Reverse Mortgages for Women, By Women, with Renee Konstantine

0:02 One of the challenges in dealing with real estate when you have errors and transfers upon death and such is that oftentimes the party inheriting the property or taking over ownership isn't really fully prepared for the process and needs some additional handholding. I find that oftentimes people who are older who buy or sell property are more are more sophisticated than average the person receiving property for the first time their lives maybe in their 50s or 60s in many cases are not prepared and one of the demographics that needs extra service I think is women and I'm really excited today to have Renee Konstantine who is a specialist in reverse mortgages for women by women interviewed by a podcaster that's not a woman just for to keep things clear here Renee thank you for joining us today. Thank you for having me, Bill. I'm excited to be here and very passionate about making sure women have all the information they need to move forward with a reverse mortgage if it's something they feel they want to do.

1:00 Well, as a man who's been married for 39 years to a woman, I don't think women ever get all the information they want. Just let me put that disclaimer out there for the men so expectations are set reasonably. But I do think there's a gap and I deal this as a Realtor® all the time when one spouse's passes and the one who was controlling the finances and that one is disproportionately the male who passes earlier as well as disproportionately controls the finances doesn't have to be but that's often the case. So talk about that situation and then how you trying to address that.

1:31 Okay. Yeah. Yeah. And you're absolutely right. And one of the things that actually surprised me about the book when it came out is that a lot of men are buying this book for the women. So they're including the women in this now, which a lot of the times when we deal with the spouses, I mean with two people, the men are the ones that take over. But now the men are buying the book to give to the women's because do you remember that book? Men are from Mars, women are from Venus. John Gray, one of the greatest books ever on marriage. It's [laughter] phenomenal. I saw him in person in his speech, too. Amazing.

2:07 Right. So you could tell your wife something or explain something to your wife and I could explain something to your wife. Yeah.

2:16 And I'd venture to say she'll understand what I'm saying more than she'll understand what you're saying. Yes. So, what has really surprised us recently since this book has come out is that the men are buying it to give to the women, which we didn't expect, which is great idea. You know, if I could just buy books and give them my wife and get her to do things properly, how to treat your husband better, [laughter] how to cook, that if that was what it come down to, I'll buy a lot of books and give them my wife. I think I believe there's a little more to it than just that, though.

2:47 There is. There is. And back to your point there, we have a workbook that my wife's in the next room here, so we can't talk too loudly because then she'll call me on all this. But go ahead. I'm sorry. [gasps and sighs]

2:57 We do have a workbook, a companion workbook that goes with the book that works through some of the things people aren't writing down that maybe they should, that they don't know they should, right?

3:12 The thing with reverse mortgages I find a lot of times is people don't know what questions to ask. It's like you don't know what you don't know, so you don't know what to ask. So, in the book, as well as the companion workbook, we talk about some of the questions that need to be addressed up front and where to write down the servicing numbers when you're done, what questions to ask your loan officer if something happens to one of the spouses. Women do live longer than men.

3:38 Most of the time, unfortunat Yeah. Unfortunately, I don't know if you heard, we lost one of our co-authors, Rosemarie Litoff. We're very sad about that. Rosemarie passed just before the book became live on Amazon and our goal, Kim Buckley, Rosemarie and I, our goal was to have this in everybody's hands at the Thanksgiving table. And unfortunately, Rosemarie passed. And so this was kind of a contradiction because women do live longer. And I don't know, I guess Rosemarie's up there helping us right now talk to more women about things. But

4:17 Rosemarie, she was one of my she was one of my first interviews for this podcast almost at the beginning of the year. And she also happened to be with the same firm I believe that you are, C2 Financial,

4:31 Correct? Who then got me into with your management, Shain Urwin, and some others that just helped this podcast really explode because I think you guys are really a collection of amongst the top originators in reverse mortgages in the country.

4:44 Yeah, C2 Financial has some great originators and we really value the education and training that comes through C2 and we like to pay that forward. So yeah, Rosemarie, we love her. We actually there's an author's note in the beginning of the book about a hummingbird symbol. We use that hummingbird symbol as we go through the book to note successful things that you really want to pay attention to because you know how when you're skimming through a book, you'll find things that interest you. Well, this kind of points you to those directions that the beta testers that read this book ahead of time are like, "Oh, yeah. This is really great. We need to learn more about this. So, you'll see that little hummingbird. So, Rosemarie and Kim and I always have this little hummingbird with us, which is great. It reminds us to help other women and be able to share more about things. But, yeah, back to your question about that, you know, that one spouse remaining

5:46 There. There's a lot that goes on in Look, I run the finances for my family, my wife, our my our children grow grown up, but it's work, you know, there's paying bills and there's savings and there's investments and there's property and there's deals and I have a way I track it, but that's how I track. I'm not I'm not I don't have a board meeting where I'm showing it to other people publicly. I'm trying to keep it hidden for security reasons. I want to hide from everybody but my wife. I want her to see everything but I don't want anybody else to see any of it. So reverse mortgages I think really fill two roles in this and one is it may be a reverse mortgage might be in play and explaining that to your spouse would be important as to what it means how to use it effectively. And the second would be I can imagine a lot of cases where a reverse mortgage was not appropriate before the spouse passed but all of a sudden becomes a very powerful tool to consider when it when it does pass. So let's talk about you know your piece of the niche. Obviously helping women at this time is important in the broader sense, but in the narrow sense, where does reverse mortgage fit into helping women who find themselves perhaps, you know, overwhelmed with a lot of things to do and yet needing to take effective action to manage their finances.

7:02 Well, one thing I think we need to point out is when a spouse does pass and the woman is left behind, you've got people coming at you in all different directions. You need to do this, you need to sell the house, you need to keep the house, you need to buy a condo, you need to downsize, you need to do this. So, everybody's coming at you. And I've read and heard from personal friends that you really need to take some time before you make an immediate decision

7:30 About something. So, even if somebody does come up to that person say, "You need to do a reverse mortgage. You can't afford this $2,000 a month payment. You need to do something quick." I wouldn't rush. We talk about this in the book. Do not rush into anything, even a especially a reverse mortgage. You want to know what you're doing. And that's why the guide book comes in handy because it actually walks you through. It's a are do you have a spouse? Yes or no. And it kind of it's a what do you call those little charts that guide you to a certain direction? If this then that. If this then that. And so if you get to the point where you say, "Yeah, a reverse mortgage will work for you." But then your husband passed away 6 months ago. It's like, okay, let's wait 90 days. If you still feel that same way and nothing has changed on your on your financial income and outgo, then it might be a good thing for you to do.

8:26 If it if it something has changed, if there's a medical emergency, that may speed things up a little bit, but we also have a list of questions to ask your loan officer, you know, so you're not getting rushed into it. Kim and Rosemarie and I have the mindset along with most C2 reverse mortgage loan officers. You don't rush people. This isn't a loan that is going to close. Somebody's going to make their mind up in 30 days, 60 or 90 days. It's a process. It really is. So that being said,

9:00 Probably needs to be a process. You know, I one of my one things I've learned, you know, with maturity and having made mistakes is that I and most people, we say we're thinking about something, but we never really thinking about it. We think about thinking about it, but we don't actually think about it. And what I mean by that is like in my business when I made a transition six years ago, I will say I did blot out 30 days. I said, I'm not going to make any decisions for 30 days, but I'm going to gather info and write a plan. In the end of 30 days, decide on the plan and then execute it. And I think the same's true here if you're talking about taking over your personal finances for the rest of your life upon loss of a spouse, for example, or preparing that it makes sense to just gather all the information. And that means get input from trust advisors and people that you respect and can help. Might be there when you're gone, might be there when you need help. And not make a decision like to get a loan or invest money, but put those ideas down into a plan and then you have 30 days. There's nothing that's going to happen inside of 30 days generally that you can't wait to write the right plan that can't be corrected with the right plan, right? And I think that's what you're talking about is during the time you can fill out the checklists and you can do the questionnaires and you can talk to professionals and gather information but don't get pushed into doing something because typically when we make those decisions quickly we didn't really think about it.

10:27 Right. Right. And a lot of women do have financial planners they work with these days which is great or it's a family financial planner you know so the husband and the wife are working with the financial planner and it's actually a plus. I love working with financial planners. We get a lot of referrals from financial planners and if say the husband passes then the wife's working with the financial planner. I had something like that recently where the financial call financial planner called me and said you know she's making $20,000 a month payments on this beautiful home on the coast and she didn't want to move and I don't blame her. You know, it was a beautiful home and she could afford it, but she was depleting her assets from her assets under management with the financial planner, 20 grand a month, and she had to come in with a quite substantial amount of cash for that reverse mortgage, but then she wasn't depleting her assets. So, he was able to keep working with her with a plan. And I applaud financial planners for seeing the greater picture than not

11:33 Because she left your house. Well, typically when one spouse leaves the plan really is has to be completely reevaluated. It doesn't necessarily mean everything is sold and everything is rebought. But it does mean, you know, the goals like in my case, you know, I'm making good money and support my wife. If I was to hope to live to, you know, a lot longer. But if I was to pass tomorrow, the whole plan's different now because it becomes radically preserving capital rather than where money should go and the risks have to be downgraded, things like that. And so, it's important to have that time period that you can talk to your planner, see if they're still appropriate, and maybe that's time you interview a couple other people just to get some other points of view on the subject and make sure you're broadening your information without making a decision. And I wouldn't change financial planners inside of 30 days. I just feel so much that we need to think these things through and get a more holistic answer rather than a couple quick transactions that sometimes people push towards.

12:29 I love that holistic part of your statement there. Absolutely. And well, I was on Shain's call yesterday and he talked about how the

12:40 Reverse mortgage fits in holistically to one's financial plan. And I think that's the thing people don't is really underserved is how even people with a lot of assets can benefit from having reverse mortgage if it's integrated into their plan.

12:56 Right. Absolutely. As a matter of fact, in I'm we referenced something about that. I think it's on page 95. You'd think I'd have this whole thing memorized by now about the smart ways for well-off women to use this tool. And there's estate planning, protecting investments during bad markets, living where you want, business investment chances, healthcare and long-term care planning, giving to charity, and smoothing out income, and real estate investment. There's a lot of ways you can use a reverse mortgage as a tool. It's not a last ditch effort. I think maybe people thought that in the old days because the way it started is Nelly was going to lose her home and the bank man came over and said, "How about if we her husband had passed and how about if we pay you each month, you know, like a 10-year Teen Eur hurry payment and it was great and that very first reverse mortgage I don't know if you knew this she ended up living quite a long time. [laughter] I actually when people say what's the worst that can happen I said well I feel sorry for the investor because especially for women live quite some a long time and if you if every woman on this planet got a in the United States I guess or California even got a reverse mortgage at 62 I'd say the investors probably wouldn't think it was a good investment because we would live too long [laughter] so in my eyes everybody should get one at 62 if for no the reason.

14:31 Well, now the old days they went like to 80% loan to value and then right after that housing prices dropped and there were people had, you know, more out in their mortgage than the house was worth. And the good thing for those borrowers was the client was not liable for the difference. And so it was really a very powerful tool, but it was misused a lot. And nowadays, I did a I actually was a mortgage originator and I did a couple mortgages of the I call 1.0 version and I realized it just really wasn't put together right for customers. I didn't do too many because I just didn't find it to be a really good solution for, you know, enough people. But it's different now. And I think there's a lot of protections. Talk a little bit about kind of the protections. You have a woman perhaps who never really managed the personal finances and now maybe has what seems to be overwhelming amount of assets, which is a good thing, but also could be stressful. And they have the either the opportunity or the need or the plan that includes reverse mortgage, but you don't just walk into a bank and get a reverse mortgage that next day. There's a little more of a process to help them understand what they're getting into for their protection. Talk a little bit about that protection for them.

15:38 Yeah, there is I believe it was 2014. They added a financial assessment into the reverse mortgage criteria and like you just pointed out in the old days you know if you could breathe or fog a mirror as they say it's like okay and you want a bunch of cash get a reverse mortgage and then you got the kids and the grandkids crying like what happened to grandma's money you know I thought we were getting it that kind of thing but they came up with a financial assessment and I think a lot of loan officers at first I heard a lot of scuttle bit about is like, you know, you shouldn't have to do a financial assessment. But actually, you it's been great that they did because with the financial assessment, you've got the willingness and ability for somebody to be able to understand that somebody can have the willingness but not the ability. And somebody can have the ability, but not the w willingness. I, you know, to pay taxes and insurance and maintenance and upkeep. If you got a fence falling down and somebody doesn't want to, you know, these are FHA governmentins insured loans. So, just like a regular forward mortgage for a first-time home buyer, like a FHA mortgage, they're going to check to see if the maintenance there. They're going to see if the heater works. They're going to see if the person's living in squalor or the roof is leaking, you know, all these things. So this with all these safeguards in place now and the appraisals and all of this, they do have set aides for repairs if needed. But that being said, you have to have the willingness and the ability to pay the taxes, the insurance, and the and keep it up. And a lot of people, if you if you don't have that, they're not going to get approved, which is a good thing. If one of those pieces of the puzzle doesn't work. So those are the safeguards that they do have in place for this. I'd say the appraisals may be slightly conservative, but then it's an FHA government loan. I started in this business doing first-time home

17:42 Buyer programs with CalPERS and Calsters loans and I tell my client I let my clients know that, you know, I started with first-time home buyers. Now I'm finishing with reverse mortgages, but it's pretty similar with the guidelines. So they've transposed these guidelines to the reverse mortgages, which is a safeguard, not just for the buyer, but also to the lender and the investors. I had a guy want to got a new girlfriend at the casino and wanted to get a reverse mortgage so he could take her on a Disney cruise and show her a good time. And I just didn't think, you know, it turns out that he couldn't. He owed too much money on his property. But, you know,

18:23 Hold on. The guy who was at the casino, met a woman, went in and pick her on a cruise, wasn't financially responsible as every time we That's a news flash.

18:32 I Yeah, I was having a hard time with that [laughter] one, but fortunately, he owed too much already. We couldn't do it.

18:41 You bring up a good point about the maintenance and the cost of the property because there's the ability and the willingness. I had I'm reminded of a listing I had years ago. An attorney asked me to meet with a client of his and she was having an issue with a fence line with a neighbor and it was falling down who maintains it and they're fighting with a neighbor and fighting with the city and the cost and the house was old. It was an echo park which is an older area of Los Angeles with older homes that had been remodeled but her husband passed. He used to be handyman. Now it was all flung into her and maintained. And she just said, "You know, I'd just like to sell and move to Arizona to be my sister and they have these new newer, they're probably town homes or condos, but they're being maintained by somebody else. And can you just sell us for me? I can just move." And that was a case where been perfect reverse mortgage because she couldn't have heck them for purchase and just moved right away. And I would have sold the house and we ended up selling it and she moved. That I'm just saying that sometimes we, you know, customers ask for something and we're transactional. And in this case, she wanted me to help her settle a conflict about a fence, but really she didn't even know. She really just didn't want to live here in LA anymore or she wanted to live away from her sister anymore. Her husband passed and she wanted to live with her sister. And by the way, it was an easier life by moving. So, I think these having more tools in our toolbox can help us listen to the customer more clearly and give them what they really want or need rather than just what they're asking for.

20:07 And that actually reminds me of a story. I got a call out of the blue, which how that's how they come out of the blue. I don't know how they find us, but they do. A fellow was looking for a reverse mortgage for his mom. He was in New York. His mom was in where was it? It was in Carl'sbad I believe. And he was married. He had two kids, two daughters in college. They lived in New York and the mom they were supplementing the mother's income monthly because she didn't have enough to live on. So his wife pretty much told they were this what the sandwich generation. His mom was in her 90s. The kids, two daughters in college, both the ma mom and dad worked, but the wife was feeling that the money that they were giving to his mother really was taken away from their household,

21:08 I guess, if you will. So, he wanted to know what he could do to get his mom a reverse mortgage so they could keep that money and use it for their household. So, we looked into it and then the wife actually wanted to get a heliloc because she didn't agree with reverse mortgages. So, here's a kind of a different mindset. The man had done a lot of research. He thought the reverse would have been perfect for the mom. The wife was listening to whoever she was listening to and didn't want to do a reverse at all. Want to do a heliloc for the mom. She assumed the mom wasn't going to live more than a few more years. So, why get a reverse? It's for long term, which is true. Reverses are for long term. Well, that being said, you know, you nobody knows when they're going to pass. So, your intention is you when you're getting a reverse, you plan on staying in your home. He knew the mom wanted to stay in the home, did not want to move. They knew they didn't want that their money to keep coming out. The mom, the wife wanted the heliloc. This book actually would have been perfect. He could have got one for her and handed it and she probably would have been okay. They ended up going with the heliloc and then the mom is still there and they're making payments and the reverse probably would have been the better thing at that time.

22:31 You never know, you know, you can't see into the future. But there's a lot of people getting stuck in the sandwich generation where the money is being diverted to mom or dad,

22:42 Right? Especially if one has passed. And this is becoming a problem in the household of the people that's trying to figure out how to deby out the money each month.

22:54 So anyway, these are the challenges we're faced with. And on the other hand, these are the opportunities because we're living longer as people and you have the blessing of having parents that live longer. There's the challenge goes with that blessing of how to take care of them. And so these are things that and I think in our society you know when I grew up it was more common for families all to kind of live together and you know kids would move would young married would you come into the family home and stay there or come back or mom would move in with the family and nowadays that's less common and so we have to really we have more complicated answers to more complicated situations I think. So,

23:29 I've actually had people that have moved in with the family that have had a reverse and then the kids ended up getting a forward mortgage on their own because they wanted to keep the house. So,

23:42 You know, there's ways you can parlay that as well, right? Now, one of the things that got me into this podcast was that situation but not being handled effectively. And what would happen would be mom and dad had passed. They had reverse mortgage and the heirs, you know, son, daughter, combination, multiple, [clears throat] you know, are going to take over the property, but the loan doesn't go with it. And there's different scenarios. Oftentimes, I would find they would just ignore the mail and not realize that was a warning. And then six months would go by and they would get noticed here in California for foreclosure process which now puts the property into a foreclosure and makes it more difficult to market. You get some sharks swimming in the water. And it also puts a timeline on things and I feel like this has really hurt the industry because it gets associated with these foreclosures when really the family didn't do the job of protecting the asset to be honest and then and I think also the originator not to point fingers at you personally but just to take responsibility as a professional we as an industry aren't doing a very good job of maintaining that next relationship so that asset is protected. The ultimate protection is heirs who know what they're doing and have a plan in place so that they're able to effectively refinance, sell the property, whatever they want to do with it and too often doesn't. So that's what got me into this and I get more and more cases where they need a probate in order to get control of the property to sell it to pay off the mortgage avoid forclosure.

25:27 Talk a little bit about your experience in this and how do you reach out to family or what attempts can you make to help prevent this from being a scramble at the end but perhaps make it part of the plan up in the beginning.

25:40 Yeah. It there's it's all over the board with things. Scenarios, you know, I've had I've had a place upside down on this was years ago, not recently, but years ago where they owe the loan had been in place for like 25 years or something and

25:57 It was a neighbor and they had called me and wanted to know, you know, how to sell dad's house and how much money are we going to get? [laughter] And then after doing the math, I'm like, "no." you know, he's he lived there without paying any money, you know, for a mortgage and you guys didn't have to contribute anything to. So, at this point, we just need to sell it and walk away. And they were okay with that, but it was a mindset, you know, they didn't really understand. And I think people understand they just either forget or sometimes when you know something you don't want to bring it to the surface until it's reality. It's like they did not there was three kids. They did not have to contribute a penny towards their dad for 25 years. They knew he had a reverse mortgage. He put solar on the house. He you know he did some things around the yard. It was a is a great property. But because it just it's market timing too actually. I think this was in 2010 and that's you know when the if the market's going to drop it doesn't happen very often if any here in San Diego or California but when it does happen yeah you might be upside down and then if sometimes there's kids living in the house for certain reasons and they need to move and they don't understand why do I need to move well because it's not your loan even if it was a forward mortgage if you're if they're not able to pay something that you know the bank does not I tell this people over and over again like you do the bank does not want your house. It really doesn't.

27:37 It really does not want your house. I hear it so many times if somebody looks at my car and says, "Oh, reverse mortgage. That's the one where the bank takes your house." No, it's not. You own your house. You keep your house. You live in your house. The only difference is you are not required to make a mortgage payment. You're paying $2,000 a month and now you're not. You can if you want, but you don't need to. There's a there's something that like clicks like you know when you're a math class and you're a kid and you're learning algebra and your teacher's going on and on about this and that and the A's and B's and this over that and you're like I don't get it. And then one day you're doing your homework and you're like oh my gosh I just got it right.

28:21 And when you get it you really get it. And that's why you see the loan officers that get it are so passionate about this product,

28:30 Right? And the homeowners, I have clients that are so happy now that there is a book that they can order and hand to their neighbor that they've had coffee with that they know they're struggling, but they don't know how to explain it

28:43 In a way that's going to be prying into their personal information. And this is one of those topics that, you know, if you're the child and you've been living in the house for free while mom or dad are sick for years and then they pass, like you said, it's not your house. It's the estate's house. And you might be the heir, but you need to put the work in to be able to do something. Best when they're alive, put it into an estate, transfer the property to the estate, and that way you can easily effectuate decisions upon their passing. But if not, you know, I have a, you know, reverse mortgage SOS program where we get a quick probate approval. We shortcut the process so that we can get authority to do something with the property, either refinance or sell right away. And so I try to make that available to originators as and I can work in 50 states. Have agents around the country that can help with that. But the key is communication. Like we said at the very beginning, if you're not talking about this and the book can help answer those questions, great. If you can get on the phone and answer questions with them, great. If you can meet with them, great. But you got to have some communication. Otherwise, at the end of the day, the bank is going to get the property sold to pay off their mortgage. They don't want the house.

30:06 They just want to either have some either qualifies for loan or if it doesn't qualify because they passed, they just want the loan paid off and they don't care how it happens. Then they'd love for you to, you know, sell it or they'd love for you to refinance it. They don't really care.

30:20 I think one misconception that loan officers really need to get away from and I've heard this that they'll say you have up to a year.

30:33 The investor has up to a year. I'm like, do not say that. That's I've said that. I heard that from engineers and I repeated that from us. So, can I just say for the record? Okay. I took reverse mortgage note and needed a trust form and read it and what it says is on the HECMs you have six months the lender may the word is m ay give you an extension or extensions upon request doesn't say they will you know cows may fly but they're not going to just between me and you they may I guess all things are possible they're not going to Hi. Lenders may give an extension. They're not going to. In California, it's a race to get paid off. They don't want

31:22 In my experience. Not only that, the interest is accruing. Correct. Pay with the interest if you're not if you're after six months. So, if it's average say 2500 a month, you know, after six months, that's that much less money you're going to get. Plus it's a penalty rate and fees and penalties and all kinds of other you know costs perhaps. So yeah, don't buy that. You don't have a year and six months is for the payoff. That doesn't mean they're giving you six months to open a probate, get approved. That takes about 30 days minimum, 90 days more common, and then about 30 days to sell the property and then 60 days to close escrow and pay them off. And if you're not starting their day one, you're behind from the very beginning.

32:07 Exactly. You're never going to catch it. You need a professional to help you. That's where I step in and I'm experienced calling the servicers and we have contacts with certain servicers and that's why I go to the normal event, met some services there. But don't buy you have a year. You have six months. If it says in the contract six months, you have six months. If it says you may have an extension, you're probably not going to get it. It ain't going to happen.

32:30 Yeah. And thank goodness you do what you do, Bill, because there's so many people out there that think they I've closed loans not in a trust before, even when they've had a trust, and they said, "I'll do it later." I'm like, "No, you do it now."

32:45 They won't. You do it now. And then it doesn't get done. I'm like, "No, I you really need to do it now." Yeah. And I said, "You don't want to go through probate. You really don't." I had a lady tell me I we did the loan. We did a couple of refinances back when, you know, rates were amazing and everything. So, she's set and then she still does not have a trust and she's like 97 years old and I'm like, you need to get a trust. She and then finally I got it out of her. She's got five kids. She didn't want them to feel slighted and she didn't know who to give what to and the grandkids and this and that and she just really didn't want to play favorites or anything. So in her mind it was better not to do anything. I'm like

33:34 Is that what you hear? I mean when you go into these probate situations, how did this happen? Well, there's a lot of there's a lot of situations. You know, the most common one is this one's a killer. The client finally hears me or somebody and goes to an estate planner, writes a check, does a lot of the homework, the attorney gives them the binder and says, "Okay, well, this is needs to be finalized. Take a look at it and when you're ready, let's get back together again. And they never finish the job. I have a $40 million state where the guy has a beautiful binder with a lot of information, but none is legally binding because he never signed it and didn't record the documents.

34:13 That's the recording the documents. Yeah. Vesting the trust in that case. Taking the property and moving it into the trust and then signing the trust documents. You never did that.

34:24 So, it's not completed. It's really worthless. It's a It's a fancy book because while you might say, "Well, that shows what his intention was," the judge could say, "Well, you say that, but for all we know, he looked at that and said, "No, I don't want that." For whatever personal reasons he did, we don't know. Just because that's the draft, the final draft even. And he told the attorney he's going to do it. Doesn't mean that's really what he or she wanted. And so these things now maybe you can get litigation and get it get the property moved into a trust. And there's different things you can do, but it's not it's not as it's not even as easy a probate this, but now it's litigation. And so that's the common one. The other one is, like I said, people will call me and say, "Well, yeah, we've been working on a probate, but we don't finalize yet, and the attorney doesn't know what he's doing. It's taking a while." But we call the lender, and the lender says, "Don't worry, they're going to give us an [laughter] extension." And I just imagine that service CENTER GUY HANGS UP. THEY THINK THEY'RE GETTING EXTENSION. They're not. And it's certainly not if they don't have their probate letters of authority in hand, which takes depending on where you are, you know, could take, you know, at least 30 days, probably months typically. And the letter say, well, you still have the legal right to sign on behalf of this state at this point. So that's one of those things where,

35:43 Right, you need you can take three days and write a plan out. You know, who's going to be the administrator and run this thing? Who's the attorney we're going to use? Do we want to sell the property? Do we want to keep it? How's it going to be divided? Okay. And then get started. But you better be starting on day 30 or else you're going to be up against foreclosure and that it is just creates a real mess. I'll give you one small example. So you can have a case where a buyer, let's say you're selling a property in probate and it's in that seventh month, right? Six months go by and for whatever reason they give you a notice that you're in foreclosure now. Now you might say, "Well, we're selling the house. We have a buyer and we're under contract." Now, the problem is the buyer should have been told that they can use that change of status as an excuse to cancel the escrow because you misled them. You didn't tell them the property was in forclosure and their deposits at risk or their title's at risk. And so, it's one of those things where you think you have everything put together and if the buyer maybe rates go up or the buyer gets cold feet, a smart agent will look at that and say, "Hey, here's a reason you can cancel." And they can count. Technically, the contract's invalid if in foreclosure when you wrote the contract and or the listing when you wrote the listing. So, these are all very complicated and I'm not giving legal advice. I'm saying these are all legal perils you have to wonder about.

37:02 There's nothing good that gets better in the situation. Everything gets worse the longer you take to get it done. And you should plan ahead and then execute your plan as quick as you can.

37:13 Right. Right. Definitely. Are you finding more reverse mortgages that are not interest recently or

37:22 Way too many? Way too many. It's shocking. It's just Do you think the loan officer, you know, when I started this podcast series, I was very down on loan officers for not pushing harder to get customers to get in a trust before the mortgage. Why? Because if you do it before the mortgage, now the transfer from the person to the trust is insured. It's part of the transaction and you have title insurance on it and it kind of makes it much harder to litigate that transfer. And I think it's a good it's a good thing to do. No question about it. The problem is to do an estate plan process does take months and to do it properly and shouldn't be rushed. And so if you're if you know you need the mortgage for some reason then you start that process. Do you wait to get the mortgage done after the state plan is completed? That could add time to it and drag the whole thing out. I get why originators aren't going to do that. I think that, you know, for many originators, when you have a prospect who's not ready to start the loan, that's the one you should make sure has the estate plan in place because now, number one, you create value for a customer with doing nothing more than referring them to an estate planning service or attorney. You've helped your customer. Well, if you do that enough in life, you're going to get all the business you'll ever need. And so, I think that's a good way. And second, it's a great lead follow process, which is you refer them to a state planning attorney. The estate planning attorney, you know, contacts them, maybe needs a copy of the deed. You get that for them, and then when the plan's done, they appreciate it, and now it's time to do the first mortgage. So

39:00 Is it is it is it possible to do the estate planning with just the property only even if they have other assets?

39:10 You can look, you can do the plan. You could literally write the plan not I'm not giving little advice but you can go online and get an estate plan done you know in an hour and it's just it's maybe not as well thought out or complete as it should be. And by the way you can amend it later. So, let's say that you had a lot of stocks and bonds and you didn't name them all in your plan and you get the plan done just to get the real estate done. You can come back and say, "Oh, I have a million dollars here, half million here. This goes to Betty, this goes to Bob." You can do all that later. And I don't think it's advisable to have a plan that's incomplete. But I do think you can I do think it's very viable and attorneys need to consider this. I do think it's viable to have the transfer to the trust as an insured transaction. It eliminates one more attack vector from a disrupted family member that I think you want to get rid of. And so to answer your question, for the person who's going to do [clears throat] and has a detailed estate with multiple kids and marriages and all that and special needs, even that person I think is better off with a plan than with nothing. And I ask this question attorneys all the time. My contention is 90% customers are better off with a bad plan than no plan. And attorneys will say, "Yeah, you're probably right." 10% it's a problem. You're going to create more objectors or problems in litigation. And so those people can do a bad plan and then amend it right away as a way around it. I really do believe though that you should get the plan at least the trust done in name and record the real estate there for protecting the real estate. I think it's an important thing that attorneys don't understand or push harder to get done. W would an attorney like if a loan originator realized that there was not a trust and there clearly there were other assets would an attorney go ahead and write a trust for that just to do it for the

41:03 So you know laws vary by state and I'm not an attorney giving legal advice but what I have had attorneys tell me is look we can say all the assets are divided equally amongst these people and they come back and change that distribution or we can say well these assets go to this person this you know and specify file that later. So yeah, I have a head attorney say to me, we can cover all the assets in a trust. We can say in that there's a thing called a porover. Anything we don't identify goes in the trust as well. So there are ways that you can do your best to minimize the friction there and then later come back and fix it.

41:37 So for this client that I had that had the five kids, we could have done that. I mean, I could probably call her now and have her do that.

41:47 I think you could even write the plan initially just to mirror whatever the state law is for intestate. I mean, in California, if you have five kids, it's g it's probably going to divide it equally amongst the five kids if they're all from the same spouse.

41:59 So why not just start with that and then later go back and adjust and say, well, you know, maybe Mary needs more and needs less. And you make those changes or this one's a minor and it needs to be protected differently. This one's special needs. Let's set up that. So those things can for sure you can always amend it and change those things but I do think it's important again I've asked this of attorneys every case is separate but in general 9% of people are better off with a bad plan than no plan because you can always amend the bad plan because now you have at least the t the trust name and the real property can be recorded and in most states the real property is the vast majority of the assets.

42:36 That's really good to know. Really good to know. That's actually changing my whole origination strategy moving forward now. Thank you. I appreciate

42:44 I would say to you also though you need to develop a couple different estate planning resources. I there's like the online inexpensive resource. There's kind of the basic bluecollar estate planning attorney local kind of person and there's more sophisticated wealth management type estate planner. And then get their opinion on the subject and make sure you're in alignment with them on that. And I would say

43:09 You have resources, correct, for all this. I do. I do. And I think, you know, and I have attorneys I've interviewed in San Diego, for example, where I know you're located. So I think it's important to have multiple resources, multiple locations, male, female, different languages. Is I mean as a as a professional my I'm always looking to meet good I'm looking to meet great estate planning resources to put in my rolodex for my clients because I refer out to a lot of different people I think it's important at least my strength is find the right person rather than because never really give me business as a result of my referrals I get business and some of them are from them but I that's not why it doesn't great estate planning attorneys aren't going to give you a real estate to sell because you're giving them business they're going to give it to you because they know you're a great Realtor® because that's why they're great at their job and that's really what I want to do.

43:57 You me you mentioned special needs trust. I had actually never heard of a special needs trust until I did a reverse for a client that had a special needs trust.

44:08 And at that time, this was a few years back, at that time they were not closing loans in special needs trusts. However, as of I believe it was 2025, they do now. The lenders do now,

44:23 Which was a big relief because they had to go ahead and take it out of the trust at the time because they weren't doing it at the time, right? And then when we went to put it back in, they wouldn't do it, of course, because at the time they wouldn't do it. But then the law changed and they did it, so it was fine. But I it's really important for people to know that special needs trusts are accepted now with the lenders. Well, all trusts that all trusts have gone through that transition. I was the originator in the first part of my business in the early 80s and in those times l we made customers take trust property out of trust and deed it back in. And then there was a time when we would review trust for a fee and that was a nightmare because the companies just didn't really accept the process and really want to do that. And as originary you would just say just it's just easier to deal it out. But we created this whole cottage industry of people who had a property in a trust, took it out, and forgot to put it back in. And there's a whole industry in California to try to rectify those mistakes because they really were mistakes in most cases. And so I tell people, and even today I'll hear lenders will advise the customer to either get the loan, their name personally or to buy it personally and then deed in after the close of escort. No, that's wrong because a during the time period you're not protected. B is not insured necessarily when you deed it in unless you buy a separate insurance policy that you're paying for when you buy the house. And so I think it's really important to whenever possible push the lender to be able to make the loan to the entity that owns the property already, which is if it's a trust, it's a trust. They own the property if they qualify. Now, special needs trusts are going to be difficult to qualify based on the asset profile they might make it or not. But it just depends on the circumstances.

46:12 There's ways to make that work, too, though. Yeah. So, it ended up working out, but I actually lost sleep over that loan because I was nervous that they took it out and how were we going to put it back in? And thank you, Jesus. The law changed. [laughter]

46:28 Yeah. Yeah. Again, I think for all for all of us, the law changed, allowed us to take advantage of It's so interesting how the legal process works because the people make the laws. Think about how careful you and I have been on owner occupancy issues over the years. You find all these politicians are just flouting the law. None of them go to jail. None of them get the loan called, you know, I don't know about you, I would be sleepless thinking about, you know, some fraud. You know, I had friends in the office who got arrested for doing fraud. And these rules that they make that made no sense. The deed property out of the trust to let your deed back in just was nonsense. Doesn't make sense.

47:01 It was just lenders being very lazy. And I think as originators, we have the power to change it. It's not our money. You know, we're employed by them or we're contracted by them. So, we don't really have the input. But politically they I think Fannie and Freddy and FHA forced that change and now lenders do will accept the property in the trust in most cases. So

47:21 That's good. That's good. Well, look, I got a little long here with you. I'm not paying you by the hour, so I need to let you go. It's been a pleasure to learn about you, to learn about your book and your team. Shout out in memory to Rosemarie Litiff who was a great resource and like I said got me started off with C2 and I know at the time you guys were talking about the book. Book. I think you were just getting ready to launch it. When I interviewed her, I think beginning of the year, so it's nice here at the end of the year to again talk about your book and it's reversemortgages forwomen.com is the website and then the screen below I have all your contact information. You are a certified res reverse mortgage professional with C2 Financial. Renee Konstantine at onegmail.com is the email as well. Rene, thank you so much for joining us and thank you for talking to the industry and to the women of [clears throat] of the reverse mortgage world.

48:12 Thank you, Bill. I really appreciate it. And for the rest of you, this is Reverse Mortgage Podcast. We get together every week and issue a new episode. OB most commonly with reverse mortgage originators, but also vendors, management to help us be better at our business. Whether you're a Realtor®, attorney, mortgage professional, love to help you get better at your craft serving your customers. If I can help, you can reach out to me at Bill Gross Probate on social media. If you like this, please like or subscribe. Send me questions or comments. If reverse mortgage specialist, you want to be interviewed, send me an email. Let's talk about it. As always, make today your best day ever.