concerns Over Equity Release Product Design Regulation