Excerpt from Reverse Daily Mortgage showcases the impact the ongoing pandemic has made on those seeking information on reverse mortgages.

Based on observations from reverse mortgage counselors, those seeking information are better-prepared for their counseling sessions regarding their understanding of the reverse mortgage product category.  The publication notes that this could be a potential sign that the industry itself is doing an effective job of responding to the financial need that the COVID-19 coronavirus pandemic has created.

GreenPath Financial Wellness was one of the resources cited in the article.

In general, the reverse mortgage industry has become more effective in meeting the needs of consumers especially during this time of heightened financial stress for seniors.

GreenPath’s observations

At GreenPath, reverse mortgage counselors have been observing no discernible increase in the stress exhibited by clients in light of the pandemic on the parts of clients according to Kathy Conley, stakeholder engagement specialist at GreenPath.

“Our counselors have not reported an increase in the anxiety level of the clients they counsel for reverse mortgages,” Conley tells Reverse Mortgage Daily. “It seems potential reverse mortgage borrowers are more prepared to use assets for what may be more of an economic downturn and are planning ahead. It does seem that those borrowers understand that a reverse mortgage is another tool which can help them.”

Clients also seem to understand the product category more during the current period, Conley says.

“Compared to 2019, based on reports from our counselors, it appears that clients are a little more informed and prepared for the counseling session,” noted Conley.

Other key trends

Since the financial crisis that led to the Great Recession in the late 2000s and early 2010s, funds appropriated from the United States Congress for housing counseling have been declining. This means that some counseling organizations, including GreenPath, exhausted their funding more quickly in light of a surge in housing counseling volume driven by the strain of the pandemic, Conley says.

“Some generous companies have stepped up and aided capacity building by putting grant money out there to help support the cause,” Conley says. “Wait times were impacted at many agencies. Many lenders and servicers had significant wait times as their phone lines were flooded with relief requests. However, this was (and is) not the case at GreenPath.”

At significant effort and expense, GreenPath has been able to provide its services remotely and seamlessly, benefitting from a previous transition to remote work from a “significant portion” of the organization’s employees in 2019.

Preparing for the end of temporary relief

Other divisions within the counseling companies also reported a rise in incoming inquiries from consumers, due to new questions that the pandemic created about their mortgages and debts, Conley explained. Those peaks observed earlier in the pandemic have started to decrease because of government assistance in the form of the CARES Act, foreclosure and eviction moratoriums and temporary credit payment deferments.

This, however, could be a lull before another large influx as some of those previous protections handed down by the government begin to lapse, Conley says.

“We recognize that this assistance could be the calm before the storm,” she says. “As consumers move out of these respite periods, they will undoubtedly need more assistance for financial recovery. GreenPath can help consumers as forbearances and moratoriums end and deferred payments need to be addressed.”

Read the full article. 

 

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