Originating: Know and Become Known
In the June issue of TRR, I wrote about the need for personal integrity in the origination of reverse mortgages. In this follow-up piece, I want to discuss the idea of promoting the integrity of our industry as a whole. That promotion requires reverse professionals to develop a solid understanding of the power of our product and to refine our ability to thoughtfully articulate that knowledge. It would prove tremendously beneficial to our industry if every mortgage originator out there took on a challenge I call “know and become known.” “To know” requires professionals to study up on the product, improve their understanding of its place in a senior’s greater retirement plan and enhance their ability to educate others about it. “To become known” requires one to take this newfound knowledge and use it to connect with senior consumers and the professionals who advise them in order to expand their network and spread the word about the value of the HECM.
Speak to anyone in the industry and you will learn the No. 1 challenge we face is education. The statistic that we have only penetrated 2 percent of the market is constantly noted. We get rightly irritated when The New York Times, CNBC, Forbes or Motley Fool print an article that is inherently false, or worse, when a congressman makes a statement or issues a report about reverse mortgages that is inaccurate or anecdotal. A call to educate has been issued and we all agree, but few actually do anything significantly different to help the mission. We are so busy navigating constant changes from lenders, the FHA and the CFPB, we simply get distracted. The problem is that while we are distracted, an inaccurate article in The New York Times becomes a grandstand moment for congressional representatives, and the inaccuracy is given greater credence and more attention. It is a cycle that can only be prevented when our industry has many effective and well-known advocates. To become one of these, all of us must put in the time to know and become known.
To Know: Improving Your Personal Knowledge
I recently challenged myself with a series of questions:
-How well do I know this industry?
-What am I personally doing to help educate others about this industry?
-How well do I relate to other professionals who work in the service of seniors?
-How well can I articulate the pros and cons of a reverse when speaking to those in other industries?
Realizing that my answers left room for improvement, I embarked on a six-month quest to educate myself not just about our product, but also about the professionals who would see the value in recommending a reverse mortgage to their clients. I spoke with CPAs, CFPs, estate planners, Realtors, geriatric care managers and certified dementia practitioners. It was a challenging, interesting and valuable six months and the results have been exciting and invigorating.
I made it my goal to spend 30 minutes a day researching our industry and everything connected to it. I studied the history of reverse mortgages and read everything I could find, from Ken Scholen’s Retirement Income on the House to recent articles by financial planners espousing the value of a reverse in portfolio management. I met with financial planners, estate attorneys and CPAs, asking for their input on how to communicate the value of a reverse. I learned some of their industries’ fears and even prohibitions with regard to suggesting using reverse mortgages. I realized that in order to be able to teach others, I would have to have a broad understanding of our product and the perceptions others had about it. As I went, I made notes and tried to identify key points that would be important to communicate to others who wanted to learn about HECMs. I read articles about baby boomers and the “sandwich generation” (ages 40-60), and as I read, I confirmed the acute need for reverses and value they offer.
To Become Known: Expanding Your Network
The next part of my quest was to become known. This is going to be an ongoing task, as it is an uphill climb, but I believe it to be essential to my personal business and to our industry. It seems to me that we have a problem when it comes to media coverage on reverse mortgages; there are not many known reverse experts that media outlets turn to. It is not uncommon for media outlets to quote CFPs who get to comment—not because they are experts on reverse mortgages, but because they have established themselves as a source for financial reporters. It is my goal to ensure that when The New York Times or any other national or local media outlet runs a story on reverse mortgages, they are able to locate and seek input from numerous HECM experts. But for the most part, experts in our industry are not visible at that level. We have to get better—as loan officers, branch managers, account executives, etc.—at making ourselves known to the media so there is a fair balance in coverage about the product.
We have seen some fantastic, positive articles in the press lately, but how many of us have read the recent academic articles, such as “The Stand by Reverse” or “The 6% Rule,” and can articulate the value in them? Are we content with simply reading the Reverse Mortgage Daily synopses without understanding the details that are so carefully extolled in the articles? How many of us have a plan to educate CFPs, CPAs, Realtors, geriatric care managers and estate attorneys? How many of those professionals do you have in your network? Our industry is still young by many standards, and we have an enormous uphill task to overcome the misconceptions out there. I would encourage every reverse mortgage professional to immerse themselves in this field. Don’t dabble in the industry; know it well and be able to articulate its benefits to both seniors and other professionals who serve them.
In my last article, I wrote about sitting at the kitchen table and watching a senior’s reaction when they see what a reverse can do. Since I started my question to become known, I have had new opportunities to enjoy the reactions of others. I have done a radio show and have taught a four-credit CPE class for CPAs. I have done numerous presentations to many in the financial industry. Through my efforts, I have learned of a new, equally exciting experience: sitting at a conference table and watching the reaction of those I educate about reverse mortgages. I think their jaws drop a little further than the seniors’. Has it helped my business? Absolutely! Has it had an impact on the industry? I’d like to think so. Imagine what can happen if just a quarter of us in the industry did the same thing. I can sum up the impact by sharing survey results from my CPE class. Before the class began, 90 percent of those attending were not comfortable recommending reverse mortgages for their clients, and 30 percent of them strongly disagreed with the concept. After the class, 70 percent agreed with recommending a reverse, and the remaining 30 percent were neutral. Not one of them said they still disagreed with the product; one CPA said his response changed from “No Way!” to “A lot of possibilities!”
The more we educate others, the more we will overcome our industry’s problems and the media’s bias. Let’s all know and become known!
Original Article
NEW HECM 