Reverse Mortgage Glossary

A report that states an opinion on the value of a property based on its characteristics and the selling prices of similar properties in the area.

A service provided by an independent third-party, typically approved by the U.S. Department of Housing and Urban Development, to make sure the borrower fully understands the reverse mortgage and reviews alternative options, prior to application. Mandatory for the HECM program and in certain states for all types of reverse mortgages. ​

An interest rate that remains constant over the life of the loan. 

Home Equity Conversion Mortgage. This is the industry term for Reverse Mortgage.  

Amount of funds you are eligible to receive from a reverse mortgage before closing costs are deducted. 

Expected Interest Rate: The interest rate used to calculate the principal limit. It equals either the 10-year CMT or the 10-year LIBOR rate plus a margin. 

The interest rate first charged on the loan beginning at closing; it equals one of the HUD-approved interest rate indices (1-month CMT, 1-year CMT, or 1-month LIBOR) plus a margin. Also called Initial Interest Rate.

Reverse mortgage interest rates are tied to one of two indexes, the Constant Maturity Treasury rate (CMT) or the London Interbank Offered Rate (LIBOR). 

A Reverse Mortgage LESA, which stands for life expectancy set aside, was introduced as part of the new financial assessment guidelines rolled out by the Federal Housing Administration (FHA) in 2014. The idea behind the LESA is to help reverse mortgage borrowers with credit challenges or limited income to stay current with payments for property taxes and insurance (which is an important requirement of the reverse mortgage program). 

Setting up a LESA involves carving out a portion of the principal limit (the total pool of funds available) into a set aside account that is preserved solely for the payment of property charges. The exact amount of the carve out varies widely from borrower to borrower because it is based on age and how much property taxes and insurance cost. 

If property charges are low, the total reverse mortgage LESA carve out tends to be low. If property charges are high (such as in areas where property taxes are high), then the LESA can be a pretty substantial portion of the loan proceeds. 

​It’s possible that a LESA can make a reverse mortgage completely unworkable. If the home has a high mortgage balance, it’s possible there isn’t enough left in the principal limit to create the LESA. In such a case the loan would be short to close, which means the borrower would have to come up with cash to make the numbers work.

In some cases, the available line of credit increases over time according to the terms of the loan agreement. 

Date on which your reverse mortgage is scheduled to close. 

An amount added to the Index (CMT or LIBOR) to determine both the Expected and Actual interest rates. The margin is determined by the loan investor.

The lesser of a home’s appraised value or the maximum loan limit that can be insured by FHA. Used in determining the principal limit. 

Under the HECM program, a fee charged to borrowers that is equal to a small percentage of the maximum claim amount, plus an annual premium thereafter on the loan balance. The MIP guarantees that if the lender goes out of business, FHA will step in and ensure the borrower has continued access to his or her loan funds. The MIP further guarantees that when the property is sold to pay back the reverse mortgage, the borrower will never owe more than the value of the home. 

Amount of funds you are eligible to receive at closing after loan costs have been deducted. 

A feature that limits the amount owed by the borrower, heirs or estate when the loan becomes due and payable to the appraised home value. For the HECM program, non-recourse only applies when the home is sold. 

A line of credit that allows the borrower to withdrawal funds, make payments back to the lender, and then have the ability to make subsequent withdrawals. 

A fee charged by the lender to cover its expenses for originating the loan. A lender can charge the greater of $2,500 or 2 percent of the first $200,000 of your home’s value plus 1% of the amount over $200,000. HECM origination fees are capped at $6,000. Some lenders waive or reduce the origination fees on certain products. 

Paying off a reverse mortgage early (that is, before the borrower permanently vacates the property). Under the HECM program, there is no penalty for paying all, or a portion, of the loan prematurely. 

The total loan proceeds available at closing. 

A type of insurance policy that protects a homeowner or lender against financial loss from defects in title to real property and from the invalidity or unenforceability of mortgage liens. The cost for the policy is typically paid at closing by the borrower. ​

An interest rate that adjusts monthly or annually.

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Joseph Susserman

With 10+ years of experience, Joe Susserman is a top-level producer with a proven track record of success in the reverse mortgage space.

At The Steven J. Sless Group of PRMI, Joe educates homeowners to determine if a reverse mortgage will meet their financial goals. He then helps clients to navigate through all steps of the loan process.

“I enjoy assisting seniors to help them live a better retirement,” said Susserman, who has three sons and two grandchildren. Joe says, “I aim to provide the highest level of customer service and be responsive to all of my clients’ needs.”

JOSEPH SUSSERMAN: NMLS 986529. Maryland Department of Labor, Licensing & Regulation Commissioner of Financial Regulation #5511.

Steven J. Sless, CLTC®

Steven J. Sless has become regarded as the “go-to housing wealth source” by various media outlets. Bringing nearly 20 years of mortgage industry experience, he founded The Steven J. Sless Group of PRMI, the lender’s national division dealing exclusively with reverse mortgages.

A powerful speaker and communicator, Steven regularly gives seminars and learning workshops for homeowners 60+, their family and trusted advisors. Exploring the nuts and bolts of reverse mortgages, Steven presents the facts, dispels common myths and misperceptions, and answers questions so his audiences can make informed decisions and take control of their retirement.

In 2019, Steven earned the CLTC®: Certified Long-Term Care professional designation, demonstrating that he also has acquired the critical tools necessary to discuss the subject of longevity and its acute consequences on a client’s family – financially, physically and emotionally – years down the road.

“Possessing knowledge of long-term care and what decisions must be made before care is needed will allow me to better serve the needs of my clients,” Steven says. “Having a deeper understanding of my clients’ needs will allow me to have a more advanced conversation with them, their family and trusted advisors.”

In addition to helping clients and educating colleagues and audiences, Steven loves spending time with his wife and two young daughters. He also is an avid fan of the Baltimore Ravens and Orioles, and he enjoys playing golf and cooking.

Steven J. Sless NMLS# 298581 . Licensed by the Delaware State Bank Commissioner to engage in business in Delaware 5644 expires on 12/31/2021. Georgia Residential Mortgage Licensee. Georgia Department of Banking and Finance 6521. Indiana-Department of Financial Institutions Consumer Credit Division, First Lien License 11069 Secretary of State Securities Commission Second Lien License 103936. C.P.D. Reg. No.-19-07981

Brandy Nickoles

Brandy Nickoles has over 17 years of experience in the mortgage industry, dedicating the last 8 years solely to reverse mortgages. With great knowledge of the reverse mortgage product, she is committed to making sure our borrowers have a seamless experience.

Instrumental in creating infrastructure from file setup through loan funding, Brandy manages the loan pipeline. This includes everything from analyzing documentation and loan scenarios, to creating and implementing process/procedures, and coordinating with lenders.

Brandy also trains and oversees team members to ensure tasks are completed timely and efficiently. Having worked with Brandy for nearly a decade, Steven and Andrew can attest that her attention to detail and organization is top notch.

Covid-19

The Steven. J. Sless Group is fully operational and committed to expediting loans for our clients during these unprecedented times.

We have implemented the following measures to ensure the safety of our team members, strategic partners and valued customers:

  • Virtual meetings
  • Electronic applications and signatures
  • Contactless home appraisals
  • In-person meetings with social distancing and other necessary precautions

 

Call us at 410-814-7575 or schedule an appointment. (link )

Andrew S. Parker

Andrew Parker began his career in the mortgage industry in 1999 and transitioned to focusing solely on reverse mortgages in 2008. Through the years, Andrew has built a stellar reputation in scaling mortgage teams and overseeing products and systems training.

He has worked in tandem with Steven for the past 18 years and now oversees day-to-day production operations at the Steven J. Sless Group. In addition to managing loan originators and coordinators, providing product training and helping them to structure loan scenarios, Andrew works with credit desks to get clients approved.  He also navigates underwriting approvals.

Andrew is a big reason why The Steven J. Sless Group get clients approved for loans that other lenders don’t, and why the team closes loans much quicker than the industry average.  He has consistently forged strong bonds with and earned the trust of clients and strategic partners.

Robert Sklar

With 10+ years of mortgage industry experience, Robert Sklar educates clients about reverse mortgage loans and the strategy of incorporating housing wealth in retirement planning.

In doing so, he structures loan scenarios based on clients’ specific goals and needs. He also reworks loans to new terms and identifies additional conditions as needed to insure a viable credit decision. And he analyzes credit reports, property appraisals, titles and associated documentation.

Passionate about making a profound impact in the lives of his clients and others, the Hofstra University graduate has become a trusted resource of information and education in and around Baltimore.

ROBERT SKLAR: NMLS 1161107. Maryland Department of Labor, Licensing and Regulation Commissioner of Financial Regulation #5511.

Sharon Birdow

Bringing 30 years mortgage industry experience, Sharon Birdow is adored by her clients and colleagues alike.

The West Chester University graduate, wife and mother of four has served as branch partner and originating loan officer, branch manager and senior mortgage loan officer. She was named Loan Originator of the Year in Volume in 2016, 2017 and 2018.

At The Steven J. Sless Group of PRMI, Sharon helps clients 60+, their families and trusted advisors to obtain reverse mortgage loans. She regularly consults with financial professionals on the benefits an HECM provides and how to utilize this tool in individual retirement planning.

“It’s my privilege to educate and empower older Americans about the versatility of reverse mortgages,” Sharon says. “I love helping our clients achieve financial independence and peace of mind in their golden years.”

SHARON BIRDOW. NMLS#176375 // GA MLO # 47859. California – Licensed by the Department of Financial Protection and Innovation (DFPI) under the California Residential Mortgage Lending Act 4130403. A copy of our Privacy Policy and Notice is accessible by going to Primary Residential Mortgage’s website and clicking on the “Privacy Policy” link located at the bottom of the page. https://www.primeres.com/privacy-policy – District of Columbia-Department of Insurance, Securities and Banking Department MLB3094. Distrito de Columbia-Florida Office of Financial Regulation MLD646. Oficina de Regulación Financiera de Florida MLD646. Georgia Residential Mortgage Licensee. Georgia Department of Banking and Finance 6521. Indiana-Department of Financial Institutions Consumer Credit Division, First Lien License 11069 Secretary of State Securities Commission Second Lien License 103936. C.P.D. Reg. No.-19-07981 Indiana-Departamento de Instituciones Financieras, División de Crédito al Consumidor, Licencia de primer grado 11069, Secretaría de Estado, Comisión de Valores, Licencia de segundo grado 103936. C.P.D. Reg. No.-19-07981

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Justin Zornman

Fifteen-year customer relations and hospitality management veteran, Justin Zornman is the group’s first remote hire.

Based out of Kalamazoo, MI, he is responsible for helping clients to navigate the loan process. He also assists loan originators and aids the processing team to expedite loan closings.

A University of New Orleans graduate, Justin is currently completing his studies to pass the mortgage originators exam, get licensed and, one day, open a Michigan branch for the group.

“I am honored to ease the way for homeowners, 60+ to secure a better retirement,” Justin says. “I look forward to ultimately establishing The Steven J. Sless Group of PRMI as the market leader in Michigan.”

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