A boom in reverse mortgages is on the way as a growing segment of the population heads toward retirement, an industry leader has claimed.
The industry is at a tough point and volumes are constrained, but the market is vast, deep and underserved, Premier Home Equity president and CEO Bart Johnson has told the National Reverse Mortgage Lenders Association (NRMLA).
“In my opinion, we are less than 2% market penetrated,” Johnson said.
Speaking at the group's 2013 Western Regional Conference this week in Irvine, Calif., Johnson said a swell in the population of retirees would drive growth for reverse mortgage lenders.
“Older boomers need help to figure out how to finance longevity and retirement. The prospects for this program exploding are terrific. We will be much bigger, if not this year, then next.”
Depending on the source, there are an estimated 60 to 75 million boomers entering or approaching retirement. NRMLA president and CEO Peter Bell said this spells opportunity for reverse mortgages.
“None of us are getting any younger, and this is the only place you go where that’s good news,” Bell said.
The 225 attendees at the NRMLA conference this week focused on topics addressing the major changes the industry has already seen this year and how they can use the “bigger picture” – including engaging financial planners and navigating new HUD and CFPB rules – to adjust and fit the needs of today’s borrowers.
“The only constant in the reverse mortgage business is the constant state of change,” Bell said.