Reverse mortgages are such a feel-good product. The tangible and positive difference we make in our clients’ lives is easy to see. And yet the grind of finding clients and the financial pressure of making a sale often detracts from the good we do. What if there were a way to systematically build a reverse mortgage practice based entirely on referrals from professionals you knew, liked and trusted?
What if all your clients came from people who respected you and respected reverse mortgages as a financial tool? The key to origination success is consistent, predictable lead generation at a reasonable cost. At scale, consumer-direct can be effective, however, it is capital-intensive and difficult to maintain a sustainable competitive advantage—others quickly copy what works and conversion rates drop. The most profitable and efficient lead is a referral accompanied by an endorsement. The big question is: How do you build that type of practice in one year instead of 10?
The most likely referral sources are those who come in contact with large numbers of people who may need our services. Everyone knows this, but they lack strategy, tactics and patience to build relationships with financial and senior services professionals who can refer ideal prospects. Regardless of how brilliant you are, it takes time to build relationships and educate referral partners. However, it is easier to be patient when you’re confident your daily habits will yield results.
This article aims to provide insight and an actionable plan to help you build a sustainable, profitable reverse mortgage practice and minimize unproductive marketing investments and activities.
Most originators are not sure how to approach and engage professionals who often have more credentials and education than they do. The single best source I have found to address this legitimate concern is found in the book High Trust Selling, a New York Times best-seller by Todd Duncan. Chapter 11 provides an excellent roadmap on how to target, build value, set appointments, interview and help solve the types of problems we are uniquely positioned to solve with the use of a reverse mortgage.
Let’s start with a Stephen Covey quote: “Begin with the end in mind.” Our ideal end-state, strategy and goal is to work with eight to 10 financial services professionals who know, like and trust us, and who each refer two prospects per week. Ideally, we want one to two strong relationships in each of the following categories:
-Financial advisors -Insurance agents -Estate planning attorneys -Elder law attorneys -Accountants/CPAs -Senior care specialists -Realtors
Diversification of referral partners creates its own synergy. By making good recommendations when clients ask for referrals, we distinguish ourselves as trusted advisors (instead of salespeople).
So how do we build these eight to 10 key referral partner relationships? Obviously, they won’t end up being the first 10 people we talk to; we may have to meet with four to get one. And this is not a cold-call game. This is where we leverage social media connections. Who are you already connected to who is a professional in one of the target categories?
For this article, I approached financial services professionals who were first-level LinkedIn connections. I sent individualized versions of the following message to 236 of them with a link attached:
I’ve been invited to write an article for The Reverse Review magazine, an industry trade publication. It is an honor and I want to add value to the audience. You can help me if you’d be kind enough to complete a 60-second survey. Please visit: reversequestionnaire.com.
The infographics that accompany this article are a compilation of results of the 73 who responded.
Can you do something similar in your local market? Of course you can! Tell them you’re writing an article for your website. Or, how about copying the survey and using it as the basis for a one-on-one conversation?
Leading with a survey is a great way to build a relationship. Again, from Stephen Covey, “Seek first to understand, then to be understood.” The best way to understand is to ask and listen. By the way, my survey was purposely designed to address concerns or misconceptions and then end with the strong points of reverse mortgages. I did not want it to seem like a sales pitch.
Tactically, your approach might look like this:
-Survey financial services professionals you’re connected to on LinkedIn.
-Meet for coffee with those who rated reverse mortgages favorably or called themselves a “raving fan.” If you need more prospects, also meet with those who had no opinion.
-Start the meeting by asking, listening and learning about their professional practice. Ask about their ideal client profile. Try to keep the balance of the meeting more focused on them. Any meeting where you talk less than 50 percent is a good meeting.
-When they ask about you, after sharing some personal information like how and why you got into the business, slide your iPad across the table with a five- to 10-slide PowerPoint deck you’ve created addressing: *The most common concerns about reverse mortgages *The top reasons someone might explore a reverse mortgage *Your firm *Your credentials *Your unique process
Let them flip through the PowerPoint; that way they’re in control. Watch and see what they pause on. Encourage them to express their feelings and/or ask questions. You want to have the heart of an educator, not a salesperson.
Beyond this meeting, you’ll want to use your CRM to make sure you’re touching them monthly. Vary the touches—some personal, some professional. Also, vary how you touch them—email, phone, face-to-face, etc.—until you learn their preferred modality.
Build your group of eight to 10 with people you’d actually like to have at your birthday party. Life is too short to spend a lot of time around people you don’t like and respect. One of Todd Duncan’s teachings is that “There are enough people that will do business your way to not worry about those who won’t.” My new filter is this: If you’re not someone I’d have as a Facebook friend, someone who gets to see pictures of my kids, you’re not someone I want as one of my eight to10 key partners.
Here are just three of the survey comments that illustrate the broad spectrum of the responses I received:
-“I’m so glad to see that you are analyzing this topic. I’m a CPA. I don’t know a whole lot about reverse mortgages, outside of the general tax implications, but my clients are getting older and it would be great to have them protected.”
-“If this was a test, I probably failed! Don’t know much about the subject.”
-“Not sure the point of this survey. Seems more like a survey to encourage advisors to use reverse mortgages. Reverse mortgages are a much-abused tool pushed by advisors looking to make a buck and sold to clients who don’t understand them. It doesn’t help that Fonzie and other celebs are whoring themselves out as spokespeople so seniors should use them.”
As a salesperson, resist the urge to convert that third respondent. Remember the 80:20 rule—you’re looking for people who like you and the product. Let the rest go.
Finally, one of the biggest pushbacks I hear from financial professionals is that reverse mortgages are not for everyone, as if that invalidates those for whom it is the ideal solution. Twenty-five million baby boomers will rely on Social Security for 90 percent of their income. The lucky ones have enough home equity that a reverse mortgage can allow them to age in place, mitigate some of their concerns and help them realize some of their aspirations.
Admittedly, many aren’t so fortunate. As originators, we get that and we have compassion for those we can’t help. I’m sure great doctors and nurses deal with similar emotions when they can’t help a patient. The story that helps me when I’m facing that goes like this:
One day, an old man was walking along a beach that was littered with thousands of starfish that had been washed ashore by the high tide. As he walked he came upon a young boy who was eagerly throwing the starfish back into the ocean, one by one. Puzzled, the man looked at the boy and asked what he was doing. Without looking up from his task, the boy simply replied, “I’m saving these starfish, sir.” The old man chuckled aloud, “Son, there are thousands of starfish and only one of you. What difference can you make?” The boy picked up a starfish, gently tossed it into the water and said, “I made a difference to that one!”
Ours is a noble cause. The number of people who need the solution we offer is enormous. The biggest obstacle is ignorance, but like the honeybee who gathers nectar, when we build a practice around a small number of strategic partners, and we take the time to educate them, we pollinate a much wider audience. In the process, we’ll help more people bridge the gap between longer life spans and insufficient retirement savings
