Originating: Putting First Things First

Written by Brett Varner, as originally published in The Reverse Review.

In my experience working with reverse mortgage originators, the efficient use of time has been a constant theme in my observation and training. As the old adage goes, sales is a numbers game. A key element of success is to get yourself in front of as many prospects as you can on a consistent basis.

After receiving a new lead, many originators get caught in a little conundrum of where to start working on that lead. The amount of information provided initially with a new lead depends on its source and whether it was received directly or through a third-party provider. That information leads to a “chicken or the egg” type of consideration for the originator. Is it better to start using the information to conduct initial research to determine what the lead may qualify for, or is it better to connect with the prospect and evaluate where they are in the buying process?

I always encourage originators to connect with a prospect before doing any research, because that initial conversation will define the landscape of the lead, verify information and determine what is important to that prospect. What is learned about the prospect in that initial contact will determine what the originator needs to do next in their research and the level of information that needs to be provided for that prospect to be comfortable moving to the next step in the sales process.

Some originators feel it is important to know as much about that lead as possible before making the initial phone call or contact. They will research home values, try to verify information and run their numbers. In some cases, they will attempt to set up the sale before really knowing anything about the prospect. A significant amount of time is invested in this endeavor and can have a disastrous impact on efficiency and the ability to connect with as many prospects as possible.

I know some will argue that time spent “pre-qualifying” leads allows originators to only focus on those they determine to have the highest potential. However, I would warn that using that approach leads to unfocused time spent on trying to pre-qualify leads without having sufficient information to assess that level of potential. The information received with a lead is not always accurate or complete, and certainly doesn’t relate the interest level of the prospect. Generally, a new lead is merely a person who has expressed interest in learning about a reverse mortgage. It does not, however, explain why that person has an interest or what their need is.

This is an often overlooked aspect in reverse mortgage sales. Originators will focus on the qualifying information: home value, age, mortgage balance, product choice, and ultimately, net cash available. Although it is certainly important to understand these components, they don’t provide the total picture of how the reverse mortgage product can fit into a prospect’s life: the “why.”

This is why the initial conversation is such an important touch in the sales process and should be completed before any sales research is conducted. This touch starts by simply connecting with the prospect and taking a read of their sales temperature. The goal is to determine what is important to them, the source of their interest and what they need to know to make an informed buying decision. Is their goal to resolve an issue quickly or do they need time to consider information and evaluate how the reverse mortgage product can be a benefit to them?

The second aspect of the initial touch is to verify information received and determine what additional information can be provided to help give that prospect the most accurate picture of how the reverse mortgage may (or may not) fit into their needs. When a prospect makes an initial inquiry, they don’t necessarily know the information they should include, or may not be willing to provide it at that time. Simple data points, such as a younger spouse on title, a second mortgage, or long-overdue maintenance can have significant impact on the qualifying information. An originator couldn’t know this information initially without connecting with a prospect and asking the right questions.

It is the prospect who can not only verify key qualifying information, but also provide insight about their home, their neighborhood and their needs that can guide an originator’s research and define the type of presentation necessary to further the lead through the sales cycle. That initial conversation can also identify components that would cause a lead to not be able to qualify for a reverse mortgage, or their goal cannot be realized through a reverse mortgage. It is only the prospect that can provide the necessary information to fill in these gaps and help the originator determine what is possible.

Using a simple example, say an originator receives a lead and uses their resources to determine that the prospect would be short to close by $10,000 with a reverse mortgage. At this point, does the originator have sufficient information to disqualify that lead? It is easy to assume that this prospect would not be worthy of investing time. However, what if this prospect had significant savings that were slowly being drained due to a lack of income and a $1,200 mortgage payment? For this prospect, it may be worth considering using other assets to cover the shortage in order to retire the monthly mortgage payment. In this scenario, it would be in the ninth month of a reverse mortgage that the prospect would have recovered the $10,000 invested in the reverse mortgage from not having a mortgage payment and would have an increased net cash flow of that $1,200 from that point forward. This type of solution could have a major impact on the longevity of the prospect’s retirement assets and can only be determined through interaction with the prospect and understanding their entire scenario.

The opposite can also be true. Say, for example, an originator receives a lead and immediately focuses on researching home value and running numbers with the goal of being prepared to present the prospect with details on their qualification. After compiling the information, the originator calls the prospect, only to find out that he has a spouse who is only 58 years old.

In any type of research, the first point of order is gathering information. It is about defining what is known before attempting to learn what is unknown. This is why I do not find this scenario to be a “which should come first” debate. It is more of a “putting the cart before the horse” type of situation. It cannot be efficient to skip over the information assessment step to try to define the landscape of a lead with partial facts.

The first step in prospecting should always be connecting with the prospect, and not only verifying the key data points for qualifying, but also defining the key “why” that they are trying to solve through the reverse mortgage. Beginning with this starting point is a more efficient use of time than attempting to conduct research with limited facts. It also helps the originator shape their presentation around the needs of the client. In addition to creating more productive use of an originator’s time, the result generates more personalized attention and a higher level of service to the prospect.


3d rendering of a row of luxury townhouses along a street

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