Question About Reverse Mortgages

[midwestbroker]

Life settlements work if they have a life policy to settle. The people that have asked me about reverse mortgages were close to going on Medicaid and were looking for other options.

I have decided that I would work a referral system with a broker. I really do not want any part of the process, but if someone wants info, then he is the guy to go to.

 

[lifesettlementadvisor]

It seems like there are more "after the fact" horror stories about RM than there should be, but with all the RM guys I talk to, they say they only fund about 30% of the people that ask for an RM. I guess seniors in need don't mind the risk.

 

[somarco]

Most who are uneasy about life settlement are uninformed about the process. For the seller, there is very little to know. You have a policy you no longer want or need, someone is willing to pay you a sum of money for the policy.

This is a good deal.

For the investor it is a different story altogether. I would never advise a client to consider these policies unless they were bonded and offered by one of the larger LS companies. The returns can be quite nice but it is not for everyone.

Many carriers have bonded life settlements in their portfolio. Carriers like AIG have formed their own companies to purchase life policies from their own policyholders as well as other carriers.

If an agent chooses not to get involved in selling the bonded life settlement that is their choice. If they think they are avoiding any liability by not accepting compensation they are wrong. If they have in any way given advice or recommended one LS firm over another, if the plan falls apart they can still be liable.

The way I look at it, you might as well get paid. At least that gives you some income to offset legal fees.

 

[lifesettlementadvisor]

AIG got into some trouble for doing that.
You should only work with bonded LS companies, the ones that arent, are the scammers that give the industry a bad name.

Also you can find alot of shady LS stuff on craigslist
http://dallas.craigslist.org/fns/339778953.html
Currently there is legislation forming against this practice.

I have found that most agents do not have a problem taking the commissions. Sometimes agents refuse the commission because they have had a client for over 30 years.

 

[joshril]

Most states require LO's (loan officers) to be W2 employees. This is a legal requirement more than anything. Doesn't mean you have to work there full time.

A lot depends on your comp and how much involvement is required on your part.

I do 1 - 2 loans per year (not reverse, the typical mortgage) for clients when asked. Good money, about $3k per deal, but takes a lot of my time from start to finish.

I have asked about just doing a referral and the broker I work with wants me to do just as much work for a referral as I would as an LO.

I used to do some mortgage loans as well.. Right now I have a relationship with a local bank that has a fantastic loan department. They do reverse mortgages as well. I get a very small referral fee and all health insurance business comes to me. He even lets me keep some pamphlets and business cards on his desk... overall a good deal and no hassle!