OneTrust Home Loans, a DBA of CalCon Mutual Mortgage LLC, announced recently the establishment of a new “55+ mortgage” division that will offer loan products specifically to older Americans. Among the products which will be offered, Home Equity Conversion Mortgage (HECM) loans will be a large part of the strategy according to the division’s new president, Jesse Q. Allen.
Coming off of a five-year tenure at leading reverse mortgage lender American Advisors Group (AAG), Allen was appointed to his new position at the end of May and will oversee the implementation of the new division into the OneTrust organization and its strategy going forward.
To get a better picture of how reverse mortgages will play into the launch of the division, RMD sat down with Allen to get the lay of the land regarding OneTrust’s 55+ focus and how it will impact the reverse mortgage space.
Reverse mortgages as a key product
Allen’s career in financial services extends back more than 30 years, having most recently served as EVP of alternative distribution at AAG, where he was responsible for launching and scaling the company’s distributed retail platform. Allen appeared in that capacity as a guest on the RMD Podcast, discussing his perspective on the reverse mortgage business. His career has also seen him in leadership positions for teams at large firms like Bank of America and Citibank.
When asked about how important reverse mortgages will be to the development of the new division at OneTrust, Allen described that the product will be front and center in the new enterprise.
“Absolutely, reverse mortgages are a big part of the equation,” Allen told RMD in an interview. “The strategy here is to be really focused on the customer first versus the product. So, when we think about this 55+ cohort of older Americans, what I like to call ‘active adult mortgage lending,’ we know what product needs to be part of the conversation. If we’re talking baby boomers and Generation X, then by definition, we believe that accessing your housing wealth through the reverse mortgage product is going to be a very big part of that business.”
Reverse mortgages could potentially be the dominant part of the business, Allen says, but the naming of the division was the source of broader conversations. Placing “reverse mortgage” in the name didn’t seem like the right move, he explained, because the focus is aimed to be more customer-centric than it is product-specific.
“We believe [the division] will grow largely through reverse mortgages — either HECM or proprietary products — but we also believe that some of those customers either may not be age-qualified or may just want to do a traditional mortgage,” he says. “So, we will offer traditional mortgage lending, like any other mortgage lender. And then long-term, we do have an opportunity to expand to other lending products, depending on the needs of the clients.”
The division’s product mix, specialization
In terms of the kinds of products that will be offered by the division in addition to HECM and proprietary reverse mortgages alongside traditional mortgages, Allen also describes non-QM balance sheet products as a part of the full product suite.
“Some of our senior clients may need bank statement or asset dissipation loans if they’re more mass affluent senior clients,” Allen explains. “Having a full suite of traditional mortgage products does allow us to serve that client segment a little bit more thoroughly. And non-QM would be a great example. We will have a robust suite of products in order to make sure that we can meet the client’s needs, depending on their circumstance and the path that they’d like to go down.”
When asked about how the specialization of personnel will break out and whether or not there will be dedicated forward and reverse personnel separately or hybridized loan officers, if an individual wants to take on both disciplines, they can.
“Within my division, we will have legacy reverse mortgage loan officers that are experts in providing reverse mortgages to clients, and we will also have traditional mortgage fellows who decide to join but focus their business primarily on the 55-and-up demographic,” he says. “They will serve Gen X and baby boomer customers and can learn reverse as an additional product to better serve that segment. So we’ll have specialists, and we’ll have loan officers who choose to do all products, depending on what might be appropriate for that particular client.”
Getting things off the ground
In terms of the work that needs to be done in order to get the division fully off the ground, Allen says that starting from scratch is the order of the day. Still, the existing infrastructure that was already in place made the idea of a 55+ division an appealing one, he explains.
“OneTrust is a very well-run traditional mortgage platform,” Allen says. “They operate very strongly through a customer-focused lens so they leverage technology very well, they have a full suite of forward mortgage products and their robustness as a traditional mortgage lender was appealing. They were very ‘reverse-aware,’ and were very interested in re-engaging in that portion of the business.”
The founding CEO had prior reverse experience, Allen says, so the idea of jumping back into the space considering the renewed strength of the business in recent months was an enticing opportunity for the company, he says.
“OneTrust is very committed to the older homeowner market,” Allen says. “So, we’re absolutely building a sort of a self-contained division, from sales through fulfillment and post-closing. We’ll certainly have to acclimate the culture and the capabilities to the senior client over time, but given the starting place for OneTrust and their intense customer focus to begin with, I think it’s a great foundation to build on.”
Allen is the first dedicated hire for the new division, but new hires are expected in short order. OneTrust is currently approved to operate in 48 states and other United States territories, Allen says, and it’s expected that the division will prioritize high-performing reverse mortgage states first including California, Florida, Texas and Arizona.
