Ethical Practices are the Backbone of Any Business

Mortgage and Lending with PS Mortgage Lending 305-791-4874 or 888-845-6630 365768

Ethical Practices are the Backbone of Any Business

More rules and regulations are coming into effect this year, this time via the Consumer Financial Protection Bureau, effectively creating a safer, more ethical atmopshere for consumers.

The new rules won't effect reverse mortgages directly, according to an article published in Reverse Mortgage Daily, and will be focused on retail loan originators instead of wholesale loan originators.

A recent National Reverse Mortgage Lenders Association webinar, however, noted that loan originator compensation will affect how loan transactions are done, especially among fixed rate reverse mortgages. Fixed rate HECM loans have become a minority though, since the elimination of the fixed rate standard on July 1. The only fixed rate product available under the reverse mortgage product is the HECM Saver loan.

The new rules will implemented to prevent another Castle & Cooke scandal from happening, where a Utah lender persuaded borrowers to take out mortgage loans with high interest rates and then compensated its loan originators with bonuses based on the loans' interest rates. The Federal Reserve's loan officer compensation rule, however, bans compensation based on the terms of originated loans such as interest rates. THE CFPB estimates that around 150 loan officers were paid quarterly bonuses ranging from $6, 100 to $8,700 since 2011.

Legal counsel Jim Milano of Weiner Brodsky Kider PC, said:

“It looks like the bureau’s going to be out there actively looking at these things. [...]it would be prudent for companies to review comp plans and make sure they are up to speed.”

At PS Financial Services, a reverse mortgage company in Florida, we work with our clients in order to find the best product that works for them. We offer wholesale prices, not retail, as well as adjustable-rate reverse mortgages, which ensure that your experience will be satisfactory. 

While we believe in the HECM Saver, and it's ability to make retire comfortable for older Americans, we do not pressure our clients on one product or the other. Our job isn't to pitch one loan over the other but to find the lender that works best for you. 

New reverse mortgage regulations are being implemented to make sure the program continue to run as smoothly as possible. It is your chance to take advantage of this product, which has helped many retirees in the past.

Milano stated:

"There's likely to more [rules] against cross selling, more counseling requirements and more rules around advertising. Some may not want to be in this business because it's costly to comply..."

The unethical practices of some companies are troubling but this new rules will be effective in weeding out lenders and loan originators who sell consumer impractical loans at unnecessarily high interest rates.

Ethical practices are the backbone of any honest worker, you just have to decide which side you are on before it causes irreparable damage.

Interested in a reverse mortgage program or want more information? Give PS Financial Services a call at (888) 845-6630 or email us at We do not pressure those who inquire.

Click here for more information about the elimination of the reverse mortgage program as we know it:

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Information and content in this blog is original to Phil Stevenson

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Phil Stevenson

PS Financial Services

Owner and Principal Mortgage Originator

Certified Reverse Mortgage Professional (CRMP)

LO #365768

NMLS #968090

Cell: 888.845.6630

Miami Mortgages & Florida Mortgages

Copyright © 2013 by Phil Stevenson & PS Financial Services, LLC

Comments (12)

Anna Banana Kruchten CRS, CRB, Phoenix Broker
HomeSmart Real Estate BR030809000 - Phoenix, AZ

Phil I don't know that much about reverse mortagages but sounds like there is some changing that needs to happen to protect folks?

Sep 02, 2013 04:40 AM
Phil Stevenson, CRMP
PS Mortgage Lending 305-791-4874 or 888-845-6630 - Miami, FL
"Mortgage Nerd" in Miami, Florida and Texas

Anna, thanks for stopping by!

The new rules are to protect consumers from fraudulent mortgage transactions across the board, not specifically reverse mortgage brokers. This is in light of various mortgage scandals such as Castle & Cooke. In truth, there are unethical practices in any business, this is more of a preventative method that will be implemented to protect future consumers but it's not geared toward reverse mortgages specifically, just indirectly, whenever retail loan are conducted, which isn't that often.

Sep 02, 2013 05:01 AM
Brian Sharkey
SharkeyRE LLC - Tequesta, FL
SharkeyRE - #SouthFloridaBroker

Phil, I just stopped by to wish you a happy Labor Day, I hope all is well.

Sep 02, 2013 05:10 AM
Phil Stevenson, CRMP
PS Mortgage Lending 305-791-4874 or 888-845-6630 - Miami, FL
"Mortgage Nerd" in Miami, Florida and Texas

Brian, a Happy Labor Day to you too. Thank you!

Sep 02, 2013 05:23 AM
Travis "the SOLD man" Parker; Broker/Owner
Travis Realty - Enterprise, AL
email: / cell: 334-494-7846

We just had a Board program on the NEW Reverse Mortgages. Seems like they have most of the previous issues worked out.

Sep 02, 2013 06:17 AM
Phil Stevenson, CRMP
PS Mortgage Lending 305-791-4874 or 888-845-6630 - Miami, FL
"Mortgage Nerd" in Miami, Florida and Texas

Travis, that's great! Little by little, the program will continue to improve and become better as time goes on. It's important to notice the work that's being put into making it better, ultimately, it will all work out for the best.

Sep 02, 2013 06:20 AM
Anna Hatridge
R Gilliam Real Estate LLC - Farmington, MO
Missouri Realtor with R Gilliam Real Estate LLC

Very good news in the long run.

Sep 02, 2013 07:09 AM
Phil Stevenson, CRMP
PS Mortgage Lending 305-791-4874 or 888-845-6630 - Miami, FL
"Mortgage Nerd" in Miami, Florida and Texas

Anna, it's a great preventative measure and very beneficial for future consumers in the long run.

Sep 02, 2013 07:12 AM
Beth and Richard Witt
Long Island Cash Home Buyer - Center Moriches, NY
Long Island Cash Home Buyer 516-330-6940

My sister lives in Davie, Florida and I am wondering if you may help her as she is looking into a Reverse Mortgage... Let me know...

Thanks for your post which is very informative..

Sep 02, 2013 09:59 AM
Bob Miller
Keller Williams Cornerstone Realty - Ocala, FL
The Ocala Dream Team

Hi Phil, it is amazing what people will do to steal versus just earning a real living.

Sep 02, 2013 11:10 PM
Gene Riemenschneider
Home Point Real Estate - Brentwood, CA
Turning Houses into Homes

Reverse Mortgages can be great products for the right person.  But they need to be entered in to with caution and understanding.

Sep 03, 2013 05:23 AM
Phil Stevenson, CRMP
PS Mortgage Lending 305-791-4874 or 888-845-6630 - Miami, FL
"Mortgage Nerd" in Miami, Florida and Texas

Richard & Beth, you are very welcome.

Bob, yes, it's sad to see. The biggest problem is when everyone gets bunched up together because of one person's mistake. Hopefully, this prevents more of this from happening.

Gene, of course. It should always be a well thought out decision first before making any deals. Finding someone you can trust is key.

Sep 04, 2013 12:13 AM