Mutual of Omaha: Direct Mail Drives Reverse Mortgage Leads

Reverse mortgage professionals are being urged to reconsider direct mail as a primary marketing tool. Kelly South, director of wholesale content and communications at Mutual of Omaha Mortgage, made the case during a company webinar, arguing that physical mail remains highly effective for engaging older homeowners.

South directly challenged the notion that direct mail is obsolete. "A lot of folks think that direct mail doesn't work anymore, and that's just not the case," she said. She described it as a method for starting conversations, particularly with cold leads who may be hearing about reverse mortgages for the first time.

Effectiveness and Targeting

South cited data showing direct mail's strong performance with the target demographic. According to marketing platform Lob, 78% of people aged 55 and older read their mail on the day it arrives. Data from PostGrid indicates direct mail generates $58 in revenue for every dollar spent, a return that outpaces paid search and email marketing.

Campaigns should target homeowners aged 55 and older, South advised. This is because many proprietary reverse mortgage programs have lower age minimums than the federally insured Home Equity Conversion Mortgage (HECM), which requires borrowers to be at least 62. She suggested running separate campaigns for seniors who own their homes outright and those with existing mortgages, as their financial perspectives may differ.

For format, postcards are a cost-effective option. The Association of National Advertisers reports an average response rate of 5.7% for postcards, compared to 4.3% for letter-sized envelopes with blank windows. South noted that using handwritten-style fonts and real or faux stamps can further improve open rates.

Campaign Strategy and Compliance

Success depends on a sustained campaign over eight to 12 weeks, not a single mailing. South recommended layering in phone and email follow-ups to complement the direct mail. She stressed that each campaign should have one singular call to action to avoid confusing potential borrowers.

Marketing can be divided into two categories. Invitation-to-apply (ITA) work focuses on brand awareness for broad products. Prescreen marketing uses more targeted messaging with property and credit data, typically yielding a higher return on investment but at a greater cost. South cautioned that prescreen campaigns must comply with the Fair Credit Reporting Act (FCRA) and clearly disclose all offer terms.

Tracking and Legal Safeguards

Measuring success involves tracking calls, appointments, applications, and funded loans to calculate metrics like cost per lead. South emphasized the need to answer 100% of consumer calls within 24 hours. She recommended vendors like Experian and Camber Marketing Group for campaign design and tracking, and CallScaler and CallRail for call management.

You can get that door to open all day long, but if you don't have the tracking in place or you don't have the ability to answer all the calls … it's going to hurt you, South explained.

On compliance, she provided a list of critical do's and don'ts. Advertising must avoid misleading statements, such as calling a reverse mortgage a guaranteed lifetime income product, or creating a false sense of urgency. All key loan terms and eligibility requirements must be clearly listed. Lenders must clearly identify reverse mortgages by name without implying government endorsement or suggesting a borrower cannot lose their home. Borrowers must still meet obligations like paying property taxes and maintaining insurance.

Mutual of Omaha offers co-branded marketing materials for its broker partners and operates a Broker Protect program. This program removes broker-driven leads from the company's own marketing efforts and alerts brokers to any payoff inquiries on those leads.