For two decades, Celink has been the nation’s leading subservicer of reverse mortgages.
Celink’s clients own the servicing rights to the loans they originate but contract with Celink to handle the administration part, whether it’s disbursing loan payments, handling customer service calls or working with the owners or the estate to pay off the loan once the property is permanently vacated.
Marion McDougall has served as CEO of Celink since May 2021. She is also the CEO of Compu-Link Corporation, which is responsible for servicing HECMs that have been assigned to the Department of Housing and Urban Development.
Before joining Celink, McDougall owned a consulting firm. She also held executive roles at Caliber Home Loans, MetLife Home Loans and First Horizon Home Loans. She has more than 30 years of financial services experience in the U.S. and internationally, focused on mortgage and retail banking with a particular emphasis on servicing, business development and client relations.
Reverse Mortgage sat down with McDougall to learn about the challenges that come with servicing reverse mortgages, technology that’s been developed to improve servicing efficiencies and steps that loan officers can take to improve the customer experience.
Reverse Mortgage: Since becoming CEO of Celink, what’s the biggest lesson you’ve learned about servicing reverse mortgages?
Marion McDougall: The reverse mortgage is poised to become the most critical product in our country. One in six Americans is aged 65 and older. Their retirement savings range between $150,000 to $200,000 depending on which articles you read. This is not enough to age in place and effectively maintain a home. More than 80 percent of seniors’ net worth is tied up in home equity. That tells me reverse mortgages will be viable for a long time. The next big question is how do we solve for that? It’s a vital product. The data supports that. We have plenty of resources in our country to produce the product. But it’s not happening. It’s still a very small volume in our country. That in my view can change and should change. At the end of the day, the biggest lesson I’ve learned is that scale matters in our business. If there’s not enough scale, this product won’t survive. That’s why I’m focused on this. The product needs to be more prevalent. More loans need to be originated. The borrower need is there. Servicing will only be healthy if there is an origination that’s created.
RM: Are there key differences between servicing a traditional mortgage versus a reverse mortgage?
MM: The average age of a reverse mortgage borrower in our portfolio is 75, while on the forward side, it’s the mid-40s. Reverse mortgage borrowers require more hands-on assistance. Nine out of ten contacts on the forward side are digital, while five out of ten touch points are digital on the reverse side. That’s a huge improvement from three years ago when we were probably closer to eight or nine touchpoints through our call center. Now it’s about 50 percent digital, 50 percent through the call center.
RM: What are some of the common questions that consumers contact Celink about concerning their reverse mortgage?
MM: The most commonly asked question is to confirm their line of credit balance followed by how much money they can access during the initial year and how to access those funds. The third most commonly asked question revolves around completing the annual occupancy certification, which can now be done verbally by phone through Celink’s IVR, or Interactive Voice Response, system. Number four involves inquiries about property taxes or insurance, while the fifth most commonly asked question involves changes to payment plans.
RM: Tell me more about the IVR.
MM: Our IVR is predictive. So, for example, if you’re calling, our IVR will recognize it’s you because it does the authentication electronically and predicts why you’re calling. The IVR menu is customized to you. If you just got a letter that said we need your occupancy certification, the IVR would start with that. Or, if you got a letter about your taxes, the IVR would start with taxes. We’re predicting why you’re calling so it’s faster for the borrower. It’s a better borrower experience to get that menu in the order that we believe is the reason for the call.
RM: HUD has implemented numerous reforms over the past year to benefit consumers. Which of these reforms will most impact improving the servicing process?
MM: The most significant change is one I just mentioned, which is the ability to verify occupancy verbally, which HUD announced in Mortgagee Letter 2023-23 last November. This change allows borrowers to have another avenue than just the mail. It’s a great convenience to the borrower and helps prevent loans from going into due and payable status, which you know, of course, causes concerns and stress that’s not needed. This has been absolutely huge.
RM: Celink has been at the forefront of adopting technologies that enhance servicing efficiencies. What can you share about these improvements? Is there anything new that’s under development that you can discuss?
MM: We modernized our legacy system starting in 2019, which has resulted in some big wins. For example, we’re able to process line of credit draw requests 60 percent faster compared to a few years ago. We also implemented a tool to make the loan assignment process more efficient. Ninety-seven percent of the loans that we service are assigned immediately after reaching 98 percent of the maximum claim amount (MCA), all through a technology tool that we deployed about a year and a half ago that helps us better manage timelines and obtain documents from our clients more quickly. Lastly, we recently expanded our IVR which I just spoke about. The enhanced logic offers extensive options for borrowers. I mentioned that the IVR anticipates why the borrower is calling, and then allows for self-serve options. As of the end of May, 35 percent of the borrowers who call us choose a self-serve option, and that will continue to grow. Sixty percent of LOC draw requests go through a digitization process, meaning we don’t have to talk to the borrower, it’s all done electronically.
RM: Where does AI fit into these efforts?
MM: LOC draws and the documents that need to be processed are handled through an AI process. In addition, every month, we have 50,000 customer calls go through an AI scoring mechanism. The customer calls in and the machine goes through all those calls and scores them based on about ten components. The AI assesses whether the call was done well and gives it a score. Any score below the threshold we’ve set, we then manually review. We don’t have the workforce to review 50,000 calls, but the AI machine can do that. We’re looking forward to leveraging generative AI for tasks like pre-call and post-call summarization, which will further enhance efficiency and the borrower experience.
RM: What additional policy changes would you like to see adopted by FHA to help further improve the servicing experience for borrowers?
MM: This doesn’t directly impact borrowers, but Ginnie Mae and the industry have been working on HMBS 2.0. If it gets adopted, I believe more lenders will enter the market, which then will make the product available to more consumers. Perhaps the most important change I’d like to see adopted, one which I think would be close to your heart because NRMLA has been advocating for it, is to lower the upfront mortgage insurance premium. Volumes would increase and more consumers would embrace the product. (Editor’s note: HMBS 2.0 refers to a new securitization option that Ginnie Mae is working on that would allow HECMs with balances above 98 percent of MCA to be bought out of their existing securities and re-securitized into new pools.)
RM: As much education as NRMLA strives to provide, many loan officers don’t fully understand FHA’s policies and timelines that servicers must strictly follow. What words of wisdom would you like to share with our readers to help them better understand Celink’s role and responsibilities?
MM: Celink wants to work with every borrower and their heirs to deliver the best solution for their situation. However, Celink must abide by program guidelines and timelines set forth by HUD and our clients and failure to do so will result in financial penalties. We encourage loan officers to make sure borrowers and heirs know that staying in touch with the servicer, especially if there is a default or when the borrower passes away, is key. Loan officers can help reiterate that communications from the servicer – mail, phone calls and emails – contain important information regarding their loan that may be time-sensitive and should not be ignored. Responding and acting timely when the servicer reaches out will provide a smoother customer experience and may prevent the loan from going into default unnecessarily. We can’t track if borrowers read their mail, but we do know that 70 to 80 percent of them open their emails. Our goal is to get as close to a 100 percent open rate as possible. Getting borrowers to look at the communications we send is critical.
RM: How can loan officers make your job easier?
MM: Borrowers often contact their loan officer with servicing questions because they’re considered a trusted advisor. However, loan officers must confirm the answers to borrower questions first and avoid guessing if they’re not sure. Answering servicing questions incorrectly, even with the best of intentions, is harmful and negatively impacts the borrower’s perception of the product and process. It’s best always to refer them back to us. We are the experts. When an event happens, we will know how to guide either the borrower or the heirs through that event.
