Last week’s National Reverse Mortgage Lenders Association (NRMLA) Annual Meeting in Minneapolis kicked off with a lively roundtable discussion as loan officers shared tips and techniques for connecting with a variety of borrowers and business partners.
Many of the LOs in attendance have been originating federally insured Home Equity Conversion Mortgages or proprietary reverse mortgages for decades. From advice on understanding the loans thoroughly to having more productive conversations with financial advisers, here’s a sampling of what was discussed.
John Luddy, Supreme Lending
I sell reverse mortgages with a missionary passion. I think that we have a moral obligation to sell it to our clients. If you think this product sells itself, you’re wasting your time here. You will not make it in this business. It does not sell itself. They will go back into the cul de sac and circle around and around.
You are there to teach them, to make sure that they understand it well enough. It’s like the horse thinking to jump the fence — it’ll walk that corral all day long, and it won’t think to jump the fence and drink the water. It’ll starve to death. It’s your obligation to make sure that you understand the product well enough — because product knowledge gives you the courage — and then anticipate what their objections will be.
Scott Harmes, C2 Reverse
I drive my wife nuts because I’m always telling everybody that we have a reverse mortgage. Then one of the common questions is, ‘What is a reverse mortgage?’ My question for you is, do you have a very good, concise explanation for clients?
Here’s mine: ‘Your reverse mortgage was created by an act of Congress in 1987, signed into law by President Reagan in 1988, as a benefit for senior homeowners who earn that benefit through age and equity accumulation. So it’s much like the benefit that a VA loan is for a veteran. A Home Equity Conversion Mortgage is a benefit for a senior homeowner.’ You can see the lights go on when you explain that.
Shannon Hicks, Reverse Focus
Don’t sit in your office, because you’re not going to be seen. Find a way to be engaged in the community. Don’t be intimidated to go out there and meet the chamber president and be proud of what you do.
You are like a financial Santa Claus turning locked-up money and bricks and mortar into cash flow. You have something to be proud of. You have a story, so be out there networking.
And then once you make those connections, don’t let that go cold. If you’re dating a girl, and you just see her once and then never talk to her for six months, she’s probably not going to be that much into you. Same thing with the financial advisers and professionals in your area, so be disciplined in your networking approach.
Ryan Ponsford, Equity Wealth Academy
Talk about making payments. Nobody makes payments on a reverse mortgage. But here’s the reason payments matter: When people are taking out a loan where they know they’re not going to make payments, do they feel responsible or irresponsible?
This is about psychology more than math. The beauty of talking about payments is it allows them to rationalize not being irresponsible. Whether they make a payment or not is essentially irrelevant. They have the option to make a payment. You have to create that rationalization, that emotional connection, that they can.
This is an arbitrage question. I can leave money invested and get an expected return. I can also pay down my debt and get a guaranteed return. When you make a payment, if I have a 7% rate on my loan, my return on that investment is 7%. Am I beating that in my investments? Maybe. But I’ll take that guaranteed return.
George Vrban, Movement Mortgage
I really break it down into four categories, four beliefs. No. 1, you have to believe in the company you’re working for. You need people behind you to help develop a business plan so you can physically go out there and do what you need to do.
No. 2 is to believe in the program you develop for the company and for your employees that are out there trying to do this in the field. No. 3, you have to believe in the product. There are people in this industry who don’t understand how to use this tool correctly. Forty percent of my business each year is from financial planners. I teach it as a retirement tool.
The last belief is believing in yourself. Sometimes you’ll have other people who will believe in you more than yourself. If you structure it for yourself, come up with your business plan and have that support system, I guarantee you that the Red Sea of opportunity will open up.
Dan Hultquist, REVERSE plus
I’m so glad Ryan Ponsford talked about making payments. That’s the kind of thing you want to model. Ryan also mentioned needs-based borrowers. That is a small piece of the pie.
You can’t sit around waiting for the phone to ring, for somebody desperate enough to pay 2% of their home’s value to the federal government because they absolutely need money tomorrow. That’s not the solution. You have to learn how to speak to non-needs-based borrowers.
I’ll pick on George Vrban for a second. Of the 90 to 100 loans he’s closed this year, how many were to desperate, needy borrowers who are on their last check? Less than 20%. He’s selling to non-needs-based borrowers. He’s also selling to people who claim they don’t need it. He’s working with the financial planners, and that’s where the other 80% of the market is.
Lisa Moriello, loanDepot
If the people that are within 300 feet of you don’t know what you do, you have a problem. You need to be able to succinctly tell them what you do. And I don’t really care if you use ChatGPT, because it helps me focus my brain. It’s a really good assistant.
My message is, I tailor mortgage solutions for every stage of life. Your message can be whatever you want it to be. Just have a message and practice it. It’s so important to be able to express what you do.
What happens between now and the end of the year? The holidays. What happens at the holidays? Everybody sees their elderly relatives that they haven’t seen in a while. This is an opportunity to express to your clients, no matter what their age is, that they might want to check in with their elderly parents. And if you’re not taking advantage of that right now, then you’re all missing an opportunity.
Harlan Accola, Movement Mortgage
A lot of people wonder why they’re not successful in this business and why they don’t sell a bunch of loans. And the fact is, there were very few hands that went up when we asked how many people here have a reverse mortgage or are planning on having one.
When I was 43 years old and I learned about reverse, I sat down with my financial adviser and said, ‘Should I do this when I turn 62?’ It was the plan for 20 years. How many of you have already done that with your financial adviser? It’s way too few.
I was recruiting a guy once who called me and said, ‘Hey, I’m looking for a job. I’m wondering what your comp plan is.’ Which is not a good way to start the conversation. But I said, ‘Well, I just want to know a little bit about you first. When are you going to turn 62?’
He said, ‘Oh, in a couple of years.’ I said nothing. ‘Are you going to get reverse mortgage?’ And he said, ‘I’m glad to help other people, but I sure hope I’m not going to need one.’ I mean, think about that.
