Education and problem solving are the keys to turning around purchasing activity
Take the word out
For Lisa Di Pasquale, who collaborates with Silvercreek Real Estate Group in Idaho, she was first introduced to HECM for Purchase by attending a class taught by Curtis Mangus, branch manager at Premier Mortgage Resources. Di Pasquale explained that the class was informative and highlighted a potential opportunity for people who may be moving to Idaho.
“This was a huge opportunity for people who moved here from places like California and were able to use their equity to buy a home,” she said in an interview with RMD.
She was particularly attracted to seniors moving to Idaho from California – a move she also made and says makes up an overwhelming majority of her business. When an opportunity arises, she offers these customers educational materials from Mangus. This informs them about the HECM for Purchase product option to see if it is suitable.
“It has been a very good tool for my company to be able to sell more houses,” said Di Pasquale. “And I have clients who are even happier than they would have been had they not known about this particular loan program.”
When it comes to educating more brokers about H4P, many are receptive, but the potential solution needs to be mapped out, said Ronnie Hale, managing broker at Century21 North Homes Real Estate in Oregon.
“The biggest problem I encounter is a lack of actual understanding of the process, [in terms of] what this can do and what it means for a real estate agent or broker,” Hale said. “Understanding what you get out of it and how you can better serve your customer when you understand the process is a big piece of the puzzle.”
Framing it around the potential to solve a problem, especially for clients who are no longer working full-time and need a way to finance the purchase of a home, helps to contextualize how the program would work on an individual basis can work, says Hale. explained.
“When you work with people on a… [HECM] for purchase, [you need to ask] what do you want to achieve and how – in a time frame when you are not receiving any income, how do you ensure that you succeed?” he said. “And so I’m busy solving problems. I like doing puzzles.”
Details are crucial
When Di Pasquale was asked to estimate her success rate with customers after introducing them to the HECM for Purchase concept, she said it hovered between 50% and 70%. Part of that, she said, stems from California’s higher home values. When a client sells their home in that state and chooses to move to a cheaper state like Idaho, there is more equity to put into a HECM for purchase transaction.
“I’ve sold a lot of great homes to people who otherwise couldn’t afford them,” she said. “Plus, they still have some extra money left over.”
But not all collaborators are created equal, and she said she hopes to continue working with Mangus after a less-than-optimal experience with another professional on another transaction.
This also comes back to the inherent need for all parties to the transaction – customers, agents and originators – to fully understand the tool that will be deployed, Hale added.
“You have to learn the game and learn what seniors need,” he said. “You have to be able to teach; you need a good team and a good mortgage advisor who knows how to put the deal together. You have to understand how to structure a deal so that it works for them.”
Hale said these are the basics that need to be understood, but sometimes agents lack the educational mindset to move forward with such a deal. Hale said this piece should not be overlooked.
“Sometimes real estate agents feel like we just have to sell a house,” he says. “They say, ‘Give me a house to sell,’ but you have to educate yourself.”
