Rate’s reverse mortgage lending leader in product specialization and growth

By adopting a consistent attitude inspired by the dynamics of the traditional term mortgage industry, Rate‘s reverse mortgage division has seen remarkable growth in the year since new leadership was appointed.

Ryan Ogata, Rate’s vice president of reverse mortgage lending, previously described how his experience in the term loan industry helped shape the way he approaches reverse mortgage lending. In this second part of his interview with HousingWireWriting in Reverse Mortgage Daily (RMD), Ogata details his plans to build on the division’s past success and how it is preparing for the possibility of lower interest rates this fall.

Forward in reverse direction

Ogata further described his approach to leading the division, saying it was inspired by the research he did before taking over last year.

“Before I even accepted the role, I did an analysis of the company,” says Ogata. “A big part of that was looking at the size of the existing sales team that is actively selling reverse mortgages. Our analysis found that there were fewer than 500 originators providing an average of at least 20 loans per year. That won’t be much of a problem in the future, but in the opposite sense it’s actually quite good, relatively speaking.”

But given the size of the addressable market and the expected growth of the senior population in the future, that’s not enough to fully serve the potential customers who could qualify for reverse mortgage financing, Ogata said. The baby boom generation alone represents as much as 20% of the country’s population.

“When you consider the size of that market opportunity and the fact that there’s an 80% homeownership rate among boomers, 500 people aren’t going to make a dent in what’s available,” he said. “A larger sales force is needed, and that will come from the forward-thinking teams – those at the front end of the business who are learning to fully embrace reverse mortgages as part of their overall product offering.”

Leveraging existing staff with experience, even if primarily from the forward lending side, will help Rate’s reverse division scale more effectively, Ogata explains.

“The mortgage industry has always been a numbers game,” he says. “The number of loans you will finance is based on the number of leads you bring in. With the approach we are taking, the only way we can capitalize on the market opportunity is to engage our existing sales team – which is already quite successful and large – focused on the reverse opportunity and incorporate it into their overall offering .”

The client, Ogata said, will not differentiate between a forward and reverse loan officer. Instead, they want a professional who can “prescribe the right product for what the customer wants to achieve,” he said.

Specialization versus diversification

Ogata does not view reverse-oriented work as “specialization,” he said. Instead, he sees it primarily as a matter of product diversification among the professionals who work for Rate.

“We are not deviating from progress, but we are adding to it,” he said. “I can maintain the forward business that I am used to, but that does not stop me from offering another product as an alternative. It’s about getting to know that product, understanding when to apply it and when not. It’s less about specialization and more about having a broader product offering and learning how to sell something different, while being deliberate about how to leverage that market opportunity.”

As an example, he brought up a scenario where the LO working with a client on a term mortgage could be the preferred option for the same person seeking a reverse mortgage. The way Rate’s inverse distribution tries to work makes that possible.

“Maybe that just happens to happen now that we can sell it,” he said. “But the numbers show that the team is deliberate in their actions and their intent to go out, find this company and sell it to consumers who may not have thought of it before.”

Support with ‘finite resources’

When asked about the business support Ogata is receiving from Rate, he expressed his satisfaction as it appears to him that the company views this industry as a priority for growth.

“The support has been great. In my position you always want more, but I have to be realistic with our finite resources.” he said. “But they have been very supportive. The marketing materials, the presentations, the continuing education, it was all a team effort. There is no way one person could do it all alone.”

That support was one of the things that helped Ogata see this as a career move worth taking, he explained.

“When I was considering this opportunity, that level of support was obviously a big factor,” he said. “The company already had the resources needed to do something like this. They have been very supportive, even though you always want more, you have to be realistic.”