Getting LOs On Board with Loan Product Changes 

In our conversations with top lending executives for the various institutions we serve, we have found that one response to increased competition and lower loan volumes is an expansion of their loan product menus. This makes great sense and we’ve written about it in this space before.

While we agree that adding new products to the lender’s menu, allowing the institution to serve more borrowers and attract more business, is a smart move for leadership. But like every change management contemplates, without the support of the rank and file, success will be very difficult to achieve.

Change is hard. We all know this. Some of the changes lenders are considering now might seem like a large lift, but with good change management they get their loan officers on board and achieve success.

Why changing loan products is hard

When we watch a professional salesperson work, it can look a bit like magic. The way they guide the prospect through the conversation, building trust and exploring options before moving them into the right product and closing the deal. It’s a beautiful thing.

But it’s not magic. These professionals have finely honed pitches. They know the products they sell very well and have ready answers for every objection. They’ve earned their success through sustained effort over a long period of time.

Is it any wonder that they push back when management wants them to start selling something new?

Right now, many lenders are making the wise decision to add reverse mortgage loan products to their menus. As you might expect, many LOs are feeling concerned.

A new product or a new business

We’ve written in this space before about how reverse mortgages are simply a new class of products, but many in the industry still view them as an entirely separate business.

While reverse lenders were separated from traditional forward lenders in the early days, for reasons we’ve covered in past posts, today any lender can originate these products easily.

Part of the reason for this is that new technologies, like the Mortgage Cadence Platform (MCP) can now originate reverse mortgages as easily as forward mortgage loans. Origination, compliant reverse mortgage documents reverse-specific workflows, and other reverse functions have all been built in, allowing any lender to add these products without starting a new business.

Now, all the lender has to do is help their loan officers get on board.

Managing through a loan product change

This is another example of change management. The companies that handle this well will succeed when others fail. Here are three things they’ll do right in the process.

First, they’ll communicate openly and transparently. Loan officers, underwriters and processors are all going to feel like they are on uneven ground with a new product, especially one as different as reverse lending appears to be. Effectively communicating the facts about reverse mortgage lending and the benefits everyone in the company will enjoy by moving into it, to say nothing of the many borrowers looking for these products, is step one.

Second, they demonstrate to the team that management -- and the technology the company will use to originate these new products -- is flexible and adaptable. Being open to new ideas and approaches is easier when the LO knows that the process and technology can be adapted to her strengths. MCP offers all the flexibility the lender needs to make sure there is a good fit between new products and existing staff strengths.

Finally, everyone in the company should see this change coming as soon as possible. Too many companies plan in the back room and then spring it on the team with little or no warning. This approach is not ideal.. LOs need to see this coming and have time to prepare. By giving them educational resources that will help them get up to speed and some idea of the benefits these products will mean to their annual income, they’ll get on board.

Any change requires time, but lenders are making changes today in a market where every moment counts. Expanding the company’s ability to attract borrowers is a strategic imperative. Offering reverse mortgages makes sense. Following the advice in this article will make it easier for LOs to get behind that decision and succeed.

By George Morales, Reverse Mortgage Product Manager at Mortgage Cadence 

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Media Contacts 

Mortgage Cadence: 
Megan Martin 
EVP, Marketing 
(516) 480-6765