basic misunderstandings remain relatively consistent, says Richins. Chief among them is that borrowers still worry lenders will take their house after they die. FSI Mortgage tackles the issues directly through seminars and classes offered to the public. The subjects have included how to use home equity to fund retirement, as well as other programs available through local and national agencies. The key, Richins says, is to focus on the educational content—such as directly addressing borrowers’ misconceptions—rather than making the courses a product sales pitch. “We’re not trying to talk them into anything because I think a homeowner is totally capable of making a decision,” she says. Knowing how this type of loan works gives the homeowner the ability to decide if it fits in with their planning. Social media is beginning to emerge as a platform to reach potential reverse borrowers, she says. But it is not quite there yet. “I think in the next couple of years we’ll start seeing more of it.” Current Market After a prolonged period of low interest rates, reverse lenders are now contending with an extended forecast for higher rates, which reduces the amount of home equity borrowers can withdraw. The Fed expects to keep interest rates at their current levels through at least late 2024. Despite some headwinds, reverse mortgages continue to benefit from longer-term trends. One of the most significant is the aging of the Baby Boomer generation, whose youngest members will start turning 62 in 2024. As a cohort, Boomers are more comfortable with debt than previous generations, and they are more likely to be carrying mortgages into retirement. A reverse mortgage allows them to eliminate their mortgage Taking Account continued from page 19 20 REVERSE MORTGAGE / JANUARY-FEBRUARY 2024
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