Reverse Mortgage direct mail marketing makes sense for lead generation

March 23, 2012 at 1:43 PM

Today’s seniors have to get creative when it comes to funding their retirement. One such way those cash-strapped seniors are solving that equation is to take out a reverse mortgage, using their home’s equity.

Data released in January 2012 by the National Reverse Mortgage Lenders Association (NRMLA) shows senior home equity increased $46 billion in the third quarter of 2011. “The home is, by far, the largest financial asset most families have for use in retirement,” says Peter Bell, President and CEO of the NRMLA. “Reverse mortgages have evolved from a circumstance-based product to an accepted forward looking tool used for financial planning,” he added.

Although reverse mortgages are available to any senior 62 years old and older with significant home equity, the average age of a borrower used to be around 73, according to Sandy Timmerman, director of the MetLife Market Institute. “But with job losses, higher debt, and living costs, more and more of the ‘younger’ seniors are looking at reverse mortgages as a way to pay their bills and keep their homes,” added Timmerman. To obtain a reverse mortgage, the borrower needs to go through a counseling process to make sure they are aware how a reverse mortgage operates. According to the MetLife study, “Among those who received HUD-approved counseling for reverse mortgages in 2010, 67% indicated they wanted to lower household debt, while only 27% were doing so to enhance their lifestyles.”

With an increasing number of seniors every day turning 62, and the financial security that they are looking for, reverse mortgage is a loan product that needs to be marketed. The reputation of the reverse mortgage industry is also improving and with actors such as Henry Winkler, Fred Thompson, and Robert Wagner touting the benefits, it is growing in popularity.

Where does this leave a marketer for lending institutions offering reverse mortgages? Looking for direct marketing solutions to reach those interested in the reverse mortgage product. Here is what we know based on our experience in generational marketing as a specialty subject of interest.

  • Audience: They were born between 1925 and 1950. They make up 21.5% of the population. They define themselves by their work and what they have accomplished. They are time starved and low on patience. They are the original “yuppies” (Young Upwardly Mobile Professionals).

  • Timing: They are the least patient of the generations and want information immediately. Your marketing needs to be quick and to the point. They are time starved and will make decisions quickly. The mortgage company that gets them what they want in the quickest time will earn their business. They are also less likely to respond to quick and time sensitive offers, but they understand the value of a good deal when they see one.

  • Offer: Convenience is the key to marketing to this generation. Saving them time on loan application, saving them on closing costs, or saving them from comparative shopping will earn the trust and respect of this generation client.

  • Response: They are underestimated in the technological experience as they are the largest on-line consumer base. Their call to action can be either phone or email because they want quick responses to their questions.

As the population ages, there will be more and more opportunity to market to these individuals who are looking to pay bills, and fund a life that is now filled with higher costs, more medical bills, and less wages. Direct mail marketing can be the direct marketing workhorse tool that can reach this prospect as they are looking for ways to make their life more comfortable.