For its first foray into the reverse mortgage sector, Affinity Partnerships, LLC, is banking on a network of industry lenders, a growing consumer knowledge gap, and the endorsement of a Hollywood celebrity and distinguished humanitarian to bring greater reverse mortgage education to American seniors.
Reverse mortgages are some of the most misunderstood financial products on the market today. Perhaps no thanks to mainstream media horror stories in the years prior to the most recent string of changes to the Home Equity Conversion Mortgage (HECM) program, reverse mortgages have consistently grappled with a public perception problem. But even with new protections for both borrowers and their non-borrowing spouses, reverse mortgages continue to wrestle with their old reputation.
Education is often considered the best offense in the ongoing contest to dispel misconceptions and enlighten prospective borrowers who would likely benefit from a reverse mortgage, but don’t due to either ignorance or because of some misinformed piece of advice they heard from a neighbor or read in the news.
For Affinity Partnerships, a Pocatello, Idaho-based technology company that builds specific websites and platforms for the purpose of educating a specific target market, this information gap presented an opportunity to bring its services into the reverse mortgage marketplace.
“There is a key need to provide educational materials and an opportunity for deserving citizens to qualify for a HECM,” said John Alexander, president and CEO of Affinity Partnerships. “Because there is a lack of education available—or lack of trust in such information—it’s important that we build a platform for education that can do that.”
In conjunction with a network of several like-minded reverse mortgage lenders, Affinity Partnerships took on the task of creating the USA Reverse platform.
Similar to online lending marketplaces that connect prospective borrowers with mortgage lenders, USA Reverse aims to serve as a critical stepping stone for consumers seeking information regarding reverse mortgages. The platform allows consumers to both learn more about HECMs and, when they’re ready to make a decision, compare reverse mortgage lenders to find a loan that best fits their needs.
“If more people truly understood how the HECM product can benefit them, they would become more interested and start asking the right questions,” Alexander told RMD. “By doing that, the number of people inquiring will expand and the people who can benefit from a reverse mortgage can truly benefit from the product.”
The value proposition of a reverse mortgage is dependent upon a person’s individual situation. With that, it is easy to understand how scary it could be for someone to put their home equity on the line and borrow against one of their greatest assets.
“We want to educate what a reverse mortgage will do for them and put them in contact with reverse mortgage professionals and consultants who could truly guide and instruct them about the loan protections; and encourage them to work with financial advisers, so that the value of a HECM could be fulfilled—which is to provide long-term financial stability and utilize an asset they can actually leverage for a greater use,” Alexander said.
Affinity Partnerships has spent the past 18 months developing the USA Reverse platform; talking to regulators and various consumer groups to make sure that such a resource would truly be of key value—and the company is still not yet finished.
“We know there will be many more expansions and versions as far as the educational materials and tools we will provide,” said Alexander. “Today, we have Phase One. We’re building out a very comprehensive education source for individuals looking to seek information on HECMs.”
Creating, not competing
Right now, USA Reverse has a handful of reverse mortgage lenders on its network, including First Choice Loan Services, Sun West Mortgage Company, Inc., Security 1 Lending and Retirement Funding Solutions, with plans to add more as it continues to develop the platform.
To join the USA Reverse network, lenders must agree to Affinity Partnerships’ code of conduct. Affinity then vets these lender applicants, a process which typically takes anywhere between 60-120 days as the company conducts thorough reviews, background checks and a technology assessment to find lenders who align with Affinity Partnerships’ brand and consumer-centric mission.
“We aren’t looking for the biggest and we certainly aren’t looking for the brightest stars,” said David Villarreal, chief administrative officer for Affinity Partnerships, noting that the company has talked with “virtually everybody” from the industry’s largest lenders to the smaller players.
“We are not looking for volume as much as a cultural appreciation that we’re looking to build with USA Reverse; we’re looking for lenders who complement our philosophy of protecting the consumer first,” Villarreal said.
Affinity Partnerships works with its affiliate lenders to ensure compliance with all state and federal regulatory concerns. Although the company is not a lender, and therefore has no conflict in the process of whether or not a consumer obtains a reverse mortgage, as an educational resource provider, Affinity monitors the information that is being communicated to consumers to ensure its accuracy.
“We can bring more consumers overall to the HECM environment by making sure we provide them an ability to do their due diligence,” said Villarreal. “At the end of the day, we provide consumers greater access to information and data. We really don’t see ourselves competing as much as creating.”
While there is a cost associated with lead generation provided by USA Reverse, Affinity Partnerships is more concerned about conveying effective reverse mortgage messaging for the millions of American consumers who would benefit from getting a HECM but do not due to a limited understanding or general untrustworthiness.
By lending a famous, yet familiar face to its brand, Affinity Partnerships hopes it can help Americans overcome their fears and misconceptions of reverse mortgages.
Danny Glover: Actor, activist, reverse mortgage spokesman
After receiving a few tips and doing some digging around the internet late last year, RMD first discovered the emergence of a new online consumer education platform and reverse mortgage lead generator called USA Reverse. What had initially sparked the interest to investigate this new company even further were its marketing materials, including a Facebook and LinkedIn page featuring the face of none other than actor Danny Glover.
That the reverse mortgage industry would have its newest celebrity spokesman not long after the passing of long-time HECM advocate, former U.S. Senator Fred Thompson, warranted a deeper dive into the many questions surrounding the decision of this yet unheard of company’s decision—most importantly, why would Danny Glover lend his likeness to the reverse mortgage product?
Affinity Partnerships was presented with “a lot” of individuals who could potentially serve as the face of USA Reverse, according to Alexander, however, it was Glover who stood out amongst the candidates.
“From the very first time we met and the extensive amount of questions he asked me, I was prayerful he would even step up to the plate,” Alexander said. “Culturally, it’s about doing the right thing and helping people understand this [USA Reverse] is a tool that can work for them. With Danny’s desire to be a spokesman of education—we’re about providing information, we don’t sell anything—we were aligned in that regard.”
Perhaps best known for his role in the Lethal Weapon film franchise, Glover has also gained recognition for various activism and philanthropic work both in the U.S. and abroad. Apart from his successful film career, Glover has also served as a Goodwill Ambassador for the United Nations Development Program from 1998-2004; a UNICEF Goodwill Ambassador since 2004; and a member of the Board of Directors for the Center for Economic and Policy Research.
“Danny is truly an individual who has the public’s conscience at heart,” Alexander said.
Glover spent a lot of time with the Alexander’s team, probing questions to make sure the messages of communication Affinity Partnerships put out are truly to benefit the consumer and those interested in reverse mortgages, as well as to make sure Affinity’s affiliated lenders on the USA Reverse platform represent the company’s code of conduct.
When it came to selling Glover on the merits of a reverse mortgage, Affinity Partnerships never felt the need to convince him to be the spokesman for USA Reverse. Before meeting with company executives, Glover already built some knowledge of reverse mortgages, having consulted various financial professionals who gave him the good, the bad and the ugly pertaining to the HECM product.
“Danny was already prepared to ask us the types of questions related to the HECM industry, including the history involved and some of the not so good episodes of what HECM borrowers have experienced—things he knew we’d have to answer to,” Alexander said. “He was able to make the determination that he could make a significant impact on providing a very true perspective to the consumer, and minimize all the negative information given to him by advisors who understand the HECM environment.”
That first, meaningful encounter between Glover and Affinity Partnerships lasted almost two hours of conversation, Alexander said, at the culmination of which Danny was satisfied that his philanthropic outlook was going to be met.
“We didn’t have to do a lot of convincing because Danny knew exactly what the message needed to be,” said Villarreal.
“This wasn’t about selling leads,” Alexander said. “Danny really needed to feel confident that USA Reverse would be all about educating and protecting the senior citizen.”
With an esteemed celebrity like Glover on the front lines of company branding, Affinity Partnerships has big hopes to launch and expand USA Reverse in 2016 and the years to come. As to whether the reverse mortgage industry can expect a Danny Glover-helmed TV spot, Affinity Partnerships is playing its cards close, but hasn’t ruled out the possibility.
“We never rule out the potential, but is that potential tomorrow? I don’t think so,” said Villarreal. “But, we are looking forward to expanding with one of the best spokespersons who could serve this industry.”
Written by Jason Oliva