Disqus - Friends of James_E_Veale_CPA_MBT

Re: Reverse Mortgage Loan Limit Increase Included In New Stimulus Plan

John A. Smaldone — Thu, 22 Jan 2009 19:06:33 -0000

Good day,

I look at this artical and it makes me wonder why our legislators make everything so complicated. Now they are talking about using a 150% times the Freddie Mac limit, maxed out at $625,000. No, $417,000 flat limit (Easy to understand)was to simple for our legislators screwed up minds. Instead of increasing the $417,000 in high caost area's like California with a max of $625,000, our great legislators have to put everyone in a tizzy again. When will it ever stop?

Have a good day,

John A. Smaldone

Re: Minnesota Attorney General Introduces Bill Targeting Reverse Mortgages

John A. Smaldone — Fri, 06 Feb 2009 09:37:19 -0000

Good morning,

My name is John Smaldone, I am in the Reverse Mortgage industry. What I see is legislators panicking. I also see and hear people trying to pass legislation on bills pertaining to Reverse Mortgages and not even understanding the product. To ad insult to injury, they do not understand the mortgage business.

It would be imposable to have a 30 day right of recession. Have these so called legislators looked into how the markets are going to price this product with a loan sitting in limbo for 30 days? I am sure they don't even know what I am talking about.

If this passes and if other states follow Minnesota, this will cost the senior dearly. The pricing of a Reverse Mortgage would have to be out of site in order to be able to hedge against market rises risks.

What are we turning into in this country. The main problem we have throughout the political arena are people with a major lack of experience. These people are running our country, our states and our lives.

Most of us that have been in the business for a long time understand the importance of fiduciary responsibility to the borrower, regardless if it is a Reverse Mortgage or traditional. The states and the federal government need not pass a bunch of new laws and regulations governing the mortgage lender, they need to enforce what they have on the books now!

Our agencies, like HUD for an example, they have not been able to efficiently enforce the regulations they have for years. They do a poor job of policing and consequently we have bad elements of people continually entering our industry.

No my friends, we do not need all these crazy bill's imposed like the one in this article. We need experienced people on committees making sound recommendations to our legislators. Then our legislators can legislate. I end by saying, the responses I have just read tells it all. I hope the state of Minnesota can receive our responses. I hope the legislators listen and use something that is being used less and less, "good old common sense".

Thank you,

John A. Smaldone

Re: Minnesota Attorney General Introduces Bill Targeting Reverse Mortgages

John A. Smaldone — Fri, 06 Feb 2009 15:42:57 -0000

Mr. Nelson,

I agree with you, your response to Mr. King was very well put. If you look at my response I think you will agree with it. I am sorry to hear about your Cardiac Arrest, I hope you are doing well.

Best regards,

John A. Smaldone

Re: Minnesota Attorney General Introduces Bill Targeting Reverse Mortgages

John A. Smaldone — Sun, 08 Feb 2009 10:24:12 -0000

Dear Mr. King,

You say you have read the proposed legislation several times. I applaud you for that. I am sure most have not taken the time as you have. However, in reading the proposed legislation I see only one thing we all have to be very concerned about. The 30 day right of rescission. Forget any other part of the proposal, good or bad, it is the 30 day right of rescission that is the only, I say ONLY item that matters here. Frank, If you read my opinion, which is fifth one out of the 10 so far, you will see what my concerns are and why the 30 day rescission period is suicidal. Please take the time to read it sir.

I have been in the mortgage industry for 40 years of which 7 have been in the Reverse Mortgage arena. I have also been a trader in the secondary market, I know what this will do to the pricing of a Reverse Mortgage and the adverse affect it will have on our seniors.

Thank you,

John A. Smaldone

Re: Minnesota Attorney General Introduces Bill Targeting Reverse Mortgages

John A. Smaldone — Mon, 09 Feb 2009 13:25:50 -0000

Beth,

I don't disagree with you, on the contrary, you are right. It is just the 30 day rescission has so many implications on a very large scale.

The entire bill needs to be taken into consideration and we must look at the implications you are referring to. I don't mean to minimize how important the other issues are in the proposed bill. I appreciate you taking the time to bring this to everyone's attention and I am sure everyone would agree with me.

Best regards,

John Smaldone

Re: Stimulus Bill Compromise Includes Higher Reverse Mortgage Loan Limit

John A. Smaldone — Fri, 13 Feb 2009 08:48:02 -0000

Good morning,

I am happy to see the lending limit increase will still be part of the stimulus bill? However, what I don't like is the fact it is tied to Freddie's index and a multiplier is used. The main objection I have to the method they are using, is that it is temporary.

Our legislators have a unique way of fleecing the American public. I see this unfolding as one of those we eventually will be fleeced on.

If this was a sincere move on the part of our governmental officials to help our seniors, they would have had a permanent, non-formula based increase. Like everything else, our great politicians know all that their is to be known about everything. They think we, the people are naive and do not see through their motives!

Thank you,

John A. Smaldone

Re: Stimulus Bill Compromise Includes Higher Reverse Mortgage Loan Limit

John A. Smaldone — Fri, 13 Feb 2009 09:12:46 -0000

Joe,

I appreciate your feed back. Lets you and I visit this situation again in year 2010. I understand what you are saying, I also admire your confidence in the system. I hope I am wrong and you are right. Time will tell, that is why I say, lets you and I visit again in 2010. Have a great day Joe.

Best,

John A. Smaldone

Re: State Lawmakers Itching to Control Reverse Mortgages

John A. Smaldone — Thu, 05 Mar 2009 09:49:32 -0000

Good day,

This is one area I feel the Government needs to maintain control, NOT the states. If this is allowed to occur it will be a disaster and the industry will not be able to keep up with all the different standards states will implement. The seniors will suffer in the long run.

We seem to either have to much control in the hands of the Government or not enough where it counts!

Have a good day,

John A. Smaldone

Re: Minnesota’s Reverse Mortgage Legislation Continues Moving Forward

John A. Smaldone — Thu, 19 Mar 2009 09:56:40 -0000

Good morning,

I understand what is trying to be accomplished for the protection of our seniors, I agree with some of what has been said in this video.

However, you can't determine what a "Need" is for the senior. It could be to improve their quality of life, not a last resort tool. We live in a different world today. Many seniors live in areas where they don't have family near by and they want to remain independent as long as they can. Seniors are getting reverse mortgages for many reasons, how can you tell a senior a reverse mortgage is bad for them if they are not on poverty road?

Predatory lending is a whole different issue, we NEED and MUST separate predatory lending from what a reverse mortgage can or can't do.

We that are experienced in the Reverse Mortgage industry and have the seniors best interest at heart do a great job for our seniors. Yes, many seniors are needing reverse mortgages to take them out of debt or give them the extra income they may need to live a better quality of life. Our economy is a mess, we have ourselves to blame for that. Many seniors are suffering today because of loss of retirement funds, cost of goods increasing, you name it.

Lets say we have the senior that is doing very well financially and may own their home free and clear. What I am hearing in this video is that a reverse mortgage is a BAD thing for these seniors, WRONG! Maybe, just maybe, we have a senior that wants to use their home for leverage. A senior may want to buy a $250,000 Boat, and they may want to take out a reverse mortgage (Tax Free Money) so they can buy the Boat for cash. What we have hear may be a smart senior. A senior who now has the $250,000 boat, free and clear, no payments on the Boat and no mortgage payments on their Home, all because of the reverse mortgage. To top it off, this senior was an accountant all his life! Are you going to say this was a BAD thing for the senior to do, I don't think so?

It is apparent by listening and seeing this video, one would think a Reverse Mortgage is a bad thing. This is out right untrue! We need to focus on the lenders and loan officers that are perpetrating fraud on our seniors. I am 100% for that. We need to look toward HUD to enforce laws and crack down on complaints and predatory lending. A lot of what legislators try and do is eliminate a program rather than cure the problem. This is happening more and more in our country because of the inefficiency of staff in many of our Governmental departments. The Reverse Mortgage problems are NOT with the loan but with some of the lenders selling the product. This is one time we need our Government to take control, not the states. We can't have different rules and regulations in each state, it would be a nightmare to control and administrate.

We must NOT make the public think a reverse mortgage should only be used as a last resort, the young lady that made this statement in the video is wrong and is doing our senior homeowners a grave injustice. Some of what these legislators are trying to may destroy a valuable source of funds for our seniors to be able to survive. Fear is what this video portrays, seniors need to be cautious but not scared to venture into something that may allow them to live a normal life.

Best regards,

John A. Smaldone

Re: Minnesota’s Reverse Mortgage Legislation Continues Moving Forward

John A. Smaldone — Thu, 19 Mar 2009 12:40:46 -0000

Good day once again,

I have read many comments on this issue. I still stand hard and fast on the comments I made which is in number six (6) above. The issue is about what the state of Minnesota is taking action on. The speakers in the video have made comments that are very good but many of the comments are damaging. If the state of Minnesota passes the proposed legislation in its entirety, this will damage the Reverse Mortgage industry beyond repair.

I do not know what the position is on the part of the Reverse Mortgage Daily Post. I hope the position will be to fight the proposed legislation in its present form.

Thank you,

John A. Smaldone

Re: Minnesota’s Reverse Mortgage Legislation Continues Moving Forward

John A. Smaldone — Thu, 19 Mar 2009 17:00:27 -0000

Dear Critic,

You make some valid points. However, do you feel we would be doing the industry and senior citizens justice is if we had, as an example, 50 states having 50 different guidelines or rules and regulations for Reverse Mortgages? I know I am exaggerating when I say 50 states. Even if it was 20 states with different rules, it would be a nightmare.

I am the last person that wants to see the Federal Government involved any more than they have to. However, what makes you think that 50 states are going to be able to control the Reverse Mortgage industry.

Do you honestly believe that 50 different states are going to think a like and be able to monitor the RM lending practices any better than HUD or our Federal Government has, I don't think so.

Each and every state has their own agenda, their own set of problems and their own way of thinking. You are now talking about having more people involved and more bureaucrats than we could ever imagine. Tell me, how many legislators and state officials do we have in 50 states compared to the amount we have at the Federal level.

You say state government is a part of life, I fully agree with you and I encourage more being left to and more given to the states. In fact I am saddened about what I foresee in our future. I see major problems ahead and see less control by the states and more and more control by the Federal Government, more than I will see in my life time.

We are on the same side in much of our thinking but not when it pertains to the control of the Reverse Mortgage industry and its seniors. As I said in my comment in number six (6), we need to enforce our laws, rules and regulations that we have within HUD/FHA.

The states have individual licensing laws that govern the mortgage brokerage industry, that is what needs to be strengthened and enforced. You will never convince me that all of our states as a whole can either design a Reverse Mortgage or control the product. The real issue here is predatory lending, why not focus on that!

You are right, in 2007 and 2008 we had many proprietary Reverse Mortgage programs in the industry. Yes, they were under the control of HUD and FHA and yes they were not monitored well. The entire mortgage industry has not been monitored properly for 20 years, what else is new. Each state was just as much part of the mortgage industry problems as the Wall Street firms, FNMA, Freddie Mac, our Federal Government and the American public. The states allowed sub prime product, they allowed option Arms, and they could not control predatory lending. I could go on and on. As far as the design of the HECM product, the states and the AG's need to stay out of that.

This is the exact point I am trying to make. If the states get involved with Reverse Mortgages, you will find states wanting to design their own RM programs. At least with the HECM under HUD and FHA we have a uniformed product with the insurance to benefit the borrower, the lender and to make it saleable in the secondary market. Now Mr.or Ms. Critic, do you also want the states to deal with the secondary market as well, I do NOT think your answer to me would be yes

I think I went on long enough with my reply to your comment. But what the states do NOT realize is the big picture dealing with mortgage products and trying to design products. This is no better than what FNMA did with their special negotiated deals desk. I am sure you will be commenting on my reply, I will look forward to it. Thank you for your frankness and your opinion, I do appreciate it.

Best regards,

John A. Smaldone

Re: Minnesota’s Reverse Mortgage Legislation Continues Moving Forward

John A. Smaldone — Thu, 19 Mar 2009 20:50:49 -0000

Critic,

I understand what you are saying and I do realize states have Reverse Mortgage laws in place. However, to reinforce what I was saying, each state varies in their laws. This is what concerns me the most, lack of uniformity.

Yes, the way I covered the landscape is what I would like to see. I am sure many share my views. The senior citizen is what is most important. These folks are depending on us and our legislatures to do what is right for them. I see only confusion down the road for our seniors looking at Reverse Mortgages as their salvation. I see our seniors suffering the most, that saddens me and I am sure it does you as well.

You are right, we need to support and expand NRMLA more than ever. Maybe we should both become Cynic's?

I have enjoyed our comments back and forth, you have expressed your points very well, I respect you for that. I do not know who you are but I would like to talk to you some day. Please feel free to E-Mail me. My address is: johnsmaldone@charter.net. You have a great evening and thank you for your reply.

Best regards,

John A. Smaldone

Re: Minnesota’s Reverse Mortgage Legislation Continues Moving Forward

John A. Smaldone — Fri, 20 Mar 2009 08:42:12 -0000

Dear Cynic,

Thank you for your reply as well as your latest comment on "Scared of Politicians". Wish we had access to a crystal Ball. I hope to hear from you VIA E-Mail soon. Take care and have a good day.

Best regards,

John A. Smaldone

Re: Minnesota’s Reverse Mortgage Legislation Continues Moving Forward

John A. Smaldone — Fri, 20 Mar 2009 17:37:28 -0000

Dear Cynic and scared of politicians,

I have read your comments back and forth to one another. If a HUD official made off the record claims to you Mr. scared of politicians by giving you information different from what we know to be HUD's position, this is serious. I am one that would like to know if HUD is shifting its position on the fundamental nature of its insurance program and I am sure most of us would.

I agree with Cynic, NRMLA should be brought into this. You need to present the facts as you know them. You will be doing a service to the industry and most important to our senior citizens. We would all stand behind you by bringing the confusion of what is or what isn't to light.

Thank you and have a good weekend,

John A. Smaldone

Re: Minnesota’s Reverse Mortgage Legislation Continues Moving Forward

John A. Smaldone — Fri, 20 Mar 2009 19:45:20 -0000

Dear Scared of politicians,

Thank you for your reply, I appreciate it. I am glad to hear you have been working on this issue. I will look forward to hearing from you when you learn more.

As far as Cynic goes, I am sure he or she has had one of those Friday's, I know I have. I think this whole issue of what Minnesota is attempting to put through and the mortgage industry as a whole, especially the Reverse Mortgage industry where we are concerned has everyone at their wits end.

This country and the mortgage industry along with the securities market is in such a mess, no one knows from one day to the next what is going on. It gets pretty bad when people who voted in such a large stimulus bill never had the time to read it?

Well, I guess enough of my ranting, you have a good weekend and you keep fighting on yourself. We have to give Cynic credit as well, he or she has put up a good fight for what he or she believes in and Cynic has made some very good points. These different points of views were very good, lets hope people have heard us.
and understand us.

Best regards,

John A. Smaldone

Re: Minnesota’s Reverse Mortgage Legislation Continues Moving Forward

John A. Smaldone — Sat, 21 Mar 2009 17:55:58 -0000

Dear Cynic,

I thank you as well. Yes I feel our discussions have been extremely constructive. You are also right on target when you say this issue is serious. It is more serious than many may realize.

I share with you our responsibility to the senior. We must be able to deliver what we promise. Our promises come from the knowledge we posses about the product we are offering. We count on HUD and our Governmental bodies that issue us the rules, regulations and guidelines. We count on these guidelines to be what they are, no more, no less. If in fact we do have the type discrepancies indicated, we are putting seniors in arms way.

I am looking forward to hearing from you with your findings. I am also very interested in learning what Scared Of Politicians can come back to us with. You keep the fight on as well Cynic, you are doing great.

My best,

John A. Smaldone

Re: Minnesota’s Reverse Mortgage Legislation Continues Moving Forward

John A. Smaldone — Sat, 21 Mar 2009 18:12:53 -0000

Scared Of Politicians,

I would like to think we are all professionals. We just want to get to the bottom of the issues. Up holding our fiduciary responsibility to the senior is number one, this is why we have so many comments on this topic of the Reverse Mortgage Daily Post.

All of us that truly care want to be able to avoid violating the HERA cross selling rule any way we can. If you can help in any way, we would all appreciate you for it. Scared Of Politicians, you have a great weekend as well.

Best regards,

John A. Smaldone

Re: Minnesota’s Reverse Mortgage Legislation Continues Moving Forward

John A. Smaldone — Sun, 22 Mar 2009 19:07:32 -0000

Dear Critic and Scared Of Politicions,

I have been involved in the Reverse Mortgage arena for almost eight years, I learn something new each day. I do not mean to sound ingnerent but I never knew of any limit on a LOC? I ask You both to please or any one to guide me to the motgagee letter or ruling that outlines the limit in detail, I would appreciate it very much.

As far as the LOC being sold improperly, I agree, many do not realy understand an LOC properly. Apperantly I am one because I was not aware of any limit or cap on the LOC.

What I am about to say is my opinion, right or wrong, any one reading this, be the judge. An LOC can work in behalf of a senior in many ways. You have the Medicade issue, debters going after the LOC amount ETC. The LOC is protected. However, I do not nor do I advocate the sale of an LOC as or have a simularity to a CD or savings account. The growth rate is only a method used to grow the amount of the LOC, based on actuary tables. It gives the borrower more money available to borrow as time goes on. The borrower sees the LOC grow each month when thay recieve thier statements from the servicer. This is the only way I know how to describe it.

I am always open to sugestions on how it can be described better or if I am wrong, I welcome my colleagues to correct me.

Any help you can give to better understand the LOC issue will be humbaly appreciated. Have a good day.

Best regards,

John A. Smaldone

Re: Minnesota’s Reverse Mortgage Legislation Continues Moving Forward

John A. Smaldone — Mon, 23 Mar 2009 10:31:12 -0000

Dear Critic,

I understand exactly what you are saying. I am glad you referred to the various chapters. I am sure it helped many of those that are following these comments.

The selling of the LOC has been abused by to many people in the industry. Many people are selling it as an investment tool, you and I both know this is misrepresenting what the LOC should be used for. It is sales tactics like this and those in the industry that are only interested in almighty dollar. Our senior citizens need to be able to have trust in us and not find out after the fact information was misrepresented to them. I am one that appreciates your input, keep up the good work. If you need my help in any way, do not hesitate to contact me.

My best,

John A. Smaldone
johnsmaldone@charter.net

Re: Minnesota’s Reverse Mortgage Legislation Continues Moving Forward

John A. Smaldone — Mon, 23 Mar 2009 11:10:47 -0000

Dear Scared Of Politicians,

You have good questions. I can only give you my opinion based on the knowledge I have at the present time. Please do not rely on my opinion. My opinion is based on what I know the HUD guidelines to be. If they are different than how I have interpreted them to be, my opinion is all wrong.

How I view the guidelines are as follows. Both the LOC and a Tenure payment are based on actuary tables. It also based on present value calculations. However, you are right, in today's environment, values are dropping. This affects the amount the senior is entitled to you. A home value two years ago was higher, we all know that. There again, the senior received what they were entitled to on the then based value.

The point I am trying to make is that we can't predict the future, this is why a Reverse Mortgage is unique, it is all based on actuary tables and future assumptions. Values today may be falling, values tomorrow may be rising. In short, what I am saying is that we can't look at the value today and say a senior can't have an endless rising line of credit or Tenure payments can't go beyond the actuary tables. The plain old fact is that they can receive payments for the rest of their lives and yes, they can see their LOC continually rising if never touched. If I am wrong , I stand to be corrected with facts. I don't know if my opinion helped but for what ever it is worth, you got it. Have a great day.

My best,

John A. Smaldone

Re: Fannie Mae Pricing Change Brings Higher Margins For Reverse Mortgages

John A. Smaldone — Sat, 28 Mar 2009 10:07:53 -0000

Good morning,

All I can say about FNMA's move to change its pricing strategy at this critical time in our economy is, this is ludicrous!

I can understand FNMA not wanting to be the only purchaser of the HECM. However, does Barney Frank and FNMA realize what they may have done. Not only to the seniors but the depressed Housing industry and economy.

This confirms what I have been saying all along, we have people making decisions that do not understand the mortgage industry and most definitely do not understand how serious the economic situation is in this country.

Instead of FNMA and the Barney Frank's of the world announcing the problem and pitch in to help find the alternative, what do they do? Like normal, drop a "BOMB", this time its on the Reverse Mortgage industry and our senior citizen population.

Many people in the industry are having a hard time grasping "Live Pricing". Now that mandatory deliveries will come into play, the confusion, coupled with this pricing strategy change will put the Reverse Mortgage industry in a tail spin.

Just imagine our seniors and loan officers trying to grasp all of this on Monday morning. Why doesn't FNMA and the people like Barney Frank understand this. If they ONLY held off for a while, warned the industry of the problem and tried to be part of the solution to the problem rather than the cause of the problem.

I appeal to FNMA, our legislative department heads and any one else with authority reading my comments. I appeal to all of you in the name of every senior that will be affected by this and everyone of us that are trying to do right for the senior. Please, pull back and hold up on implementing the pricing change. In fact I wish FNMA would hold up implementing the mandatory delivery requirement.

Give the industry time to adjust and hopefully work some thing out with the investment community to bring new funds to the market place. Even a 120 day or six month reprieve would help tremendously.

That is my good morning speech, I hope the right people will take what I am saying seriously and act accordingly!

Thank you,

John A. Smaldone

Re: Fannie Mae Pricing Change Brings Higher Margins For Reverse Mortgages

John A. Smaldone — Sat, 28 Mar 2009 11:30:26 -0000

Mike,

Good morning. I agree with you 100%. If you read my comments, which is the first one on the list, you will see that I do get your point. This will drastically affect every loan in process. Consequently, thousand of seniors are going to be hurt beyond our wildness imagination.

This is why I said and it appears you are saying, we need a reprieve on implementing the rate hike strategy on the part of FNMA as well as holding up on the mandatory delivery requirement.

Mike, this is a serious matter! I will go as far as saying I will be writing congressmen and senators to see if anything can be done. I am sure many of our elected officials have no idea this is happening, even though it is under their Noses. We somehow have to unite and get FNMA to retreat for a period of time so the industry can digest this as well as work toward finding alternate secondary marketing sources.

Thanks for your response on this subject, I believe it just reinforces mine. Have a great weekend Mike.

Best regards,

John A. Smaldone

Re: Fannie Mae Pricing Change Brings Higher Margins For Reverse Mortgages

John A. Smaldone — Sat, 28 Mar 2009 11:36:39 -0000

Raymond,

I appreciate your reply to me. I am glad you are going to use my response as well as some others like Mike Gruley's. Their has to be a way to stop FNMA on a temporary basis from going through with this. Thanks again and have a great weekend.

Best regards,

John A. Smaldone

Re: Fannie Mae Pricing Change Brings Higher Margins For Reverse Mortgages

John A. Smaldone — Sat, 28 Mar 2009 14:14:33 -0000

Mr. Nelson,

You are right sir. Key people at the White House do need to be informed as to what Barney Frank and FNMA is doing. We are now treading on very dangerous ground when messing with our senior citizens lives. Believe me, come Monday morning, a lot of senior citizens lives are going to be affected. Thank you for being direct on this issue.

I am going to repeat myself in what I said in one of my responses above. We all need to write our congressmen and senators Immediately. We need to do it this weekend and not put it off. I am doing exactly that and have been all morning. Lets all pitch in and be a strong unit!

My best,

John A. Smaldone

Re: Fannie Mae Pricing Change Brings Higher Margins For Reverse Mortgages

John A. Smaldone — Sat, 28 Mar 2009 15:27:16 -0000

Dear R.M. Broker,

You are exactly right, what happens when the index value goes up? Guess what, so does the gross interest rate go up and I mean it could go way up. What is happening here has years of back lash ahead of us all. More important is what this will do to the seniors. FNMA and Mr. Frank's have no idea what BOMB they are going to touch off!

All I know what to do now is to write our senators and congressmen. We also need to write NRMLA and try get them to be our lobbyist. I hope the Reverse Mortgage Daily Post can take up our banner as well. You have excellent questions R.M. broker. I only hope we will be heard.

Best regards,

John A. Smaldone