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Why Canada’s Reverse Mortgage Lender Revamped its Online Approach

In just three years, the only national reverse mortgage lender in Canada boosted its online lead generation from 20% or fewer of all consumer inquiries to 90% — a shift that the bank attributes to a no-frills website and the increasing tech-savviness of Canadian seniors.

But the push toward web-based outreach at HomEquity Bank wasn’t without issues, according to vice president of digital strategy Vivianne Gauci. Back in 2013, when the Toronto-based lender of CHIP reverse mortgages — the privately-offered reverse mortgage program in Canada — decided to commit to boosting its online inquiries, HomEquity first opted for a glitzy, “Web 2.0” approach, Gauci says.

“Back when we first started looking at our website, we redesigned it with the idea that we would use all of the best practices at the time,” Gauci tells RMD, describing a “sleek” site with lots of bells and whistles.

The “fancy” website had the opposite effect: On-site conversion rates, or the percentage of people who contact HomEquity online and then eventually end up calling to potentially initiate the loan process, “tanked,” Gauci says.

So the digital team went back to the drawing board and realized that most people who came to the site wanted to quickly determine how much money they could get with a CHIP based on their homes, and didn’t much care for any of the fancy add-ons. 

“So we took a step back and used a lot of white space, big buttons, and a carousel, which were not as advanced, or avant-garde, or as sleek as you would have seen at the time, but that design actually worked a lot better with our audience,” Gauci said. “We were very clear and straightforward about what people needed.”

If you build it

Of course, building an easy-to-use website isn’t the only step in increasing online leads — you actually need to get people to find the link and click. HomEquity uses all the usual suspects, from paid search terms to banner display ads to Facebook, though the type of consumer who comes in through each channel can vary greatly.

For instance, people who find the HomEquity website through organic Google searchers tend to have the highest on-site conversion rates, as they’re already informed enough about the product and the company to seek it out on their own. That’s why conversion rates for searchers can hover in the teens, Gauci said, while display ads can only generate conversions in “the low single digits.”

An age advantage

Overall demand for reverse mortgages has increased steadily in Canada, as RMD reported earlier this year: HomEquity generated a record $60 million in originations in May, a year-to-date increase of 35%, amid demographic shifts that have seen Canadians aged 65 and older overtake children younger than 15 for the first time in the nation’s history.

When pitching to potential borrowers online, HomEquity has the advantage of a lower age threshold: Unlike the Home Equity Conversion Mortgage product in the United States, which is available only to homeowners aged 62 and older, Canadian borrowers can get a CHIP as early as age 55. And those seven years can make a difference in terms of comfort with online platforms, though the company noted in a recent release that the average age of a HomEquity borrower currently sits at 72.

“Yes, we do have a lower age limit. We do definitely see that our average age coming through online channels is lower than the rest of our business,” Gauci says. “So there’s definitely that fact there, but I just think, in general, that seniors are becoming more comfortable.”

She pointed to internal statistics that show potential borrowers increasingly come to the HomEquity website after seeing the bank’s television commercials, which air nationwide in Canada — instead of calling the number on screen. 

And Gauci emphasized that for all the push into online lead generation, HomEquity doesn’t intend to replace flesh-and-blood loan originators and brokers with an online platform.

“Similar to any other company, we’re not selling mortgages online,” Gauci says. “The idea for the website is to engage people and get them to a point where they want to have a conversation with us.”

Written by Alex Spanko