Mahwah, N.J.-based reverse mortgage lender Longbridge Financial has launched a new initiative aimed at broker partners called “Reverse Made Easy,” designed to streamline the process for new brokers to incorporate reverse mortgages into their lending operations.
For those brokers who are interested in reverse business but have little-to-no familiarity with its processes, Reverse Made Easy is designed to incorporate reverse operations more effortlessly especially as forward brokers begin to more readily recognize the potential of reverse mortgages.
Designed from the ground up to walk broker partners through all the necessary steps to begin their journey into the reverse mortgage business, Reverse Made Easy stems from both a desire to expand broker partnerships as well as current events, including the exits of major financial institutions from the home equity lending landscape. This is according to Adrian Prieto, head of wholesale lending at Longbridge.
What it is, how it came to be
“Reverse Made Easy, or RME, is our turn-key program designed to offer a full suite of services and support to brokers who are relatively new to reverse,” Prieto explains. “It allows them to easily originate reverse mortgages to serve more clients and diversify their business – with no reverse mortgage experience needed. Our experienced sales and operations teams take a hands-on approach in assisting broker partners throughout the entire process from start to finish.”
Forward brokers’ recognition of reverse as a way to better serve older clients is a factor in the development of the initiative, but recent events stemming from the COVID-19 coronavirus pandemic’s effects on the home equity lending space have played a role as well, Prieto says.
“There is a large market of forward brokers who can benefit from expanding their portfolio with a product better suited for the senior market, especially considering lenders recently suspending their HELOCs programs,” he says. “In fact, we’re working on a strategic distribution partnership with a large forward lender with an expansive broker channel who realizes the opportunity.”
Other elements — including the increasing prominence of Longbridge’s “Platinum” proprietary reverse mortgage product suite and a growing sales team of account executives — make the idea of a renewed appeal effort aimed at brokers very natural, Prieto says.
“We are well positioned and extremely committed to serve this market,” Prieto adds.
How it works, interest so far
For brokers who express an interest in RME, Longbridge account executives take the lead in structuring how the new reverse component of a broker’s business will function to that the brokers themselves can get to work finding the clients.
“Our Longbridge account executives assist the broker partner in loan structuring, proposal generation, application documents, and more to help them get up and running,” Prieto explains. “We offer full loan-processing functions, allowing brokers to maintain focus on finding their next loan. Longbridge also provides closing support to streamline the loan-closing process on their behalf. We do everything from beginning to end.”
While the program has only been active since the beginning of the year, it has already had a demonstrable impact on the network of brokers doing business with Longbridge to expand the availability of reverse mortgages, Prieto explains.
“Since we rolled out RME in January of this year, we have signed up over 120 new broker partners,” Prieto says.
Finding new solutions, broker product perceptions
Since the RME program primarily targets forward brokers who have very little experience with reverse, Longbridge identified an opportunity to tailor the offering specifically to brokers who are very acutely aware of forward market norms to be able to provide an ample amount of understanding to the reverse side, so that the proverbial “key” can be turned with greater ease.
“Most of the brokers who we are targeting are mainly focused in the forward market and mostly familiar with only forward products,” Prieto says. “They don’t necessarily understand or have time to learn all the nuances of reverse, such as a new LOS system. The Reverse Made Easy program provides everything they need to get up and running so they can focus on building their business.”
That general lack of familiarity also tends to extend to some of the perennial reputational hurdles that the reverse product category tends to run into, but brokers’ understanding of reverse as a potential difference-maker from a revenue perspective is itself a helpful factor when it comes to educating about the reverse business.
“From a distance, [brokers] recognize that the product can be a good revenue generator for their bottom line, but also tend to have a belief that the product is difficult to understand and scale,” Prieto says. “However, with the recent decrease in the availability of forward products like the HELOC, more brokers have turned to us for products like our proprietary Platinum LOC, to fill that void for some of their clients.”
Outreach to potential partners, the future for RME
In terms of informing brokers about RME, Longbridge is taking a hybrid approach of answering incoming inquiries from potential partners while also performing its own outreach to interested parties, Prieto says.
“We take a combination of various measures to reach approved partners and prospects alike,” Prieto says. “I’ve been around a lot of reverse AEs the past several years and ours have the right combination of experience and hunger for prospecting and developing new accounts. I also think our wholesale marketing is exceptional and is always creating valuable content to stay relevant.”
Several new broker approval requests are being managed every month, Prieto adds, and the company sees this as only the beginning.
“We believe we’re only getting started,” Prieto says. “Most of these brokers tend to originate one or two reverses a year, but we plan to continuously market fresh and relevant ideas to them about the benefits of reverse so that they better understand the value, resulting in an increase in loan submissions.”