Got Reverse? Industry Needs to Deliver Effective PR Campaign Now

It is clear to all reverse mortgage participants that something has to be done to improve our image. It was the reoccurring theme at the recent NRMLA conference. But talk can be cheap and without a coordinated, concerted effort to take control of our public perception, we may struggle to convince lawmakers, regulators, seniors and their caregivers that this product provides the benefit we believe.

The conversation should now proceed past the initial concern (and too often complaint), of nothing being done and examine the options that lie before us. All agree that a public relations campaign of some sort is the best move forward. Though, there are two major issues yet to be resolved; how to deliver an effective message and equally important, how to pay for it.

First, what does this PR initiative consist of? Other industries and groups have used public relations initiatives to get their point across for years. Pharmaceutical, oil, agriculture, food, beverage and alcohol industries, lobbying groups, charities and even government programs have all employed this kind of approach to improve the public perception of their respective industries. We acknowledge that we are not the same size, nor have the same buying power as some of these groups, though, we can learn from the results these campaigns have produced and modify them to best suit our situation.

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To promote more discussion and further debate, the following are some ideas of how to first source, and then deploy, the message:

1.) First, I would propose the formulation of a white paper conducted by a third party organization focusing on the many benefits of a reverse mortgage. It would highlight the enormous customer satisfaction that already exists and take a quantitative approach to consumer attitudes, knowledge, experiences and behavioral trends. It would give the industry a clear and independent appraisal of the product as well as useful results and responses to assist in developing the message.

2.) With the white paper in hand, we could then begin a two pronged approach using different bodies for each strategy. One, a lobby group (working hand in hand with NRMLA) to approach lawmakers and regulators and secondly, a PR firm to get started on the consumer side. These could also be viewed as long and short term strategies respectively.

3.) The lobby group and NRMLA could then consider strategies such as:

a. Promoting the creation of a Congressional Research Committee to independently research and analyze the benefits of reverse mortgages.

b. Coordinating a Congressional Hearing on Reverse Mortgages where industry representatives can testify.

We need the lawmakers to come up with a consistent position on the HECM program. We all know the facts cut in our favor and this product is helping thousands of seniors. It’s damaging if we don’t help them get the facts straight.

4.) On the consumer side, a radio, TV, and print campaign should be employed utilizing the messaging resourced from the white paper with a careful budgetary eye on where and how seniors are currently using the three mediums.

5.) Finally, combine the media campaign, the white paper and lobbying efforts with strategic press releases and partnerships with senior organizations.

One industry campaign worth examining because of its effectiveness is the California Milk Processor Board’s “Got Milk” campaign which began in 1993. It is one of the most successful and recognizable industry campaigns of recent times. Studies showed the campaign achieved 90% awareness levels in California and household penetration of 70%. The campaign won a ton of marketing and advertising awards and has become the benchmark for many others. The Milk Board was facing similar problems; declining acceptance (sales for them) and a lack of relevance in the marketplace. Although they didn’t have the added burden of some negative press, they changed the way people perceived and ultimately consumed milk. The creator of that campaign, Jeff Manning (who also wrote a book about it), learned some important lessons from the experience:

1.) Leverage strategic publicity – Once your message is up and running, make sure you consider the journalistic media as an “audience” in addition to your target market. They need to be approached, marketed, lobbied and convinced to do stories just like your customer – sometimes in very different ways.

2.) Don’t try to do it alone and look to create association assets – Consider participants with similar interests to assist and provide added value and industry buy in. If you can also create partnerships and associations with other groups within your industry, it provides increased awareness and added credibility.

And there is this most important cautionary note from Mr Manning; “…the alignment of goals and budgets is absolutely crucial to the success of any campaign or organization.”

Which brings me to the other issue of financial resources and how we pay for such a campaign? What is the best approach and strategy to employ according to the capital resources we can procure? The best suggestion I’ve heard is a little “Back to the Future” by adding a small fee to each closed loan to build a campaign fund. How we charge servicers, title agencies, appraisers, or even Wall Street participants is up for more discussion. The other problem is time. How long before we can hope to achieve something as we build a fund worth deploying? Of course, that also leads to more questions; who controls the fund, the budget, the creative, the message and its delivery? The obvious answer to many of these problems is NRMLA. Though, as a paying member of our industry organization who is also paying to subsidize this marketing effort, how much control does each of us get in what the message is and what strategies are employed? I suggest we form a sub-committee under NRMLA that is comprised of fifteen or so veterans in our industry that can take on this challenge. We need more representation for an undertaking like this than just a few companies or individuals.

The cost for a campaign like this? Probably between $1 million and $2 million annually. If funded by a $10 – $20 unit tax, we can fund the initiative indefinitely or until we feel we have achieved our goals. I think we may also want to consider asking for start up contributions from some of our larger industry players.

This is not going to be a small undertaking and its going to take a lot of participants in the industry and money to get it off the ground. But the alternative is worse. If we don’t do anything, every facet of our industry will be negatively impacted – lead cost, marketing budgets, closing ratios, secondary and investor comfort and interest, legislative changes and further federal and state oversight. The list goes on but it’s not difficult to understand how important this kind of public relations effort is for all of us – the sustainability of this industry may rest in our very own hands. Why shouldn’t we get involved and make something happen? I am hoping this will start a productive debate and discussion to get things moving forward. This is the first step of something much needed – an industry campaign that galvanizes us and creates an environment where all the credible, reputable players can prosper and help thousands of more seniors live a better life.

Written by Reza Jahangiri, CEO of  American Advisors Group

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  • I commend Mr. Jahangiri for starting this important discussion and Admin for running it. Mr. Jahangiri is precisely right this is an outgrowth of the last NRMLA convention in San Diego. It is important to note that many of us will not agree on the approach or the mechanics but most all of us agree on the need.

    Our firm is both a member of NMRLA as well as the MBA; however, if one organization must be in charge, NRMLA is the better entity to handle this matter. Some will disagree with this statement and demand this particular venture be handled outside of NRMLA. While potential participation might be higher outside of NRMLA, organizational infighting and delays could defeat the very nature of this campaign.

    While what is being proposed is reactive, we need to react in a way that our actions will become proactive. This proposal will provide that platform.

    While creating a white paper may not be critical, it would be very useful. Many knowledgeable financial advisors are still surprised about what a HECM can provide seniors in financial terms beyond the obvious infusion of cash or a reserve of cash.

    While it is important to reach out to consumers and those in government, it is also important to reach out to professional advisors, particularly elder law and estate attorneys, CPAs, and CFPs. Attorneys and CPAs in providing transaction advice are called deal breakers for a reason. With milk, medical advisors do not normally discourage patients from drinking reasonable amounts unless the consumer has allergies or some other relevant medical condition. Financial and legal advisors discourage consumers from getting reverse mortgages unless “it is absolutely necessary.” We need a change in that outlook; otherwise, we will always be fighting an uphill battle and running out of steam doing it.

  • There was a rumor that the top banks would pool some money and attack this head on. In theory, it makes sense – take the top 10 lenders to contribute 200k each and you'd have 2mil to take it on. The top 10 all have an interest that would support the donation of the funds. To wait for NRMLA to act is on this is like waiting for the govt. to fix health care or social security…..

    Great topic, but is it too late?????

  • Two million dollars for a PR campaign? That is outrageous…

    I don't disagree in any way that a PR campaign is needed – but an effective one would not need to reach that excessive level of spending.

  • I love this article!!! I think we need to activate our army of seniors to help…I think one tactic that could be done is to do a Michael Moore type documentary that is news worthy…For Example get a bus of Seniors head up to Claire Mccaskill's office and ask her why she hates this program so much that have helped so many…I think if we can get a little army of seniors to put public personalities who have slammed the product to get on the defensive it could have quite a positive effect on our image.

  • I agree with this in theory, but wonder about two things: (1) will the membership of NRMLA, across the board, financially support this? (2) time is of the essence so how long will it take to get this campaign rolling? If it takes as long as the CRMP program developed by NRMLA took, we probably won't see anything until 4th quarter of this year…and that's too late!

  • What is being called for here is a “public affairs” campaign. NRMLA has been interviewing several firms experienced in “reputation management” to assist us with such a program and discussing how to fund such an effort. Our work, to date, on this was discussed on our most recent monthly Board conference call and a final decision to proceed is on the agenda for our February 23 Board of Directors meeting in Atlanta.

    The primary issue to be tackled at the atlanta meeting is the funding mechanism for this effort. Our proposal is to fund with two sources: (1) a per loan fee (Perhaps $15) aggregated and collected at the wholesale level for loans originated by correspondents and at the retail level for seller-servicers who sell directly to Fannie Mae or issue GNMA securities; and (2) voluntary contributions from companies in with interests in the RM business, including vendors, servicers, investors, etc. (Lenders could, of course, make voluntary contributions in addition to the “per loan assessment.”)

    A problem that the industry has been suffering from is that while many call for this type of public affairs/public relations effort, few have been willing to step up to the plate and fund it. NRMLA ran a similar campaign several years ago, funded by $15 per loan assessments that wholesalers either deducted from correspondent fees or remitted on their own. In those days, that program yielded about $600,000 per year which was devoted exclusively to our PR efforts. If you do a search of the press coverage from that period, you will find that is was very successful and generated many positive pieces. The problem was that there was a lot of grumbling around the industry, primarily from correspondents, so the wholesale participants eventually dropped the program.

    Where we stand right now is that we have identified and interviewed two firms with the core competencies we seek and have obtained proposals from each. An informal committee of communications and PR execs from several of our major members has reviewed the two proposals and also suggested a few other firms to be interviewed.

    NRMLA staff is prepared to move on implementation with one of the PR firms — but must have the commitment for funding from the industry before we can proceed. We cannot enter into an obligation to a PR firm that we estimate will be approximately $1.5 million per year until we have the funding plan for it intact.

    In the days ahead, we will be looking to get the program started and put out a call for voluntary contributions to get started before the per loan assessment can be established and implemented. NRMLA member companies who contribute to the campaign at higher levels will be invited to place a representative on an Executive Advisory Board that will help develop and oversee the effort.

    If Mr. Jahangiri would like to “jump start” the process, I would encourage him to lead by example and make the $200,000 contribution he proposes from the top ten participants in the industry. As soon as we have some of the funding in the bank, we could engage a PR firm and get going. There is an opportunity here, Mr. Jahangiri, for you to move this from conversation to implementation. All it would take is your contribution at the level you propose.

    • I believe NRMLA would be better served in the near future to fix the gaping wounds in the reverse mortgage program before trying to sell damaged goods. Why do you think all the federal and state legislation designed to overhaul the reverse is underway? Need an example? How about the charging of seniors at the door for an appraisal due to start 2/15. Along about Mar you will see that this discriminatory action will drive seniors away in droves. How about the fact that seniors rarely get to see their appraisals during the process and cannot possibly make good decisions without knowing the fair market value of their homes. How about a valuation process where mortgagee underwriters are illegally changing properties on appraisals and never letting the client know. Ifg the media gets hold of this, all the PR in the world will not help and your credibility will completely disappear.

    • I believe NRMLA would be better served in the near future to fix the gaping wounds in the reverse mortgage program before trying to sell damaged goods. Why do you think all the federal and state legislation designed to overhaul the reverse is underway? Need an example? How about the charging of seniors at the door for an appraisal due to start 2/15. Along about Mar you will see that this discriminatory action will drive seniors away in droves. How about the fact that seniors rarely get to see their appraisals during the process and cannot possibly make good decisions without knowing the fair market value of their homes. How about a valuation process where mortgagee underwriters are illegally changing properties on appraisals and never letting the client know. Ifg the media gets hold of this, all the PR in the world will not help and your credibility will completely disappear.

  • Man this sounds just like our Government…”Got a problem….form a committee”….HOGWASH……The time has come for all the major players in the market to stand up and come out from behind the shadows. It's time for all the major players to take control of the conversation instead of hiding in the bushes while the industry is bashed left and right. You want to add legitimacy to this business, then how about snoopy putting “reverse mortgage.. for the if in life” on one of their blimps…or Wells Fargo putting it on their stagecoach…or for that matter how about the major players talk to the press….open their doors, let the press in so they can see what it is all about. We don't need a committee or 2 million dollars….we have everything we need already…the major players just have to open their mouth.

  • I've blogged for a long time that TV Commercials featuring real Seniors whose lives have been enhanced (even saved) with the FHA HECM are badly needed. By the way, I purposely use FHA HECM to emphasize that this is a US Government program. What we don't need is for Peter (…) (……) Bell and his band of Big Spenders to have anything to do with any money appropriated for this project. Interesting that he is suggesting the old $15.00 per loan tactic again. Hey Peter (…) (……) Bell, go talk to Snoopy after all one of its heavy hitters management types, who claims he has originated over 900 reverse mortgages him self , (and I don't doubt his integrity but strangely enough he didn't know the IRS MAY send a Senior borrower's heirs an income tax bill if, when the last Senior leaves the home permanently, the home is worth less than the mortgage debt. Of course, thanks to the above Blogger, the esteemed Mr Veale, we now know the truth.) is a Co-Chairman of your Board (I think that is what the man claimed.). But really, I fear letting Peter (…) (……) Bell touch any of the coin is like allowing the fox in the chicken coop.

    • Hey James A. Nelson – I'm visiting my 86 year old parents now (my dad had heart surgery last week) and my mother has asked hhat do the parenthesis and dots (…) (….._) mean every time you write my name? She was wondering if perhaps you have a condition that makes you hit keys indiscriminately?

    • Mr. Nelson,

      While many of your blogs are interesting, the personal attacks against Mr. Bell and Mr. DeMarkey are not. Coming from a CPA background, I find NRMLA friendly, hardworking, competent, and effective. If the industry were larger and there were more funding for NRMLA, many of the things we see going wrong might be nipped in the bud.

      Yes, there will always be things we do not like about the direction that our industry trade group — NRMLA — takes but not every CPA always likes what the AICPA does either. Many attorneys are not always real happy with the decisions of the ABA. However, those industries have learned to keep their differences in the family, roll with the punches, and try to change things from the inside. Although there have been groups trying to compete with the AICPA, no group does a better job representing the CPA industry as a whole than they do. My personal opinion is exactly the same about NRMLA.

  • WOW! I love this exchange. So many people here have the right idea. Someone should have hired a social media firm to manage the industry's damage control 18 months ago. Or maybe 24 months ago…..Personally I'm amazed that anyone is surviving right now aside from the big players. It's insanely tough out there.

    • Valerie,

      What an odd comment. Why is a social media firm required?

      Our detractors use traditional media very effectively. While posting on social media might be marginally effective, traditional media seems to be of far greater importance. No doubt a mixed approach would be most effective. But please explain your approach.

  • PR campaign is a great idea! NRMLA is the logical place to handle it. I like the per-funded-loan assessment. Such a national campaign will easily cost a few million dollars annually.

  • Once again, lancejackson shows what a fool he is, in my opinion. The only correct word in you blog is the word “easily”. Why don't you and Reza Jahangiri fund the program your selves. By the way, I wonder how many face-to-face FHA HECM loan originations Reza Jahangiri has ever done? Would be interesting to know his background.

  • My prayers will include your Father, Peter (…) (……)Bell. Your Mother, I am sure, is a beautiful, loving person. I am curious did you own up to the moniker or did you wimp out and say obviously She was right and I was just some jerk out in the wild Pacific Northwest with a vendata against Washington D.C. Lobbyists. By the way, do your Parents enjoy the benefits of an FHA HECM? If not, you might tell them , you know a 71 year old “kid” who can help them out in that endeavor: A guy who considers his job a “calling” and that I put Seniors first and lobby groups way, way, way down the line of society's importance, unfortunately for their talented and hardworking Son, Peter (…) (……) Bell. (By the way Mom, the dots stand for Peter (.t.h.e) (.w.o.n.d.e.r) Bell.

  • You are absolutely correct, Mr Veale, you are entitled to your opinion and
    on Accounting matters, like Peter (…) (……) Bell, you are a wonder, too.
    As far as Mr Demarkey, truly I find it very strange (and I'rn disappointed, frankly, that a man of his stature, who claims to have personally originated over 900 reverse mortgages (I'm sure they were not all FHA HECMs), thought FHA HECM Insurance proceeds were treated just like Life Insurance proceeds by the IRS (so he stated to me over the telephone and I will swear to that in a Court of Law, Sir.). I also thought it interesting that you were quick to say that my…”caller was wrong”
    quite forthrightly but once you learned who the caller was, you softened your remarks (not changed, just softened.). It's true I am not impressed with someone because of their position or name. I evaluate others based upon their genuine knowledge about their occupation and how well they treat others as well as my self. As far as not finding my remarks funny, some of them may appear to be said in jest, but I assure, Sir, they are not.

  • James (…) Nelson, you say “I evaluate others based upon their genuine knowledge about their occupation and how well they treat others…”

    Based on your remarks that I have personally read on RMD, I would think you would take your credo to heart and look yourself in the mirror. Constructive criticism of our industry, trade association, etc. is one thing. Personal attacks against indivduals is simply unprofessional and disgusting.

  • Good Grief… its no wonder that so many people in our industry are no successful with all this sniping and back biting going on… How in the world are we to make changes if we cannot even unite! Grow up!

  • Admin: Please accept this as a formal request to ban James Nelson from posting comments on this board. He continues to openly pursue his vendetta against Peter Bell with truly vile comments. He offers nothing of value unless you consider personal attacks “entertaining”. Mr. Nelson, you are a boor, a verbal bully, and as Reverse guy said, what you write on RMD is disgusting. Admin, I implore you to kick this guy to the curb!

  • reverseguy, you are another one of those shining examples of bloggerrmania: So proud of who he is and what he writes that he is unwilling to use his real name (I consider that practice unprofessional and disgusting.). I hope you treat Seniors with greater transparency.

  • Our PR message for FHA (HECM) has to be short and open ended.
    “A Reverse Mortgage for Seniors, might not do you a bit of good.
    On the other hand, it could be the road to a worry free future”
    It cost nothing to find out if it is for you.

    Trying to answer the critics in great detail is a doomed path to failure.
    Bob LaFay, Reverse Mortgage Consultant

  • I commend Reza for taking the time to put this article together and for inspiring us all to unite and take action. In my opinion, I think that both Peter Bell and Joe DeMarkey are an asset to NRMLA and this industry. Reverse mortgages have changed so much in the past couple of years and I think we all need to be reminded as to why we chose to work in the RM industry…..seniors. Everyone is entitled to their opinion but, for those of you that do not care for NRMLA, I encourage you to attend the NRMLA conferences, especially the legislative conference in DC. I am excited to see what 2010 will bring and I hope that we can come together as an industry and continue to change seniors lives.

  • I commend Reza for taking the time to put this article together and for inspiring us all to unite and take action. In my opinion, I think that both Peter Bell and Joe DeMarkey are an asset to NRMLA and this industry. Reverse mortgages have changed so much in the past couple of years and I think we all need to be reminded as to why we chose to work in the RM industry…..seniors. Everyone is entitled to their opinion but, for those of you that do not care for NRMLA, I encourage you to attend the NRMLA conferences, especially the legislative conference in DC. I am excited to see what 2010 will bring and I hope that we can come together as an industry and continue to change seniors lives.

  • Admin – as a daily reader and infrequent participant, I second the notion of removing James Nelson's ability to participate in any discussion. This is a public forum that is read by many and he is giving those in our profession a bad name. Ironically, that's the opposite of what this thread is about.

    As a small player in the industry, I'm all for the campaign and participating on a per loan basis.

  • Woo-hoo, look who's gone!!!

    Seeya James Nelson, and we hope you either get professional help or find a board that enjoys your sick disgusting comments.

  • Woo-hoo, look who's gone!!!

    Seeya James Nelson, and we hope you either get professional help or find a board that enjoys your sick disgusting comments.

  • Just saw the article at http://www.prnewswire.com/news-releases/legenda… interviewing Peter Graves.

    Wouldn't it be wonderful if he and Robert Wagner could do many interviews around the country (picked up by local stations) saying much as Mr. Graves did without compensation. Perhaps a number of them getting to UTube.

    Best if they were willing to do pro-bono without even having their expenses picked up by NRMLA or any other self serving industry sponsor.

    Call me a dreamer.

  • Should we be discussing industry PR strategy online? Is PR the real solution for industry image problems? Can PR heal self-inflicted wounds? Shouldn't FHA/HUD be part of the solution?

  • TomMacDonald – that's just about the smartest thing I've heard all year. Yes, celebreties should work pro bono so you can earn commissions. Call you a dreamer? I call you a moron.

    How many loans did you do for free last year? There aren't many communist republics left, mind you, but maybe we can ship you to Cuba.

    • I volunteer for a number of organizations. Two of them are senior organizations. I also help seniors with other solutions when a reverse mortgage doesn't work, pro-bono, if you will.
      Mr. Graves and Mr. Wagner probably volunteer for different organizations themselves. They might be in a financial position to volunteer to help other seniors such as themselves as one more avenue of volunteerism on their part.

      • Maybe Santa Claus and the Easter Bunny will show up to my next barbeque.

        Congratulations on being a volunteer. You deserve a cookie. I'm very proud of you.

      • You deserve a cookie.”

        Commondude, you sound annoyed, did your teacher forget to give you a cookie at nap time today?

  • I think PR should absolutley be the priority of the industry right now. We get such a bad rap in the media from so many people who have no idea how great the product can be or the enormously high satisfaction rates it enjoys.

  • I would gladly give up $15 or $20 dollars per loan to help pay for an effective media campaign. Based on Peter's comments above, it looks like they (NRMLA) are almost ready to implement such a campaign provided the funding can be secured. That is where we come in. Let's move forward ASAP.

  • Bill White, that is enormously helpful. $30-40 a month from your company’s closed loans will really get to where we need to be. Thank you! ROCK ON! VIVA LA REVERSE MORTGAGE!

  • There is no question that the PR angle is a vital component in our efforts to switch from a defensive to an offensive mind set. Given the scope of the changes now being bandied about, it is even more imperative that we find an effective voice to express our . If we cannot control the dialogue we must at least be in a postion to steer it.
    NRMLA is the obvious vehicle for such an effort given their role over the years. Instead of personal attacks on it’s leadership, which has worked very hard with minimal resources, critics might be better advised to focus on the problem and help contruct a solution. With respect to Atari’s points, yes some of the wounds are self inflicted and HUD?FHA absolutely need to be involved in addressing some of the problems but right now one of our biggest issues is perception. Speaking of perception, even industries that have a terrible public image e.g. oil, tobacco etc. place a huge priority on press campaigns. I remember a NRMLA convention a few years back where a HUD official mentioned the possibility of a government public awareness campaign for reverse mortgages ala the ‘buckle up’ program. Never heard any more about it.

  • Hey, this is a great conversation. I joined this industry because I thought I could make money, and help seniors at the ame time. comeondude, I don't blame you for being negative, but this is the place for constructive help, not more negativity. NRMLA has the right idea, and if we could get some free publicity, that would be great. That's what PR firms are supposed to do. Get Free Press!
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