Reverse Mortgage Alert product notifies lenders when borrowers qualify
Sales Boomerang, an automated borrower intelligence and retention system platform based in Baltimore, Maryland, this month announced the launch of a new product, “Reverse Mortgage Alert.” The purpose, similar to other customer intelligence products offered by the company, is designed to notify a lender when a borrower in their system would be a “good fit” for a home equity conversion mortgage (HECM) such as administered by the Federal Housing Administration (FHA), or an exclusive reverse mortgage with higher loan limits.
The alert can trigger based on different parameters chosen by the lender, such as when a borrower is both eligible at age 62 or retains enough equity in their home to potentially qualify for a loan reverse mortgage. Describing the opportunity in terms familiar to the reverse mortgage industry and given the record levels of home equity accumulated by seniors, company officials see the industry as a largely untapped resource according to public statements and conversations with RMD.
The Reverse Mortgage Opportunity
One of the reasons the company decided to enter the reverse mortgage business was due to the perception of it as a largely untapped market and an opportunity to educate lenders on the possibilities of a such loan. That’s according to Mike Spotten, vice president of product at Sales Boomerang.
“With untapped real estate capital at an all-time high, this latest expansion to our award-winning suite of automated borrower intelligence and retention alerts is extremely timely,” Spotten said. “By enabling reverse mortgage alerts, Sales Boomerang users can create healthier lending pipelines while helping customers access lending options they would otherwise have learned from a competitor – or perhaps they haven’t learned at all.”
Adding the reverse to the product alert suite already offered by Sales Boomerang was a natural fit for the company due to favorable demographics and a desire to be as comprehensive as possible in the mortgage space. That’s according to Richard Grieser, vice president of marketing. Some pre-existing alerts offered by the company include if an existing borrower at one lender inquires about options at another organization, which may allow the original lender to re-engage with a borrower for repeat business.
An increase in home equity over the past year has also fueled another alert product the company offers for the removal of mortgage insurance, if a borrower’s credit and net worth situation s improves enough. Equity growth on this side of the business was one element of the decision to roll out the alert product focused on reverse mortgages. However, the number of reversal-related inquiries the company was responding to also increased significantly, leading to the development of the Reverse Mortgage Alert, Grieser says.
“For a long time. Many companies have contacted us and [ask if we do] anything for reverse mortgages or other types of products, and the answer was no for a very long time,” Grieser told RMD in an interview. “Now we have this alert, which we just rolled out because a lot of our customers were asking for it. What this alert does is notify the lender just when one of their borrowers in their database might qualify for or qualify for a reverse mortgage.
A Journey of Understanding, Current and Future Lenders Served
As is often the case with people who have not had much prior direct interaction with the reverse mortgage industry, the staff at Sales Boomerang had to go through an educational journey regarding the intricacies of the reverse market.
“We had to do a ton of education, and the way we’ve done that is with a bunch of interviews with our customers who offer reverse mortgages,” says Grieser. “We just talked to them about what they would like to know, whether this type of alert is something they would be interested in or not. First of all, we were just having conversations to talk to them about when and how they offer a reverse mortgage: borrower must be 62 or older, we’ve discussed why people decide a reverse mortgage is important.
Many of these conversations described the majority of borrowers as needing extra cash to bolster their retirement savings. Additional research and self-directed insights from conversations with lenders led the company to develop various parameters by which the Reverse Mortgage Alert can be triggered.
“You can set the age threshold to whatever you want and then we literally notify [the lender] by the time someone reaches an age where they qualify for a reverse mortgage,” Grieser says. “If I was setting an alert, I’d probably set it to 61, because I’d probably have a quick chat a bit early to prepare [the borrower] for the option. And then you can set the house value, you can, of course, adjust the value of the house value range [the lender is] looking for.”
An alert can also be set up depending on the amount of capital that a senior has built up in the home.
“The roadmap for where we can take this product in the future is quite exciting,” says Grieser.
Future opportunities, the potential of reverse mortgage partnerships
When asked if such an alert could be issued to a lender without a dedicated reverse mortgage offering or division to fuel brokerage partnerships, Grieser said it was not on the table until here. That could be in the future, though.
“The lenders we’ve all signed up to so far have their own ability to offer the reverse mortgage right now,” says Grieser. “[In the future]we may be able to tell our lenders that they could offer a reverse mortgage to certain eligible borrowers and then show them how they could actually do it through a third party or someone else.
When asked what he and Sales Boomerang would most like to communicate to the public about RMD’s reverse mortgage industry, Grieser explained that having good information about the ideal time to offer a mortgage is key. reversed.
“There are a lot of people who need a reverse mortgage product,” he says. “You’re doing borrowers a disservice by avoiding a conversation with them when they need help. We know when someone needs a reverse mortgage. Talk to us, we’ll let you know when they do. It’s so simple. Lenders shouldn’t play guessing games or reach out to people who simply don’t qualify. We’ll let you know as soon as someone qualifies.
See the dedicated product web page at Sales Boomerang.