On the heels of reverse mortgage product changes including limits to upfront draws on loans and an upcoming financial assessment for borrowers, reverse mortgage marketing professionals say they are changing their messaging to reflect the new opportunity the product now presents.
“I don’t think it will be easier, but there is an opportunity,” said Liberty Home Equity Solutions Director of Marketing Mary Smith during a panel discussion at the National Reverse Mortgage Lenders Association annual conference in New Orleans on Tuesday.
Rather than marketing to a mass audience of age-qualified borrowers, lenders say they are shifting to a more “niche” approach. American Advisors Group Chief Marketing Officer Teague McGrath said the company plans to roll out new commercials targeting one or two of the changes.
“We have to look at other segments and higher income households,” McGrath said, noting the potential opportunity to work with financial planners. “We have the opportunity to leverage these changes. This is going to give us more credibility and trustworthiness. We should take that opportunity while we have it, to go to the market and say this is the best new reverse mortgage and use the changes to our advantage.”
The message is going to be geared more toward a specific borrower segment, said Ralph Rosynek, who leads marketing for Reverse Mortgage Solutions.
“The term ‘funding longevity’ is better for today’s customer,” he said. “It’s niche marketing instead of mass marketing.”
The changes went into effect October 1, and have impacted the cost of generating leads since then, McGrath noted.
“We are seeing the impact from the initial changes. We have to accommodate that and look at the opportunity,” he said.
A forthcoming financial assessment will add additional product overlays, which were initially anticipated to go into effect in January. However, the Federal Housing Administration said this week the financial assessment will be delayed until further notice.
Written by Elizabeth Ecker