Unleash the Power of Home Equity, with Matt Harrison of Movement Mortgage

0:02 On his website. He says, "Unleash the power of home equity." Matt Harrison with Movement Mortgage is a reverse mortgage professional who focuses on reverse mortgages. And has some company designations. We'll talk about a little bit. He's been on the podcast before and I invite him back because he's an expert. Matt, thank you for coming back to us.

0:18 Oh, thanks, Bill. Really enjoy being on again. Now, I know there are companies allow people to do both forward and reverse mortgages. Some companies don't and want you to take the lane either way. Talk about your position at movement, what that means for somebody coming to you with questions on reverse mortgage as opposed to just any other originator.

0:35 Yeah, know I think that's a great question. You know, I think it really just comes down to an analogy that I share with a lot of people. You know, if you have need, you know, let's say you blew out your knee, okay, and you need to have reconstructive surgery on your ACL,

0:52 You're not going to go to a general practitioner doctor to help you with that. Right now. They could probably work it through and maybe you'd be okay, but I don't know about you, Bill, but I would be going through to an orthopedic surgeon, right? Someone that has really taken their career to study knees and know everything there is, you know, to know about it. You know, in the mortgage space is very similar. You know, there are your general practitioner type mortgage originators. I used to be one kind of a jack of all trades and you know did everything from conventional to fha, va, usda and then you dabble a little bit here and there you know enough to be dangerous and with the reverse program what I've you know come to know is that this is a program that is unique. It is special. There are a lot of facets to it that you can't just do one or two a year and you say that you do them. And here at movement it's very you know very different from a lot of companies. We have nine dedicated reverse mortgage professionals and as retirement mortgage professionals what we do is reverse. You know it is all we do. So we've really honed our craft. A lot of our days are spent not only doing loans but helping financial planners, real estate professionals, CPAs, estate planning attorneys, divorce attorneys, and so on to learn about how this program fits within an overall retirement strategy.

2:29 And you know so that's where the fun comes in for us and why I've decided to do this as my career you know over the past five years you know versus something that is misunderstood but once people understand the benefits of it can really turn someone's retirement around and you know no longer is this a program where you kind of hang your head and say yeah you know I had to do a reverse mortgage because I didn't plan well the reality is I will do a reverse mortgage because I am planning well.

3:03 Well, and I think both are both could be true, right? The people didn't plan well who have to have one. Other people who plan well and get to have one and those are different on the spectrum. You know, I don't want to make an advertisement for movement though I've worked with Movement Mortgage for a while and they've been a great company to work with and I really kind of appreciate their values as the company. I feel like you're one of the few companies that has certain values and you ride those till you die. The separation of reverse versus forward or standard mortgage reps. I gotta say MO movement mortgage must have hundreds of forward mortgage reps. I know I've been in a room at a regional rally with hundreds. How many you think nationally are there? Do you have any idea?

3:42 Oh, you know what? As far as the number of LO's, you know, the companywide we have I believe we're at 4,000. I might be off on that, Bill. The company's always growing. Right to me.

3:56 And so I think the point I want to make was notice what mortgage what movement is saying is that a 4,000 reverse 4,000 mortgage originators nationwide at one of the I think one of the premier mortgage companies in the country and it's not even arguable. They're one of the premier national companies. They're saying only nine are certified to do reverse mortgages. The rest should call you and work with you and you could as a customer they can still have relationship but they don't really know the technical part of the loan and so I think when you look at nine out of let's just say for sake discussion 2,000 just to be conservative imagine a regular originator that you know what the odds of them knowing anything about reverse mortgage and the problem is in my experience they'll all say they do them every mortgage originator I've ever met will say they do FHAVA conventional first time buyers, luxury homes, but if you do all those, you can't do any of them. Well, it's just too hard to imagine. So, that's why I know that on my podcast, I've interviewed really only people specialize in it, whether they be CRMPS or who are certified or reverse mortgage or reverse mortgage professionals where you're both certified and limited at your company as to who can do that. I think it's a real testament to movement and I think it's a testament to you as a professional to say okay I'm going to focus on this and do it well and so you know I know I see those who don't do it well in your case there must have been a cost right at some point you gave up doing the conventional mortgages to do the reverse talk about your decision to make that choice because I think I think it was the right one I don't know enough about you to make that judgment but I just my guess is I think that always focusing on something gives you a has to create more value for customers.

5:38 Talk a little bit about that decision that you made. I'm sure you had some trepidation and how's that worked out? Yeah, that's a great question. You know, I've been in the industry since 2001. You know, I did real estate for 14 years. I've been doing lending ever since. And you know, I was you know, I've done it all. I was a branch manager. You know, I had a team underneath me and again, we did every loan, right? And it was a part of being, you know, I've always looked at myself as more a loan strategist. I like the planning aspect of it. I didn't look at my job as just, hey, I'm in the business of just selling loans. I really saw it as a way to help people to invest in their future and, you know, provide a cash flow through, you know, real estate asset wealth, right? And so how I got into reverse initially, my dad had a had a home that he wanted to sell and he wanted to buy something different. And he was over 62. And you know, like a lot of 62 year olds, they say, "Well, I've got this equity in this house I have right now, and I want to move into something different." And for my dad, he wanted to upsize into a newer house and with a pool and all the bells and whistles. The issues that came into play were for him, how is he going to do that? You know, was he going to buy it cash, which he could, you know, he could have taken money out of his retirement plan and taken the money from the sale of his house and combined the two and bought this home, but that's liquidating a lot of liquidity and putting it into an illquid asset that you can't really touch. And during retirement, it's important to have that liquidity and cash flow. So my dad says, "Yeah, I really don't want to do that." He wasn't excited about a monthly payment either, you know, to get a normal traditional

7:29 I wonder why. Who doesn't want to pay a bunch of money to the bank every month? Well, let's think about this for a minute. What could be wrong with that? So, here's the big question. And I talked to a lot of people right now that say, "Hey, Matt, I've got like a 2.5% interest rate. It's amazing." Say, "Great. There's nothing wrong with a 2.5% rate and you're making a payment. But I have a question for you. If I was your financial planner and I came up and I said, "Hey, I've got a great program for you. I want you to give me $2,000 a month for the next 30 years and I'm going to put that in an illiquid asset with 0% growth. How excited are you to actually give me money?" And of course, everyone says, "Well, not excited at all. That would be a horrible plan." And I said, "Well, that's exactly what we're doing when we're making a mortgage payment. We're taking money and putting it into an illquid asset, which is our house, and it has a 0% growth rate on the money we put in. Now, the house value grows

8:36 Or decreases in value based upon what? Appreciation, inflation, and appreciation of homes. But it at the end of the day, Bill, it's the market, right? What is someone going to come in and pay you for your house? That's the value of your home, right? So, that is what is building the amount of money that you put into this. Now, yeah, you can say, "Yeah, I put money in to make it better and improve it and do renovations or whatnot," but the reality is that market value is going to be dictated by what the market is doing on that home, right? So, my dad wasn't excited about making a payment obviously and I said, "Dad, there's another option

9:20 That's available." But at the time, Bill, I didn't know about reverse. I was the jack of all trades mortgage lender and I'd heard about it in like meetings, you know, in back rooms. They say, "Hey, you know, reverse is an option, but I didn't understand it." So, I went to a professional in our in our company back then. And I said, "tell me about reverse." And he got a big grin on his face. He says, "Okay, this is how this works." And for my dad, I'll just give you the numbers. You know, it was a $620,000 home that he wanted to buy. And if he used a reverse mortgage as his financing option, he had to bring in about $380,000. So, he brings in 380, the reverse mortgage loan brings in the rest, and he was able to buy that home. And so, I took this information to my dad and said, "Hey, this is how this works. You can buy this new home that you want with a pool and everything for 620 and all you have to bring in is $380,000. Beautiful.

10:22 And he said, "Okay, what's the catch?" Which is a very common question, Bill, that we get. Like, there's no catch. This is an FHA insured program backed by HUD. You retain title to the house. You can make optional payments if you want to, but you don't have to. You still have to pay property taxes, homeowners insurance, maintain the property, keep it as a primary residence, but you don't have to make a monthly mortgage payment. And he said, "Why would I not do this?" I said, "Dad, I don't see any reason why you shouldn't." And after he closed on it, he said, "Matt, why doesn't everyone do this?" And I kind of looked at him and said, "Dad, I've been in the industry now for over 20 years, and I just learned about this program." again to highlight the fact that I think as an industry bill, we have done a very poor job

11:11 Educating the public on what this program is and how it can be used because everyone thinks that the only reason that you would do a reverse mortgage is if you have run out of money and it is your last option. And as you said before, it could definitely be used that way, but the very best way to use it is at 62, start it as soon as you can and let the safety and security piece of that reverse mortgage start to build for you.

11:43 You know, I'm embarrassed to admit I launched this podcast. I like to say, and it's true, to help educate people, but part of it was me. I was talking to a colleague who happened to be a first mortgage guy saying I was thinking of moving to Florida and I wasn't going to sell her house so I didn't have all the equity but I had about a half million dollars in cash to buy a property but I wasn't finding much and I wasn't going to move my whole family. I was just something big enough for me to live in and work out of and be comfortable there and then maybe come back here five months a year or something like that. And he said why get a verse mortgage for the difference? You could buy a bigger house. I thought what do you mean? And he said, "Well, instead of $500,000 house, you probably buy five, you know, an $800,000 property." And I thought, "Huh?" And there was nothing for five. For eight, there were some condo options that made sense for me that now I can't move unless I'm willing to get divorced and I can't both get divorced and buy the condo. So, we're not going anywhere. But my point is, I'm in the business. I didn't know that. And I realized that there's a tremendous opportunity for people to use this very powerful tool. I know in talking to you mentioned I think there's four different types of customers. There's the one that needs it. They have a house paid free and clear. They have no other income. They have no other credit source. And this is a way to unlock some of the either lumpsum cash or monthly payments or a line of credit to pay expenses. So, that's one case. What are the other common cases of people using this tool to help benefit themselves financially, not out of desperation, but perhaps out of motivation to improve their situation?

13:16 Yeah, great question. So you just mentioned the first group, right? If you have a house that's paid for, free and clear. First off, congratulations. You know, that's an awesome achievement to have a paid off house and you own asset, you own a land, you know, that's that is a great achievement and there's nothing wrong with that. However, I'm in the camp that firmly believes that there is a more efficient way to do it to where you can open up a line of credit within this home that you have and through a reverse mortgage. Now, you might be saying, "Okay, Matt, but I can I can get a line of credit with a home equity line of credit from my bank or credit union." True, you can. You can do a cash out refinance as well if you can qualify for it. But both of those carry their own issues. Any money that you take out, you have to make a payment back on. And so while it is a upfront benefit to have that money there, when you start to need it or draw on it or you'd like to, you now have to make a monthly payment back on it every single month. The other issue that kind of comes into play with a home equity line of credit is that it doesn't grow. It's set. Here it is. And not only that, but if something were to happen in the market and let's say the value of the home dropped, that home equity line of credit is no longer accessible to you. We saw that in 2008.

14:42 Or if the house burns down, you don't have access to that money. Whereas with a line of credit within a reverse mortgage, you can have access to that line of credit, you know, and it continues to grow and build for you. You know, you look at the people that were in Malibu that lost their homes. That they had a reverse mortgage on them and had a line of credit, they still have access to that money while the home is being rebuilt. A lot of people don't know that and don't understand it. So, if you have a paid off house and you don't necessarily need cash flow, now if you do, a reverse mortgage is a no-brainer. But if you don't need cash flow now and you start a reverse mortgage, what that is going to do for you is you're going to have a line of credit that now starts to grow and build and build and build so that if Bill you ever need it, you can touch that money and draw it and it becomes another source of income. And who knows what happens between 60 and our 90s if we live that long. There's a lot of things that can happen in this world and to have another bucket of money that's available to you

15:47 Is absolutely priceless, right? So, the best time to get a loan is when you don't need one. I mean, you can qualify for it. Mark's generally good. That's the time to get this, you know, integrated and started. So, that's group number one. Group number two, maybe you've got that $2.5% interest rate and you're making a payment and let's say that payment is $2,000 a month and maybe you only have, I don't know, eight years left on your mortgage or 10. You're like, "Yeah, I'm getting close. I'm going to pay this off." Right? My very first question would be, could you find a better place to put $2,000 a month for the next eight to 10 years? And that's one people have to think about for a minute because, you know, they're used to making this mortgage payment. They've been doing it for a long time. But if they could put it somewhere else that might be more efficient, would they do it? Because we can do three things with money. We can spend it, we can save it, or we can invest it. Spending it is easy. Saving it's also pretty easy, too. Been investing it. Okay, we got to put some effort in that, right? To kind of put it where it needs to be. But if you make a mortgage payment with that money, it counters the cash flow piece that is so important in retirement that we have to have. You have money coming in and money going out. Well, if you don't have to make a $2,000 a month payment,

17:20 Right, in this example, you know, your payment individually is going to be what it is. But if you don't have to make that payment, even if it's just $500 a month, could you find a better place to put it?

17:32 Yeah. Yeah. Yeah. And I think that there's flexibility too with this, right? Because you don't have to put the money into the mortgage. You can put some investment program. And who knows what you know comes of that over time rather than hopefully gain more than you know it's a there's a challenge. You have to get a yield that exceeds the cost of the money. But there are times that happens. I mean I you know I have investors who have lines of credit. They borrow the money, buy a property for cash and refinance and put the money back. It's just a cheaper way to close and they can you know buy at a discount say for 5% compared to somebody else. So have that money available to you is fantastic asset. It is. It is. And there's again a lot of places to put the money. And we have some fun software and we again with any clients that we work with, we go through this so that they can understand again there's nothing wrong with the pathway that they're on, but is there a more efficient pathway to look at that can provide them more cash flow in retirement and potentially more safety and security that comes with that? Right? So, that would be kind of your second group. Bill is, you know, we've got a house, we're making a payment. You know, that third group again would be my dad. You know, they're just in the wrong house or they might be in the right house. There was nothing wrong with the house that my dad owned. It just wasn't what he wanted in retirement. He wanted to have something bigger, better, you know, with a pool and all of the bells and whistles. And to do that, to get into that next home, there were multiple options in front of them. Which one was the most efficient?

19:16 Well, buying it cash wasn't, even if he had it 100%. Like, does it make sense to park all of your money into an illiquid asset over 62? In my mind, the answer is no for multiple reasons.

19:31 Well, home one or two% per year. So, you're going to get one or two% of your money. You'd be insulted if that's what the bank gave you. You look for a better alternative. And so, yeah, cash putting in cash is convenient and comfortable, but not effective use your money for sure. Well, and you look at you know, we talk about and I'll hit this briefly with a big asterisk. I'm not a CPA, not giving tax advice today at all, but when you look at the idea of stackable deductions, I'll kind of unpack this, right? You have a mortgage. If you have a normal forward mortgage and you're making mortgage payments, at the end of that year, you're going to get a 1098 tax form that's going to say this is how much interest you paid, right? And depending on how you're doing your taxes, that may or may not help you around tax time. But if you have a reverse mortgage and you allow your loan balance to grow a little bit or a lot, and you decide to be very strategic about when you make a payment and for how much. Now remember, making a payment on a reverse mortgage is completely optional. You can make one if you choose, but you don't have to. But if you do make a payment, three things happen. First, your loan balance drops by whatever you paid. Second, dollar for dollar, that money goes into your line of credit where it's liquid and growing for you. And third, you may be paid some interest. Any interest paid, you get a 1098 tax form at the end of the year. So, fast math on this.

21:05 Let's say that your mortgage has grown by about $50,000 and you have money that comes in. Maybe it's retirement accounts, maybe it's, you know, from a business or whatnot, but you have 1099 income that comes in,

21:22 Right? And you decide to make a $50,000 payment on your reverse mortgage. Again, three things happened. Your loan balance decreases by 50K. Your line of credit increases by 50K. And just maybe, if you time it right, you paid about $50,000 of mortgage interest. You get a 1098 tax form that's going to show how much interest you paid. Now, we don't know what tax laws are going to be in the future, but if there's a benefit to that, it's something that is good and fun to look at, right? So, you know, you have many people that don't need a reverse mortgage to survive. And I would say a good chunk of the population that we do these for on regular basis. This is not their last ditch effort, but they're looking for ways that they can be more efficient with their money.

22:16 You know, I'm in a sense that I have a couple things that happened this year. I've had a great year and I had a property I flipped ordinary income and I had a couple large transactions that would have gone last year going into this year. So my income this year is inflated and if I had you I'm looking for different options where I can I have cash so I'm looking for ways are there ways I can dollar for dollar invest in something that lowers my tax by that amount and obviously one that you know lowers my interest as well as lowers my increases my line of credit ability to get it back is an attractive option. So, it's one of those things where, you know, when you do your urine planning, you should look at that and that's maybe one way to, you know, capture some tax advantages as well as the other parts. Wow. Nice walk through.

23:01 Yeah. And a great again plug for making sure you've got a good CPA. Yes. That understands the reverse program. I spend a lot of time educating CPAs as well on kind of how this works so that they can start to integrate it in with their clients. And really, Bill is kind of going back to why I decided to make the change into reverse. It was about seeing a need in, you know, in our economy and with, you know, the people that, let's be honest, are really needing to have some extra help, a lot of them. And, you know, this program checks a lot of boxes. And again, it's a program that's very misunderstood. So I looked at it as a great opportunity to be able to help more people understand and you know see if this is a program that is going to fit well for them. You know once they get through the fear of what a reverse mortgage what they think it is and again fear is an acronym. It's false evidence appearing real. We see a lot of things that are online that, you know, and even some, you know, personalities that, you know, that do other podcasts or YouTube channels or whatnot or radio shows, they really don't understand the program. And again, that goes back to making sure that they're talking to the right professionals that do that can help step them through what this looks like.

24:27 One of the things you talked about last time that was, you know, really interesting to me and I need to rehear it to really understand how to use it is the life expectancy set aside, which is a way that not only do you not make a mortgage payment, but you have the opportunity perhaps to manage the payments for property tax insurance. Talk a little bit about the LIS or life expectancy set aside program.

24:51 Yeah, great. So the LISA life expectancy set aside you we love acronyms in our field of work right? Sure helps confuse the customers.

25:00 It absolutely does it confuses us. So you know that makes you feel any better. What a Lisa does if you think about it this is going to be a set aside of money. And maybe it's a part of your line of credit. So let's just give some easy math. Let's say the line of credit for a client was $100,000 and let's say that the property taxes and insurance payments for that client were $3,000 a month. Well, depending on how, you know, how much life expectancy is still there for the borrower. You know, if someone's in their 80s, they may only, you know, we're going to take this out, maybe 15 years. If it's someone that's in their 60s and doing a reverse, we've got to plan for a little more time. But there's going to be a sum of money out of that line of credit that's going to be pulled aside or set aside that will then pay for property taxes and insurance for that borrower for usually decades in the future. Now, it is finite. There's only a certain amount of money that's there. And once that runs out, then it would be, you know, on, you know, the borrower to pay for those taxes and insurance on their own. But it is going to buy them a lot of time. So basically, what happens is now you've got a mortgage in place where you don't have to make a monthly mortgage payment as far as principal and interest. And now you don't have to pay for your taxes and insurance out of pocket because that money is being paid for by the loan serer as a part of that set aside.

26:42 Okay. Now, for some and most, this is an optional feature. You can turn it on if you want to when you close on your reverse mortgage. Okay. So, if you want to just set it and say, "Hey, I just don't want to have to worry about this, you know, for the next decade or two decades or however long it's going to last, then let's just get it set up."

27:06 That life expectancy set aside, by the way, has a growth rate to it. It builds and so it's growing just like your line of credit is growing, but it just is going to be used for taxes and insurance. So, it's optional for most. Now, for those that are credit challenged, you know, let's say that you're just out of a bankruptcy or you've had some u you know, some unfortunate things happen that have derailed your ability to make payments on time. A life expectancy set aside you know, something that's obligated on this particular loan when you pull it out. The nice thing though is that for most people, having a massive life event like a bankruptcy or, you know, really poor credit for whatever reason, it's not going to disqualify you from being able to do a reverse mortgage. So again, it depends on the math. All right? And it's probably good to talk about, you know, what clients work well for this and which ones are going to kind of struggle a little bit with being able to get into this program. Well, you have to have enough equity position in your home. And that position is really going to be dependent on what your age is.

28:27 So, if you're 62 and let's say that you've got a million-doll property, you probably have to have about a 70% equity position in your home in order to do a reverse mortgage without having to bring in money. Okay? Because again, you've got your total available loan, here's your value, and the reverse mortgage is going to provide you this. Now, as you get older, let's say that you were 72 or 82, the amount of money that's available in the reverse mortgage will increase because your life expectancy isn't as high, right? And so, there's more money the older you are, but it makes sense to start a reverse mortgage as young as you can. And that's because that line of credit that's 300 grand once you start it, okay, for this million home in this example and the borrower is 62, the homeowner is, and they do a reverse, that $300,000 loan, sorry, line of credit is going to start to compound and grow and it will build and build and build. So, by the time that client is in their 70s and 80s, there's projected to be between 1.2 and $2 million sitting in there in that line.

29:51 Wow. That's an awesome amount of money to be able to have just in case. And keep in mind, Bill, that line of credit does not become a part of the loan balance until it's drawn. So, if you never need to use it never has to be repaid back,

30:07 Right? You know, so you've got a very low loan balance in that in that scenario that would eventually need to be paid. And again, to go over the big fears about reverse mortgage, the bank does not own your home. You do as the borrower.

30:24 You got to say that like 10 times, right? Every podcast. Yeah. The bank does not own your house. Okay. No more so than any lender does when you have a normal mortgage on it, right? There's just a lien on the property and you can sell the property if you want to. That's another one I hear is, "Oh, Matt, if I do this, what happens if I have to move?" Well, you list the property for sale and you pay off the balance. And again, we'll go through this is where the value should be. This is where the balance is. You list it for sale, you pay this off, and all of the equity is yours. You take it with you. You know, when you pass the heirs of the estate have, you know, the house and they have to decide if they want to keep the house or not. And that's really simple, too. If they want to keep it, they refinance or pay off the loan balance and they can retain it. If they don't want the house, like for example, with my dad, I don't think there's a way because we're a blended family, there's no way we're going to be able to keep this house when he and my stepmom pass. So, what will most likely happen is we will list it for sale. Will pay off the mortgage balance. The remaining equity position will then be divvied, you know, for the estate.

31:33 So, one of the things that drove me into this area as well is the end of mortgage stuff. We just talked about how it is how you just sell the property. The challenge I find is oftentimes mom and dad pass.

31:46 Kids don't know anything about this and all of a sudden they know there's a foreclosure posted on the house or comes in the mail and they panic because they didn't know there was a reverse mortgage or they didn't think about it or they assumed that they could keep it forever. Talk a little bit about how you prepare your customers for those end of mortgage resolution options ahead of time and then when you get that panic phone and I have a product I call reverse mortgage SOS where people call me in a panic particularly they have a trust now you have to in some cases do a probate and that's where I step in and help get the right resources or we pay off the loan I get them a quick loan to pay off the loan talk a little bit about though how you prepare your customers for that inevitable we're all going to pass at some point and what the end of mortgage process should look like based on that.

32:37 You know, that's a great question, Bill, and you know as well as I do. Most people are kind of like ostriches. We just kind of put our heads in the sand and then, you know, we don't prepare well, you know, especially for end of life things that most likely are going to happen to us. And I guarantee you, unless you're a very special person, you are going to pass at some point in your life. Very special.

33:01 Very you have to be very special. I ask somebody like that, you know, when you Okay, as a almost 50 year old and I look at my parents, okay, so there's anyone out there that's listening to this and you're in your 30s, 40s, 50s, and you still have living parents, okay, and maybe grandparents. Do they have a plan? Ideally, I'm a huge believer in having a living trust. It makes things so much easier for the estate. Having a mother that passed away in her mid50s and it was a shock to all of us and having to go through that. I know the benefit of having a trust and how much easier that makes it. Most people don't plan that well though. Most people will, you know, hopefully have a will or something written on a napkin. But there's a lot that don't. And if they don't, obviously, Bill, as you know, I mean, that's where it goes to probate. It's costly. It takes time trying to figure everything out. You know, if there's kids involved, it becomes a mess as far as who gets what and all of that. And so, if there's anything that I could give as far as a word of advice, if you don't have a trust, get one. Put one in place. It is beautiful. It usually is very coste effective and it makes things super simple for the kids at the end.

34:32 All right. Now, the reality is most people are not going to have a trust. But if you do, can you have a trust, have a reverse mortgage? Absolutely. The trust can own the house. The borrowers are in this case the trustees of the trust, you know, which would be the borrowers. And when they pass, the home is still owned by the trust. Okay? Now, the loan itself needs to be either refinanced or paid off, and the trust gets to decide that, but we don't have any issues about, okay, where does the home go and to who and how does this all work, and we got to worry about the judge and, you know, the court systems to figure it out or whatnot. So the easy answer to this is when mom and dad pass, the heirs of the estate have 30 days to let the loan serer know what their initial intent is. Do they want to keep the house or do they want to sell it? They have six months to execute the plan plus two threemonth extensions if they need it. So that's upwards of a year to actually get this moving through. Okay. Now, as you said before, Bill,

35:46 Yeah, let me caution right there because I think there's a little misnomer on these extensions. These are extensions that the lender may allow or may not. They're not automatic. In my experience, the lender never grants the extension. Now, I can't speak for more from movement or any particular serer, but I can tell you that I've heard a lot of regions talk about the extensions. I've heard national speakers organizing this product and going to Washington DC talk about it but when you read the mortgage it says may grant extension and I just want to warn anybody watching a lot of things in life may happen but I wouldn't bank on the may happen I would bank on what you can get done and in six months you can get things done and I would urge you to take advantage of that because my experience is the mortgage companies just race to foreclose as fast they can at that point so I'm just that's my cautionary we can disagree you know good people can have disagreements but mine is I again it might be different with more with a movement if you service your own because you are concerned about your company's reputation most companies don't care they sell the loan because they don't care movement does care and so again I can't speak to what movement does but on the HECMs I see it says may

36:57 And in my experience the major servicers never grant the extension and that's an area to be very careful about anyhow go ahead I'm sorry

37:06 Yeah so I you know we probably will agree to disagree agree on that one. I know of you know Compu-Link that you know they handle 99% of the FHA reverse mortgage portfolio right now regularly will grant those extensions. If there's communication that's happening. Now if there's not communication that's where it comes into a problem and an issue because they don't have anyone saying hey this is what we're trying to do. We're trying to sell the property because the reality is they really don't want to foreclose. That just adds cost and time and everything else. And so that's not in their MO to do it that way. But that being said, there is a sweet spot with this bill. The sweet spot is three months. Okay, the reason I say three months is after three months, and again, this is coming directly from NAFA. All right. So, this is the governing board that really kind of helps with, you know, the reverse mortgage program and with Washington. After three months, that's when the foreclosure process will initiate. Now, generally, that process takes about nine months.

38:17 So, if you don't want as a, for example, I'll just go back to my dad. So, when my dad passes, we're going to want to figure out what we're going to do and get it done within three months. Why? Because as the kids, we want to maximize the total benefit of whatever's left in the home. Now, there's going to be equity there. So, we know we're going to sell it. So, it would behoove us to get it listed for sale as soon as possible and get someone to come in and get an offer in and get this thing closed. Why? Because at three months, the loan serer is going to start the foreclosure process. They're going to actually push that button which is going to now start to add additional cost to the loan as far as attorney fees and all of that stuff to actually get a foreclosure post through. So three months is the sweet spot. Now how do we prepare our clients? As you said before there are a lot of individuals out there that are in the business of selling loans. I really don't see it that way. I see that my main role is to help educate not only the borrowers but the kids on what this is going to look like at the end. And so I regularly will encourage my clients to say, "Hey, let's get your anyone that you want that's going to be an heir of your estate. Let's get them in a meeting so that we can talk about what's happening so that you understand, hey, this is not a necessarily a bad thing for mom and dad. Here are all the benefits, but this is the steps that you need to take when mom and dad pass. So, this becomes something that's not scary.

40:02 Now, just like you have kind of an SOS kit, right, for people that are, oh my gosh, we mom and dad passed, we didn't know they had a reverse mortgage. We think the bank is going to take the house or already owns it or whatnot. It's like, okay, we got to like educate you now on what your options are at this point. We also allow for anyone that has a question, whether we have originated your loan or not, please reach out to us. We will help you. We will guide you through any questions that you may have. It's completely free. We just do it as a service, you know, so that you know, can make your way through after, you know, your last parent has passed and kind of help you understand, you know, what those options look like.

40:47 And that's important to me and I think that's why I like working with people who are focused on this space like you are personally, Matt, as a reverse professional, and also reputable companies like movement mortgage who I've worked with. I have no interest in them, but other than I work with their professionals and I've worked with others and they definitely are a cut above and as a company you guys have a flag you plant with your values and you stand by them and I appreciate that. So definitely if you have questions on your verse mortgage getting one or if you have one and to know what your options are or your family's options are, Matt's a great resource for you. U I'll put on the screen both his website and his contact information. Phone number 800 [phone number] and you can reach matt.harisonmovement.com and then there's your website as well movement.commatty harrison. Matt thank you so much for your time today educating us. I think raising the standards is really important and I think you do that and your company does that and I really appreciate it as a professional business. Thank you so much for your time today. I really appreciate it

41:52 Bill. Thank you. Appreciate you. And for the rest of you, this is re the Reverse Mortgage Podcast. We get together every week and we often most often are with originators like Matt and other top producers. We have a Reverse Mortgage Podcast Facebook group. If you have questions, comments, looking for referrals in certain areas, feel free to go there and ask your questions and look for those referrals. We do this every week. It's on YouTube and other platforms. If I can help, please reach out at Bill Gross Probate. We have reverse mortgage SOS product. If you've if your family has reverse mortgage that has to get paid off, facing forclosure, not sure what to do, maybe you don't have a trust set up, reach out to me. I can help you find some good options to save the equity in your house at Bogos Probate. As always, make today your best day ever. Thanks so much.