At the end of August, Guild Mortgage announced a suite of products under the name “Flex Payment Mortgage,” which includes Home Equity Conversion Mortgage (HECM) reverse mortgage products alongside refinances, proprietary jumbo options and HECM for Purchase (H4P) loans.
Jim Cory, managing director of Guild’s reverse division, previously spoke with HousingWire’s Reverse Mortgage Daily (RMD) about that rebranding initiative and what the division is keeping in mind following Guild’s acquisition of the robust reverse mortgage division of Cherry Creek Mortgage in early 2023.
In the second part of his interview with RMD, Cory assesses the confidence Guild has in the reverse mortgage product, as well as what his division is focused on as it ends the year.
Post-acquisition confidence
Earlier this year at The Gathering by HousingWire in Scottsdale, Arizona, Guild Mortgage CEO Terry Schmidt spoke a bit about the investments that Guild has made into its reverse mortgage division following the Cherry Creek acquisition.
“With Cherry Creek, [our interest] was reverse,” Schmidt said at the event in April. “Now, we have a good reverse mortgage division at Guild, and they do really great recruiting there, so we’re learning a lot.”
Schmidt went on to say that the size of the company’s overall mortgage portfolio means that a lot of customers already engaged with the company’s services are getting closer to the qualifying age for a HECM.
“There’s a big portion of those customers that are getting to that age where [a reverse mortgage] may be their next type of transaction,” she said. “The aging and demographics [provide] great opportunity. It’s a great product to have, so we see it as a growing niche.”
For Cory, the commitment that Guild has shown to the reverse mortgage division is evident.
“The company’s made a huge investment in reverse,” he said. “We service most of our own loans on the traditional side as well as the reverse side. ‘Customer for life’ is something Guild talks about a lot, even before this reverse division was added, and this is a perfect pairing [to earn the business] of a customer for life.”
The overall mentality of a “customer-for-life” strategy would be incomplete if later life was not part of the equation, Cory said.
“I always like to say that you can’t really present ‘customer-for-life’ if you don’t have a reverse mortgage offering,” he said. “So, our division fits in perfectly with that. And our marketing team is world-class and does all kinds of amazing stuff, and we’re just starting to tap into that with reverse mortgages.”
Looking ahead to 2025
Guild’s reverse division is headed into 2025 in a position of strength within the reverse mortgage industry.
According to HECM endorsement data for August tabulated by Reverse Market Insight (RMI), Guild/Cherry Creek has hopped from the No. 8 position in August 2023 to No. 7 one year later, and it has grown its market share from 1.3% one year ago to 2.5% today. Unlike most of the industry, the majority of its business is conducted in Colorado, according to RMI.
Current business and the long-term strategy through rebranding is tracking with the division’s plans, Cory explained.
“It’s all part of the plan,” he said. “It’s the plan we’ve been rolling out since most of this team came over from the Cherry Creek acquisition, which was almost a year and a half ago now. The goal has been to continue rolling out this product, making it easier and simplifying it. We really believe in simplifying the message.”
Like other companies that tend to lead with their forward mortgage offerings and then add reverse as an additional product, Guild doesn’t necessarily think that intense HECM specialization is the path to growing the business overall, as Schmidt indicated in April. Still, Cory is a longtime reverse mortgage industry veteran and sees the virtues in a broader approach to specialization.
“I’ll admit, after being in this business for about 27 years, I think we’ve made it difficult over the years by suggesting you need specialization to offer it,” he said. “And while I agree that on the operational side — whether it’s your loan origination system, other software, or different marketing — you absolutely need specialization.
“Different clients and their pace also play a role. But at the end of the day, we believe this is a relatively simple product when you compare it to other traditional mortgage options. There are more similarities than differences.”
Demystifying reverse mortgages
Despite the relative simplicity for the practitioners themselves, however, companies need to make a greater effort at “demystifying” reverse mortgages, Cory said, which is what Guild Mortgage is aiming to do with its rebranding initiative. But with that also must come a robust educational program to bring more people up to speed on the dynamics of the reverse mortgage product.
“We don’t recommend anyone try to roll it out to inexperienced originators without preparation,” he said. “That’s why we’ve put all these systems in place — training is the first priority but also the support through the origination system software, point of sale and more. There’s a lot that goes into it to help build confidence for our traditional loan officers.”
Some might benefit from a walkthrough process akin to an apprenticeship, while others may take to it more quickly.
“Some of my longtime colleagues have expressed concern — not specifically about Guild — but about forward originators trying to roll this out to the masses without the proper support,” Cory said. “We have all these different methods of delivering this, and I think that’s a really important point.”