Demographic segmentation is probably the most evident benefit of reverse mortgage leads for a reverse mortgage lender.
Reverse mortgage leads providers always use age (62 years or older) as a filter to identify those who will make it to their lists. Only seniors 62 years and older are legally permitted to withdraw a portion of their property’s equity using the Home Equity Conversion Mortgage (HECM), popularly known as reverse mortgage. It is a program backed by the Federal Housing Administration (FHA).
But aside from that, reverse mortgage leads can also make for a good return on investment (ROI). On an average, a list of leads has a 2 percent conversion rate. That means, for a list of 200 leads, you can expect 4 prospective clients to avail the reverse mortgage loan. This is a particularly conservative valuation. Conversion rate may go up depending on a lot of factors.
Reverse mortgage leads providers differ in their lead generation practices. Some makes the exclusive leads clause a core value in their sales practices while others do not. Some places premium on business ethics and consistently practice patience and respect toward their target seniors as they build their lists. There are also few that capitalize on product misrepresentation, which eventually backfire.
To be able to make an impact to a lender’s growth, reverse mortgage leads should have the following characteristics:
1.) Exclusive Clause – The exclusive the leads, the higher the conversion rate. That means, when a lender is the sole user of a list of leads, the company can expect up to 25 percent conversion rate. So, in a batch of 200 leads, a lender can expect 50 new clients, up 12.5 times from a typical conversion rate of 2 percent. Additionally, a lead that is not exclusive means that a prospective senior borrower is barraged with quite a number of phone calls from other lenders, worse, salespeople making all sorts of offers. This will not just be a tremendous turn off. It will also bring a prospective senior borrower enough inconveniences. Reverse mortgage exists as a means to helping seniors and bombarding them with 100 phone calls a day does the opposite.
2.) Area-specific – Leads that are specific to a lender’s area make a face-to-face meeting possible. If a face-to-face meeting matters to a senior borrower, then a lender of the same locale as the senior can provide it without fail. If settling reverse mortgage processes via telephone makes a senior borrower uncomfortable, there is a greater chance of non-conversion. The senior, most probably, will walk away and look for a lender, which provides the said service.
3.) List of well-informed seniors – A list of seniors who understood the reverse mortgage processes including the advantages and disadvantages make for higher conversion rate. This means that seniors weighed in and found reverse mortgage beneficial to them rather than just being cajoled by any promotions. A well-informed senior borrower will stand up to reverse mortgage myth-driven criticisms from friends and family and pursue a reverse mortgage loan given factual information.
4.) Online leads – With a growing number of seniors qualified for a reverse mortgage using the Internet, online leads are expected to make the most ROI. Additionally, online leads are prescreened. Usually, senior borrowers made it to a list of leads because of their visit to a lead generation site where they expressed interest on reverse mortgage and requested for quotes from lenders. This means that they are indeed interested. With some lead generators having the commitment to educate seniors about the nature of reverse mortgage before offering anything, the probability of closing on a deal via online leads is exceptionally high.
While not all reverse mortgage leads are of the same footing when it comes to ROI, they are, at the least ROI-makers. Closing on a good number of reverse mortgage deals is vital to a lending business, and reverse mortgage leads play a crucial role on this department. A list of reverse mortgage leads, which are exclusive, lender-area specific, contains a list of reverse mortgage-educated seniors and are generated online can bring both ROI and client-base growth to a lending business.
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