Mutual of Omaha Mortgage President Talks Reverse Mortgage Priorities, New Structure

Late last year, reverse mortgage lender Retirement Funding Solutions (RFS) – a subsidiary of Mutual of Omaha Insurance-owned Synergy One Lending – announced that it would be changing its name to Mutual of Omaha Mortgage to reflect its association with its parent company, and signified an effort on Mutual of Omaha’s part to align its reverse mortgage business more closely under a unified brand identity.

Now that we’re well into the year 2020, Mutual of Omaha Mortgage is better equipped to communicate with customers the unified brand identity, since the Mutual of Omaha name is well-recognized in the lending space. To get an idea of what current operations are looking like after the rebranding, RMD reached out to Mutual of Omaha President Alex Pistone, who provides an update on what the company landscape is looking like in 2020.

What the new ownership means

It was in the middle of 2019 when it was announced that Mutual of Omaha Bank would be acquired by Pasadena, Calif.-based CIT Bank in a deal valued at $1 billion. That merger, however would not include mortgage arm Synergy One Lending, under which the former RFS operated. As part of the acquisition, the ownership of Synergy One Lending shifted to Mutual of Omaha Insurance Co.

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Despite the change in name and ownership, the dedication to the senior customer on the part of the Mutual of Omaha insurance company is very apparent in the priorities of the company, Pistone tells RMD.

“The Mutual of Omaha Insurance Company has a special focus on the needs of older Americans,” he says. “We have a deep understanding of this customer and the challenges that they face. We believe the role of the reverse mortgage in retirement will be even more important and mainstream in the future, which will help millions of homeowners.”

Because of that understanding, Mutual of Omaha plans to take a leadership role in the industry by investing in serving senior customers in a meaningful way, he says. In terms of how well reverse mortgage products fit into the larger landscape of Mutual of Omaha Insurance, Pistone says that the fit is a more natural one than someone might think.

“The reverse mortgage product is a natural fit within Mutual of Omaha’s business, which includes senior-based insurance products and wealth planning,” he says. “Mutual serves millions of senior customers today. We see a tremendous opportunity to serve existing customers as well as bring new customers into the Mutual family.”

How the name change has affected outreach

When the name change was first announced late last year, Pistone told RMD that the potential for further connection with senior customers increased because of the general recognition that comes with the Mutual of Omaha brand.

“Mutual of Omaha is a 110-year old company with a respected and trusted brand,” Pistone said in November. “We believe the Mutual of Omaha brand will help open more doors for our originators, both with customers as well as referral partners. We have already started to see this happen.”

When asked if that trend of opening more doors with seniors has continued into the here and now, Pistone replied in the affirmative, while reinforcing that even more proverbial doors have opened for the company’s loan officer corps.

“Absolutely! The Mutual of Omaha name and reputation resonates with our customers,” he says. “They trust the brand that they grew up with, which provides us with the opportunity to educate and clear up misconceptions. I am also seeing doors open with strategic partnerships, which allows us to explore new opportunities for growth. The Mutual of Omaha brand is definitely an advantage for us.”

Retiring RFS, and what the future holds

The retiring of a brand name that has been prevalent in an industry is not often an easy decision, but when it comes to what is now Mutual of Omaha Mortgage, the decision was made at least a little easier due to the transition to an already well-established brand, Pistone says. Additionally, the lack of a universally ubiquitous brand in the reverse mortgage space made the decision about the RFS name a bit easier compared with other scenarios that companies have faced in the past.

“If you think about it, there is really no recognizable brand in the space today, and that includes the RFS brand,” Pistone tells RMD. “It was an easy decision to move our brand to Mutual of Omaha Mortgage. We are able to take full advantage of the reputation and trust that Mutual of Omaha has built over the last 110 years, specifically with our age demographic.”

In terms of what the future holds for Mutual of Omaha Mortgage, Pistone says that there are new resources in place that will help the company to appropriately scale its growth for the remainder of the year and beyond.

“At Mutual of Omaha, it is our mission to help our customers protect what they care about and achieve their financial goals,” he says. “We exist for our customers, and we plan to leverage our resources to build a foundation for growth in 2020 and beyond, so we can help as many customers as possible.”

Mutual of Omaha Mortgage was first established in 2015 as Retirement Funding Solutions, a subsidiary of Synergy One Lending, by Torrey Larsen. Larsen previously served as head of Security One’s retail lending division, and served as company president prior to Security One being acquired by Walter Investment Management Corp. in 2013. Mutual of Omaha first announced its purchase of Synergy One in May of 2018, and the deal was finalized that July.

As of February 2020, Synergy One Lending is the sixth-largest reverse mortgage lender by volume, according to data from Reverse Market Insight (RMI).

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  • Mutual of Omaha (MOO) acquired Synergy One in July 2018. Synergy One had 2,971 HECM endorsements in fiscal 2017 and was the sixth largest lender by endorsement count that fiscal year. The following fiscal year Synergy One had 2,657 HECM endorsements and again sixth lender by endorsement count. While the endorsement count for Synergy One for fiscal 2019 fell to 1,881, it was the fifth largest lender by endorsement count. But let us look at an acquisition 12 years ago by MetLife Bank.

    In June 2008 we saw the acquisition of Everbank Reverse by MetLife Bank. Everbank Reverse had 109 endorsements and did not make the top 70 lenders by endorsement count for fiscal 2007. Fiscal 2009 ended with MetLife as the number six lender by endorsements. By the end of the next fiscal year, Metlife was already the number three lender by endorsements. By the end of fiscal 2011 (with the loss of Bank of America’s HECM origination operations) Metlife was number two by endorsements.

    By the end of fiscal 2012, MetLife was number one by endorsements but a little over half way through fiscal 2012, Metlife announced it was closing reverse mortgage origination operations.

    While the history of the two acquisitions (and the first two years thereafter) are quite different, it seems as if MetLife Bank was ready to lift the origination operations of Everbank Reverse rapidly to the top of the industry in a hurry. Will MOO Reverse reach number three by the end of this fiscal year? Reading Alex’s comments, it seems like he is on board with that assessment. That assessment is definitely optimistic, is it realistic? As of February 29, 2020, for the first five months of fiscal 2020, MOO had slipped back to the number six.lender; yet MOO was only 2 endorsements behind FAR which was the number five lender.

    Another key fact is that the endorsement count for fiscal 2019 for Synergy One was 36.7% lower than for fiscal 2017. The industry drop between the two fiscal years was 43.5%. The Synergy One drop is much better than the percentage drop in endorsements for the industry as a whole. So while the situation is not as spectacular as the one at MetLife, it is still a positive one and one that should not be overlooked or ignored.

    Without brick and mortar offices with “high retail foot traffic,” it seems that in the midst of poor HECM endorsement performance by the industry as a whole, MOO is hopefully on a positive footing for growth this fiscal year and in the future.

  • “If you think about it, there is really no recognizable brand in the space today, and that includes the RFS brand,” Pistone tells RMD.
    What about the AAG brand with company spokesman Tom Selleck. Mutual of Omaha has a long way to go to get anywhere near 10,000 originations a year.

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