Shain Urwin sees a more balanced relationship emerging between reverse mortgage lenders and brokers under new industry agreements \u2014 but he says they\u2019re not enough to solve a deeper structural problem.<\/p>\n
In recent years, lenders like Mutual of Omaha Mortgage<\/strong><\/a> and Longbridge Financial<\/strong><\/a> have launched programs designed to protect the loan pipelines of broker partners, addressing the persistent tension between retail and wholesale operations at multichannel lenders.<\/p>\n \u201cThis broker-to-lender relationship needs to be a two-way street,\u201d Urwin, the national reverse mortgage director for broker C2 Financial<\/a><\/strong>, said in an interview with HousingWire<\/strong>\u2018s Reverse Mortgage Daily. \u201cThat relationship now, I see a huge shift that happened in the last two years. The brokers now have lenders to have our backs.\u201d\u00a0<\/p>\n He offered a caveat: \u201cUnfortunately, most of this is for refinances,\u201d adding that the industry cannot rely solely on these loans and needs to attract new borrowers \u2014 particularly affluent clients.<\/p>\n Urwin, who entered the reverse mortgage space in 2017 while at Fairway Home Mortgage<\/strong><\/a>, said C2 Financial completed only 16 refinances of Home Equity Conversion Mortgages (HECMs) last year, with about 40% of its business coming from proprietary products<\/a>. C2 is one of the nation\u2019s largest brokerages<\/a>, with 1,115 licensed loan officers, 111 branches and $4.85 billion in volume over the past year.<\/p>\n In a candid conversation, Urwin discusses why the industry sometimes sabotages itself<\/a>, its biggest opportunities and how the lender-broker relationship has evolved.<\/p>\n Editor\u2019s note: This interview has been edited for length and clarity.<\/em><\/p>\n Fl\u00e1via Furlan Nunes: How do you view the current landscape for reverse mortgages?<\/strong><\/p>\n Shain Urwin: <\/strong>The market hasn\u2019t changed much. Obviously, we haven\u2019t seen anything come out from the U.S. Department of Housing and Urban Development<\/strong> (HUD) since October 2017<\/a>. <\/p>\n I\u2019m on the board for the National Reverse Mortgage Lenders Association<\/strong>, and I\u2019m also a part of the NRMLA education committee. I see a lot of the conversations and things that are maybe at work, but we haven\u2019t seen any big shifts or changes about the negative of the industry. We\u2019re going backward. <\/p>\n If you take the past few decades, the numbers have gone down<\/a> almost every year. The problem is, as an industry, we\u2019re sabotaging ourselves. Not just the broker world \u2013 lenders, all of us. We\u2019re turning to the same clients. We\u2019re just refinancing and we\u2019re not bringing enough new people. The overall landscape is not rosy.\u00a0<\/p>\n Nunes: Where do you see the biggest opportunities for growth in the industry?<\/strong><\/p>\n Urwin: We\u2019re starting to see traction with more affluent clients<\/a>. A lot of the loans we\u2019re closing as a company are for more affluent clients. We\u2019re also seeing a big shift in proprietary lending that\u2019s happening nationwide. <\/p>\n But being C2 Financial based out of San Diego, most of our loan officers are California-based. We have almost 1,200 loan officers at C2 \u2013 I\u2019d say around 70% of them are based in California. And about 40% of our business are proprietary products. I just closed one \u2014 the house was $14 million free and clear. You don\u2019t come across this every day. That client is affluent. They owned a $14 million house with cash and they chose to get a reverse mortgage.<\/p>\n Nunes: How do these borrowers differ from traditional reverse mortgage clients?<\/strong><\/p>\n Urwin: <\/strong>The client for reverse, there\u2019s two stereotypes: One is a needs-based client that basically has nothing left but their house. They\u2019ve spent their assets. They\u2019re down to home equity. <\/p>\n In California, there are a lot of \u201chouse-rich, poor people\u201d \u2014 they have a $2 million house, but they don\u2019t have any money, so they\u2019re looking at a reverse out of need. Then we have the more affluent. And I would say that client\u2019s net worth is about $2 million to $6 million, and those clients are looking at it for tax strategies<\/a> \u2014 maybe to be able to deduct interest strategically by making mortgage payments when they want to instead of when they have to. We have others that use it as a buffer asset, or what we call a non-correlated asset.<\/p>\n Nunes: What impact is this landscape having on lenders and brokers?<\/strong><\/p>\n Urwin: <\/strong>I don\u2019t think lenders and brokers are much different in the way the industry is impacting us. When it comes to pricing, brokers have a little more autonomy \u2014 they can make things happen a bit more easily than lenders, partly because of overhead. <\/p>\n I\u2019m working out of my home office. I don\u2019t have a brick-and-mortar building. But the lenders own the market. When you look at the facts, Mutual of Omaha, Longbridge and Finance of America<\/a><\/strong> \u2014 those three own the market. They do more than all the rest of us combined. <\/p>\n We\u2019re one of the largest brokers in the country. There are only a couple of big brokers in the space, and we\u2019re closing hundreds while they\u2019re closing thousands. But to be honest, if you were to take the best \u2014 Mutual of Omaha \u2014 what are they going to close, 5,500 units? It\u2019s pretty pitiful.<\/p>\n Nunes: Some reverse lenders are revisiting their agreements with brokers. What are the main pain points driving these discussions?<\/strong><\/p>\n Urwin: <\/strong>As brokers, we don\u2019t create the loan. We shop the loan out and use different investors. Those relationships need to be two-sided. The industry has been filled with one-sided relationships. Lenders have called all the shots and it\u2019s been that way for years. <\/p>\n I sat down with Alex Pistone<\/a>, president of Mutual of Omaha Reverse Mortgage, about two years ago at a NRMLA conference. He said, \u201cHow come you\u2019re not sending any business to us?\u201d I said, \u201cWe wouldn\u2019t send you business because you\u2019re going to come and take our business.\u201d<\/p>\n This broker-to-lender relationship needs to be a two-way street. We need know that we\u2019re going to send a loan to someone, and that client is not going to be taken from us, especially when the refinance happens. I told him what we needed were protections. We want to make sure you\u2019re not soliciting our clients, that you\u2019re trying to send a loan back to us, and that we can put our name on the statements. <\/p>\n United Wholesale Mortgage<\/a><\/strong> is who developed that. And Alex came back in and created Broker Protect. He rolled that out to C2 and then gave it to the industry. That was a domino that needed to fall, and it allowed us to have control for the first time \u2014 a little bit of power. We have that agreement in place with every single investor we choose to do business with. Longbridge and us are coming back together today (March 19). About four months ago, we decided to take a break until we could figure this out. They were in the works of doing this, but I was like, \u201cUntil it\u2019s done, we don\u2019t want somebody soliciting our clients.\u201d\u00a0<\/p>\n I understand the lender side. They don\u2019t want to lose that client to somebody else who\u2019s aggressively marketing.\u00a0There are three companies that are very aggressive at churning the business<\/a>. They don\u2019t care about NRMLA\u2019s 12- or 18-month waiting periods. Once the loan closes, they\u2019re going to market it. <\/p>\n Companies like Longbridge are going to do their best to retain it, which makes sense. That relationship now, I see a huge shift that happened in the last two years. The brokers now have lenders to have our backs.<\/p>\n Nunes: What positive changes do these agreements bring?\u00a0<\/strong><\/p>\n Urwin: <\/strong>The biggest is communication. I haven\u2019t worked with Longbridge on this yet. We\u2019re going back into business with them now. But I can give you an example with Traditional Mortgage Acceptance Corp.<\/strong><\/a> and Mutual of Omaha, which we closed the most business with. When someone calls for a payoff, they tell us immediately, \u201cHey, this loan is getting paid off.\u201d Often, they even know who is ordering the payoff.\u00a0<\/p>\n One thing happening in the market is that, with the new trigger leads<\/a> law, far fewer people will know when a credit pull occurs \u2014 but the servicers will still know. They\u2019re opted out of that. A name on the statement, that doesn\u2019t excite me as much, because in the end, it\u2019s co-branded. Honestly, I don\u2019t want them calling us \u2014 we\u2019re not staffed like they are.\u00a0<\/p>\n To answer your question: I think it\u2019s perfect the way it is. If we\u2019re going to market and co-brand with a broker, and they\u2019re going to protect the client if someone is trying to refinance, that\u2019s really the heart behind the issue. Both of us want to keep that client.<\/p>\n Nunes: What gives the lender confidence that the loan will be delivered to them?<\/strong><\/p>\n Urwin: <\/strong>I would say that is a loose understanding. No. 1, it\u2019s impossible to police \u2013 I couldn\u2019t make it happen, and it could even be a violation. You\u2019d be into steering<\/a>. We don\u2019t have an agreement that says we will send the loan back to Longbridge or Mutual, but just like you and I are good people, and I want that investor to keep that loan, I want to do what I can to make that happen.\u00a0<\/p>\n If the client says, \u201cI need to take this loan somewhere else. I don\u2019t like Mutual or the way they\u2019ve been treating me,\u201d then I\u2019m going to tell Mutual, candidly. But I\u2019m not trying to steer the loan somewhere. The reality is, we\u2019re going to try our best to keep a partnership and a relationship with people. And I have no problem looking at my client and saying, \u201cHey, we closed this loan with Mutual. I\u2019d like to keep this loan here; if you want to look at other options, we can.\u201d But 99% of the people are going to be fine.<\/strong><\/p>\n As a partnership<\/a>, you\u2019re trying to do what you can to protect each other. That\u2019s the whole point of it. But not at the client\u2019s detriment, at the client\u2019s benefit. Urwin:<\/strong> Unfortunately, most of this is for the refi. I don\u2019t think it\u2019s bad to have that. Also, to get the message out right, a lot of these people are refinancing with very little net benefit. <\/p>\n Today, when you think about it, Federal Housing Administration <\/strong>forward mortgages and U.S. Department of Veterans Affairs<\/strong> forward mortgages have hard, fast rules\u2014 you cannot refinance a client unless there\u2019s enough net benefit. The reverse rules are iffy. They\u2019re more open to interpretation and we need more guidance, either from the government level or NRMLA<\/a>.<\/p>","protected":false},"excerpt":{"rendered":" Shain Urwin sees a more balanced relationship emerging between reverse mortgage lenders and brokers under new industry agreements \u2014 but he says they\u2019re not enough to solve a deeper structural problem. In recent years, lenders like Mutual of Omaha Mortgage and Longbridge Financial have launched programs designed to protect the loan pipelines of broker partners,…<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false},"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/mk.gen.tr\/en\/wp-json\/wp\/v2\/posts\/48105"}],"collection":[{"href":"https:\/\/mk.gen.tr\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mk.gen.tr\/en\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/mk.gen.tr\/en\/wp-json\/wp\/v2\/comments?post=48105"}],"version-history":[{"count":0,"href":"https:\/\/mk.gen.tr\/en\/wp-json\/wp\/v2\/posts\/48105\/revisions"}],"wp:attachment":[{"href":"https:\/\/mk.gen.tr\/en\/wp-json\/wp\/v2\/media?parent=48105"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mk.gen.tr\/en\/wp-json\/wp\/v2\/categories?post=48105"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mk.gen.tr\/en\/wp-json\/wp\/v2\/tags?post=48105"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
Nunes: What is the current status of these agreements?
<\/em>
Urwin: <\/strong>We went to every one of our investors and said, \u201cWe need the same thing. If not, we can\u2019t do business with you.\u201d We had to part ways with a few relationships for a while, and the two biggest names were Liberty\/PHH<\/a><\/strong> and Longbridge. It wasn\u2019t done perfectly, but I know that both of those companies, including the other companies we deal with, all wanted to give us a version of that. We\u2019re finally there.<\/p>\n
<\/em>Nunes: How do these agreements support efforts to attract more and more diversified clients?<\/strong><\/p>\n