Reverse mortgage loan originators have had to adapt to a host of new difficulties in light of the COVID-19 coronavirus pandemic, one of which being a refinement of the way they aim to connect with new borrowers and get the word out about the reverse mortgage product category. For some, the methods they’ve always used are still effective. As more and more people are seeing different daily circumstances compared with the first couple months of the year, though, that brings both new challenges and opportunities.
This is according to a series of interviews conducted with reverse mortgage originators and brokers from all across the country, who shared their perspectives on the changing business landscape caused by the pandemic with RMD.
Traditional media: steady as people shelter in place
Several originators in different parts of the country have seen steady success using traditional media to connect with seniors. As seniors are the most vulnerable population who can develop serious illness as a result of COVID-19, more of them staying at home means that their televisions or radios are turned on, according to some local markets.
Traditional avenues including television and radio are proving continually effective in Colorado, according to Dennis Zehnle, chief operating officer of leading area broker Silver Leaf Mortgage based in Centennial, just outside Denver.
“I think the traditional channels still work, but it’s more about the messaging,” Zehnle says. “In my opinion, people have to be aware first about what the product is, so we try to take a little bit more of an educational approach in our marketing efforts. And then secondly, what we found has been most effective is the testimonial approach.”
Hearing how great a company in any business is from the company itself can only take the messaging so far, Zehnle says, but Silver Leaf sees a high number of satisfied clients that are enthusiastic about the prospect of sharing their experiences with a broader audience, he says.
“When our target prospects hear from our clients directly and it’s people they can relate to, it creates that sense of trust right from the get-go,” he says. “And then the fact that we’re local, and we can meet with them in person, gives us that advantage or edge over the national players.”
The perennial reliability of traditional media channels isn’t necessarily a national constant according to Rich Pinnell, branch manager at Primary Residential Mortgage, Inc. in Redding, Calif. Since people are sheltering in place, that has the potential to limit some exposure an originator could get particularly on the radio since commutes to work have been affected by the pandemic.
“I’ve stayed on the radio, but backed off a little bit since more people were at home,” Pinnell says. “I think with radio spots, you can be lucky to get a retiree, but you probably couldn’t be if you did drive time. You’re probably going to get a lot of [adult] kids that have a mom and dad who are having a few problems, and then maybe they ought to look at the other options they have.”
Marketing via referral partnerships seems to be a tale of different levels of effectiveness. For Tom O’Donoghue, principal at Reverse Loans Now, focusing on connecting with his local community of financial planners in and around Los Angeles, Calif. has been very successful, since more planners seem to be receptive to the problem-solving potential of reverse mortgages, he explains.
“They are more receptive than they were before [the pandemic],” O’Donoghue tells RMD. “When I first started to call out to them, they would just shoo me away or yell at me. Now, they’ll actually pick up the phone and talk to me for a few minutes, and say that this sounds pretty good.”
That increased level of receptivity can lead to a productive Zoom meeting or an inquiry for more product literature, and has made a significant difference in his ability to connect with planners in and around his community.
“The reception [of the product] has, to me, changed about 180 degrees,” he says. “I haven’t had anybody shoo me away for about the last six months. For me at least, it’s been [a] night and day [difference].”
Lingering pandemic anxiety
This is not the case, however, in the nation’s earliest hot spot for the pandemic in New York, according to Long Island originator Pat Whitlock. The anxiety that still lingers among people in her community is having a direct and negative effect on her ability to network with borrowers and referral partners alike, she says.
“I network pretty heavily, so I’m in touch with my referral partners, but networking has all changed,” she says. “Meetings are virtual, a lot of the side conversations that you might have had at a business networking meeting are gone, so it’s not as effective. Because I’m local, ordinarily I would go visit someone who’s interested and I’d get a referral. That’s just not happening. So, I’m pretty much depending on somebody else to make the pitch, and that often doesn’t work.”
Because New York was initially hit so hard by the pandemic, the lingering anxiety makes it difficult to connect with people in her local community, she says.
“People are still in [a survival] state of mind,” she says. “They’re not thinking beyond the basics. Maybe now they’re starting to, but the news has been grim. Here on Long Island, everybody knows somebody who died. That makes it more [real], and brings it right to your front door.”
Former staffers from HUD, FHA and the GSEs weigh in on how to press ahead in this volatile reverse mortgage climate.