Brokers’ Questions Answered!

Written By Jeff Murray

22 March 2019

Heartland Seniors Finance recently held a reverse mortgage webinar with Mortgage Professional Australia. During the presentation, Andrew Ford (Heartland CEO) and I (Head of Distribution) explained how a reverse mortgage works, the benefits to the borrower, changes to the sector, and the advantages of adding this product to a broker’s portfolio. You can access a recording (audio and visual) of it here, or you can view the slides

I’ve put together a roundup of some interesting results and the most commonly asked questions – there were so many we couldn’t answer them all during the webinar.


Webinar poll results

  • 99% of respondents with a view on outlook said that they expect the demand for reverse mortgages to grow over the next 5 years;
  • Over half of respondents indicated that they currently have clients in their customer base that could benefit from a reverse mortgage; and
  • 80% of respondents thought that one of the biggest benefits of adding reverse mortgages to their portfolio was being able to cater for this growing demographic:

 

Click for full size

 

Top 5 Broker FAQs answered

1. How do I become accredited?

Heartland has a straight forward accreditation process to ensure you have an understanding of our product and process to benefit both you and your customers. To ensure understanding, our training includes a test, which a broker must pass to become accredited to write reverse mortgages with Heartland.

Our Accreditation Training can be found in our Broker Portal under Broker Agreements, or by contacting us. We don't require any further accreditation apart from ours.

2. Is Heartland on my aggregator’s panel?

Heartland is on the panel of a number of aggregators, with more being signed up regularly. Even if your aggregator is not signed with us, we are happy to accept loans from you (although you may need to obtain approval from your aggregator).

Please contact us to confirm if we are on the panel for your aggregator.

3. How can I promote reverse mortgages to my customers?

Heartland’s Broker Portal not only provides you with all the materials you need to write a reverse mortgage, but also includes helpful tools and resources to assist you in building your business, including a template article and letter to get you started.
 
You are also welcome to use, embed and/or share any of the informative videos we have developed on our YouTube channel, including our flagship animation Reverse Mortgages Explained.
 
In addition, on our social media pages, we regularly post interesting and informative articles on travel, property, unlocking home equity, aged care financing, reverse mortgages, downsizing and other important issues concerning Australian seniors. We invite you to follow us and share any of our posts you find to be of value to your customers.


4. How does the equity protection option work?

Under the Equity Protection Option borrowers may choose to protect a percentage of the eventual net sale proceeds of their home (10%, 20% or 50%). Provided the terms and conditions of the loan are met, when the loan is repaid, they or their estate are guaranteed to receive the chosen Equity Protection percentage.
 
Please be aware that a fee of $295 applies for choosing the Equity Protection Option, and it will reduce the loan amount (LVR) available by the percentage selected  (for example, if the maximum LVR available is 20%, and the borrower chooses 10% protection, their maximum LVR reduces to 18%).


5. What is the secondary property loan?

Heartland’s Secondary Property Loan allows customers to access equity in their non-owner occupied property (holiday home or investment property), by using it as the reverse mortgage security.
 
If the security property is an Investment Property or Holiday Home, the maximum amount available (LVR) is reduced by 25% to reflect additional risk and potential tax implications. The loan must be repaid when the last Nominated Borrower leaves their home (primary residence) or sells the security property.


Let's work together

Our Broker Support Team are available to answer any questions you have regarding the benefits of incorporating reverse mortgages into your portfolio. Please feel free to contact us on 1300 662 865 or simply email us at [email protected].
Information provided is accurate as at 21 March 2019 and may change from time to time.

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