With the reverse mortgage market under more scrutiny than ever, loan officers must work twice as hard to secure successful loans. And while most mortgage lenders agree the new Financial Assessment rules are better for everybody involved, that doesn’t stop most of us from griping over the extra work. It’s time for a little perspective.

For the greater part of the last two decades, reverse originators have had the luxury of churning out loans like a well-oiled machine. Without having to take a borrower’s credit history or financial circumstances into strong consideration, the reverse loan process was less about building trust with customers and more about showing them where to sign on the dotted line. Along the way, we lost sight of the key relationship between loan officer and client—and forgot about the human behind the mortgage file.

The new financial requirements set in motion by HUD in 2015 serve as a wake-up call                              for the entire industry. With the risk of loan rejection now firmly a reality and annual volume down overall, it’s clear that the previous “churn and burn” cycle of the reverse mortgage market is grinding down, leaving reverse originators no choice but to sit back and re-evaluate the business. Our solution? Put the customer first and get back to the basics.

A Return to Customer Service

With the rise of online lending and other financing options, a lender’s regionality no longer holds the same assurance of business as in years past. Even in recent years, a mass marketing campaign may have been rewarded with a rush of foot traffic. But today, reverse originators must earn their business the old-fashioned way: through personalized customer service.

More than 75 percent of consumers say they view customer service as the “true test” of how much a company values them, according to the 2015 Aspect Consumer Experience Survey. A second study, by Walker, suggests that customer experience will overtake product or service as a key brand differentiator by 2020. In today’s reverse mortgage environment, good customer service can truly set you apart from the competition.

It’s no secret that the changes to our industry have impacted the reverse mortgage process. With the addition of the new Financial Assessment rules, we now face longer application-to-approval timelines, which can greatly affect a customer’s perception of our companies and services. It’s up to us to manage our customers’ expectations and provide them with the necessary guidance along the way, even when loans are denied.

That doesn’t mean that email campaigns or marketing automation technology is going anywhere soon, of course. It does, however, mean that reverse originators need to make customer service a top priority.

By now you’re probably thinking, “But Brad, we already have good customer service. What gives?”

The truth is, every business says they have great customer service, yet few invest the time or energy into creating an actual customer service strategy (and customer service studies frequently show companies miss the mark).

A customer service plan is not simply being nice or friendly to customers. It’s a proactive approach that includes everything from making a customer feel comfortable to getting employees to understand how customer service helps meet business objectives.

Creating a Customer Service Strategy

Having a solid customer service plan in place can help push potential clients through the sales pipeline, improve customer retention and satisfaction rates, and lead to referrals—all of which can boost the bottom line.

While there are countless modifiers that affect what customer service program will work best for your reverse mortgage company employees, a good example of the general process is offered by The Thriving Small Business.

Seven steps for developing a customer service strategy:

Create a customer service vision: Work with your team to lay out your customer service goals. Do you need to speed up the process? Is most of your customer communications conducted through email? Maybe it’s time to add a phone call into the mix. Once you’ve laid out your goals, make sure to communicate this vision to your employees.

Assess customer needs: Before launching a customer service strategy, it’s important to gather feedback from customers. This can be done through customer surveys, focus groups and comment cards. Understanding how your customers feel about the application and approval process provides key insights into how you’re doing—and what areas need work.

Hire the right employees: No matter how well-executed your customer service initiative is, it can’t be executed without great employees. While specific skills can be learned, a winning attitude cannot. Connect with HR to ensure that effective screening and pre-employment testing is in place so that employees make the grade.

Set goals for customer service: Following customer satisfaction assessments, identify the areas that need improvement and set a goal to turn things around. Asking employees to contact customers who fill out a contact form within 24 hours, rather than three days, for example, could upgrade your customer service levels.

Train on service skills: Whenever you make a change to your customer service program, employees should be informed of the adjustments and trained on how to execute them. This could be as simple as deploying a standard phone greeting, or as complex as handling customer complaints or issues.

Hold people accountable: When employees are putting good customer service into practice, transparency is important. They need to know if their hard work is paying off, or if they need to dig a little deeper. Don’t be shy in sharing organizational performance updates or in talking to an employee who isn’t measuring up.  

Reward and recognize good customer service: On that note, recognize when an employee does a great job! Set up an incentive program, treat them to a catered lunch or dole out a small cash bonus.

When it comes to customer service, positive employee morale goes a long way. According to Temkin Group, satisfied employees are three times as likely to do something good for the company that is not expected of them—which means they are more likely to go above and beyond for your reverse mortgage customers.

Understanding Your Future Senior Buyers

Once you’ve established a customer service initiative, it’s equally imperative to understand your future senior buyers. It’s a mistake for reverse originators to put customers into two distinct categories: borrowers who qualified for a reverse mortgage loan, and applicants who did not. We too often focus on the former and ignore the latter.

Seniors who secure successful reverse loans and receive great customer service are much more likely to refer their peers to your company. But there’s actually opportunity in both groups. It may seem counterproductive, but steering customers who face credit problems toward financial counseling, for example, could help generate business in the future.

In our business, the people who often fail to get approved need to tap into their home equity the most, whether it’s to fund home maintenance, purchase a new home or pay for medical expenses. They shouldn’t be left behind.

This realization has caused mortgage professionals to evolve from being simply “loan officers” facilitating red tape, into the more complex role of a reverse mortgage advisor. Acting as an advisor requires loan officers to understand each customer’s unique needs, then put together a plan of action so they can benefit. The extra care and empathy employed by loan originators is likely to be rewarded with business, now or later. It pays to stay in touch and see where you can help.

In fact, for all the discussions surrounding millennial homebuyers, few loan originators go out of their way to understand the senior set. Seniors put more stock in businesses that answer quickly to an inquiry; prefer thorough explanations of the purchasing process; and respond better to direct mail with visuals, nostalgia and clichés, rather than modern jargon and trends, according to Direct Marketing Center. That being said, seniors are increasingly tech-savvy, so make sure you have a healthy balance of communication.

Since the launch of FA 2015, we’ve ramped up our telemarketing efforts in an attempt to jumpstart a personal conversation around reverse mortgages, and have implemented key communication touch points to keep customers fully informed and engaged. We also employ several “check-in” phone calls, send handwritten thank-you cards through snail mail and send small gifts (like gift cards or trinkets) to show our appreciation for their business.

While some may regard tools such as telemarketing or thank-you cards to be “old school,” we think it proves to our customers that we value them as a person—and not just as a lead pursued through our mass marketing efforts. The last thing we want our customers to feel is that they are a number or a path to profit.

A Market Full of Opportunity

Despite the new financial regulations, there is still a lot of opportunity in the reverse mortgage industry. Pew Research Center estimates that roughly 10,000 baby boomers retire each day, and it’s likely that the reverse mortgage market is going to grow once again. As the reverse market stabilizes, tapping into good ol’ customer service is only going to make our business better.