The Old Ball Game

By Peter Bell

The day after we held a press teleconference to announce our Borrow with Confidence  consumer education effort, we received a call from a producer of Maria Bartiromo’s Closing Bell show on CNBC, inviting me to appear the following evening to discuss its intent. 

On a subsequent call, I was informed they were searching for an additional guest  who was “less supportive of reverse mortgages,” according to the producer.  And so I was not being invited on to present our new educational campaign, but rather to argue about it.

I suppose it is not surprising that in a culture obsessed with sports and politics, far too many things are turned into competition.  Throughout the broadcast segment, the chyron message on the television screen read, “The Pros and Cons of Reverse Mortgages.”

As it turned out, in the one day they had available, the opponent selected for me was Christopher Thornberg  of Beacon Economics in California, whose website describes him as an “Expert in economic forecasting and real estate dynamics.”     Dr. Thornberg has a PhD from UCLA, is by all indications an extremely intelligent man and speaks frequently about economic issues.  What he does not have is any real background in reverse mortgages. 

I am not sure why he was tempted to appear on this particular segment.  Is it that in this world of the blogosphere we have all become critics and are willing to speak negatively about anything?  Or possibly that the chance to be on television for someone who makes his living as a speaker is of such value that they will talk about whatever you ask?

In any case, I was invited to be the pro side and Dr. Thornberg was invited to be the con side.  While I discussed the value of counseling and the insurance fund, comparison of closing costs to conventional mortgages and the tools offered by the Borrow with Confidence campaign, Dr. Thornberg’s cons were of such a general nature that he could have used the same comments to debate against health insurance, iphones, dating, kale or almost anything else I can think of.

“At its surface, this (reverse mortgages) is a great idea,  just like subprime mortgages at its surface was a great idea as well,” Thornberg began.  “But we know in both circumstances there’s a lot of room for shenanigans .  And of course, with reverse mortgages, because you are dealing with people in retirement this leaves very little room for air.”

“Maybe the underlying industry is good today, but as this grows there’s going to be problems and there have to be regulators there to make sure the problems are kept to a bare minimum.”

After I ran off a series of regulations and said we are a business of transparency, Dr. Thornberg, the opposition, responded, “I agree with most of what he just said.”  Only to go on and say, “In any of these growing industries, there’s going to be problems on the edge.”

When Ms. Bartiromo asked him, “What should regulators be doing?” Dr. Thornberg replied, “There has to just be a lot of basic clarity.  Consumers have to see both the upside and the downside.”

You get the gist. 

The point here is not to in any way make fun of Dr. Thornberg or anyone else. But we are living in an economy where so many seniors are in need and a reverse mortgage can fill that need.  Just a week later, the CFPB offered their report claiming seniors are confused about reverse mortgages.  Here was an opportunity to explain the product to a sizeable audience.  But by turning the show into a ball game instead of an educational opportunity, the producers and CNBC eliminated the chance for the fifteen minute segment to do any public good. 

I have requested an opportunity to revisit the show and discuss reverse mortgages one-on-one  with Ms. Bartiromo.