25% of CHIP reverse mortgage originations have come from brokers this year, according to HomEquity Bank.
Last year it was only 15%.
There are at least five reasons behind this surge in broker referrals. Among them:
Change: CHIP’s product has noticeably improved in the last few years—in both pricing and flexibility. In turn, the public seems to have a growing acceptance of, and need for, reverse mortgages. (Total originations grew 18% last quarter.) Being highly entrepreneurial by nature, brokers excel at educating consumers about new and revamped mortgage products.
Ease: More brokers are discovering how easy it is to refer clients to CHIP. (It’s a simple referral form.) CHIP manages almost everything, including the application, approval and closing.
Recent Promotions: CHIP is doing a better job of promoting its lower eligibility age (55) and higher loan-to-value maximum (50%).
Competition: Some brokers are undoubtedly shifting some business to alternative products as traditional “A” lending gets more competitive.
BDM Support: CHIP’s business development managers (BDMs) are incentivized and widely supportive of brokers.
Sidebar: Reverse mortgages are not meant to be an ideal product for the masses. CHIP is, however, a saviour for those with no better options—and that includes a growing percentage of cash-strapped seniors.
Rob McLister, CMT
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