Reverse Focus Helps Drive Heartland Bank’s Reverse Mortgage Growth

Following a major play in the reverse mortgage space last year, New Zealand lender Heartland Bank teamed up with U.S.-based reverse mortgage consulting firm Reverse Focus to help increase production, streamline sales and operational processes. And now it appears the collaboration has begun to yield positive results.

In April 2014, Heartland Bank acquired the reverse mortgage business of Auckland-based Seniors Money International Limited for NZ$87 million. The acquisition expanded Heartland’s ability to offer seniors in both New Zealand and nearby Australia “Home Equity Release Loans,” known stateside as reverse mortgages.

With this increased scale also came the need to grow the reverse mortgage platform, and so Heartland secured a consulting agreement with Reverse Focus, which already had a track record of assisting reverse mortgage lenders via its training, technology and consulting strategies in both the U.S. and abroad.

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The challenges Heartland Bank faced in New Zealand were similar to hurdles witnessed in the U.S. during the early days of the reverse mortgage lending industry, said Reverse Focus CEO Eric Hiatt.

“Just like when the industry was young here in the U.S., there is a perception issue in how you share the reverse mortgage product with potential clients,” Hiatt said. “In New Zealand and Australia, home equity is a big deal and it’s looked upon as something to be proud of—so there are certain stigmas to deal with.”

Reverse mortgages are becoming increasingly popular retirement strategies among Australian retirees, as a recent Deloitte report estimated more than $500 billion of home equity is held by Australians age 65 and older, with the nation’s total reverse mortgage loan book worth $3.66 billion at the end of 2014.

The collaboration Down Under adds to the international relationships Reverse Focus has formed with multiple companies in countries like Ireland, Canada and Hong Kong, where the firm works with lenders there to assist in a variety of operational processes, including training sales staff, developing customer relationship management (CRM) platforms, marketing, as well as writing policies and procedures for all aspects of operations, Hiatt said.

Led by Rhiannon Behnke, Reverse Focus’ senior vice president in charge of consulting, the U.S.-based team visited Heartland branches in Auckland, Tauranga and Christchurch, and met with Heartland’s leadership to analyze the bank’s existing reverse mortgage operations.

Once analysis was complete, the team then recommended strategies to increase productivity, efficiencies and lead conversions, and helped implement new sales systems, operational workflows, reporting tools and benchmarks to establish performance metrics, both within the call center and within the bank’s operational infrastructure.

The process and initial conversion to the new system took under 12 months to complete, and since implementation, Heartland Bank has seen a consistent month-over-month increase in their production, according to Reverse Focus.

While financial details were not able to be disclosed, the changes implemented by Reverse Focus had a “substantial positive impact” on the way Heartland Bank does business, said Chris Flood, head of banking at Heartland Bank.

“I appreciate the experience and insight they bring to the relationship and I’ve enjoyed working with their team,” Flood said in a written statement. “Our Home Equity Release Loan business is growing, and we certainly have Reverse Focus to thank for that.”

Written by Jason Oliva