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Reverse mortgages 101

National Mortgage Professional
Jan 31, 2006

Mortgage technology and beyond: Every successful professional has a coachJohn D. SvirskyThe Mortgage Coach, mortgage software and programs Whether in sports, the arts or business, those who reach the top of their field have a coach - someone who can help them reach their peak levels, someone who can challenge them to raise the bar and accomplish more in less time, someone who helps them to find a way to distinguish themselves from the crowd. The Mortgage Coach received my five-star review about four years ago and they have improved the product since then. In my opinion, they have made it better and easier to use. It maintains its five stars. The major problem with The Mortgage Coach is if you stop using it, it doesn't work for you. People like Tim Braheem of LoanToolbox (another five-star program) will not take a loan application without using The Mortgage Coach; others include Steven Marshall, Jim McMahan and Barry Habib. Each of these professionals has written more than a billion dollars in loans. They use and recommend The Mortgage Coach. However, I have not written a billion dollars in business during my career, yet I also love Mortgage Coach and so do my clients who benefit from my using this program. A common trait of mortgage brokers who earn more than a million dollars a year in income (and in the past few years, there are many who do) is that they have all found a way to distinguish themselves from the myriad of competition out there by giving the customer more than other mortgage brokers. The really successful mortgage broker finds a way to give back. I am not talking kickbacks; I am talking about educating the client and giving them information to help them plan their financial life. As mortgage brokers, we see the client's entire financial life. It is painfully obvious that very few people have been disciplined enough to save for the future so they can either pay down their mortgage earlier or make investments to increase their net worth. Forgive this long-winded introduction; The Mortgage Coach is a truly great product. There are some who will say that Point or Encompass offer some of what The Mortgage Coach offers. Others will say they do it themselves on a Microsoft Excel spreadsheet. I say, terrific for them. But since more than 20,000 mortgage professionals have bought and used The Mortgage Coach, I am willing to bet that many if not a majority of the 20,000 users are in the million-dollar club or higher. Why? Because those who use The Mortgage Coach have gone beyond just taking the application; they have followed the route of being a trusted advisor, a mortgage planner and a mortgage manager. The truly successful mortgage planner/ manager looks at our business in terms of giving excellent advice and helping the client make the right mortgage decision for their needs. To do this, the professional broker gives them information they can use on a regular basis. In order for this service to be valuable, the mortgage professional must ask the right questions of the client; otherwise, you get "garbage-in, garbage-out." The Mortgage Coach asks the right questions and when answered by the client, provides detailed analysis and answers various "what if" scenarios to enable the client to make knowledgeable choices based on numbers rather than a flip of the coin. So what are the right questions? Besides name, address and birth dates, the following are good questions to ask: - What is your tax bracket? - When do you want to retire? - In how many years would you like to pay off your mortgage? - Is there an investment plan, or do you want to use the equity built up in your house as a savings tool? By knowing what the customer wants, you can provide them with the right product and, more importantly, the client is part of the process and looks at you as someone who showed them why they are doing what they are doing, rather than just being told, "This is the lowest interest rate, so take it." The biggest improvement to The Mortgage Coach is the dashboard. I like the program itself. It is simple and laid out well. From the dashboard you can navigate to any of the other five areas that you will be using on a regular basis. First, click on the client database. Here you enter the vital statistics: name, address, Social Security number, etc., and also liability information. Armed with the basics, this information auto-populates throughout the rest of The Mortgage Coach modules. The "Total Cost Analysis" is everyone's favorite; here you can show the client four different loan programs side by side and in color. Show the net cost of first and second if you are doing a piggy versus PMI, versus five-year interest-only, versus 30-year fixed. You can show anything the client wants to see; you can do four comparisons at a time and then you can show the comparisons after five years, seven years or any other period of time. Now here is where The Mortgage Coach shines: You can show the customer the effect of making extra payments to pay down the mortgage, or if they don't make extra payments but invest consistently, what percent of return (fill in the blank) per year they can expect, how much their investment account would be worth. You can then compare the after-tax benefit of pay down versus equity investment. What financial planner, accountant or tax adviser would not recommend you to their clients once they see the professional reports and information you provide, thanks to this software? This one module will break down most sales resistance and distinguish you from the hoards that just want to do the mortgage and run. Well, there is more to offer. The Mortgage Coach has a "rate watch" module. You fill in the high and low filters and how often you want to send out notices. I suggest you e-mail this to all your clients on a monthly or quarterly basis (make sure you get their authorization to e-mail or fax beforehand). The hidden benefits of this module are the referrals that come from your present client base. If a client's mortgage broker sends out a rate watch report just to keep them abreast of the mortgage market, it means that the client is valued for more than one closing and they will tell their friends, neighbors and family that they are dealing with someone who is an authority in the mortgage business. The "equity repositioning" module is a must when you are working with financial planners or advisers. It shows the borrower the advantage of consolidating debt and investing the savings. It clearly illustrates the benefits of restructuring their debt and saving the extra money instead of using the lower payment to buy a new SUV. The Mortgage Coach can show your client and financial planner how these small regular payments to savings from the refinance can produce big long-term savings and net worth in the future. Once again, you are showing that you are a mortgage professional who helps your clients help themselves. That is why I love this business; we not only get to make money, but we get to help people as well. There is a big market out there for those renters who have not yet made the decision to buy a home. For them, The Mortgage Coach offers the "rent versus own" module. There's nothing for me to say except that it works. It shows the fence-sitter which way will make more sense for them, taking into account principal, interest, taxes and insurance (otherwise known as PITI), tax bracket accumulated appreciation and prospective rent increases, and then shows the difference after whatever period of time you set. The last and very important module is the "debt consolidation" module. You can show your clients how much they will save by paying off those high-cost loans and credit cards. It is really easy to customize these reports the way you like it, showing a client how long it will take to become debt-free by making extra payments, the effect based on their tax bracket. Rather than giving the client a 15-year fixed-rate mortgage, ask them how much of an additional payment they can afford to make each month and you can show them how soon they will pay off the mortgage, and how much interest they will save by doing so. Instead of me going on with this review, I suggest visiting their Web site, www.mortgagecoach.com. There are excellent training videos that you can explore before you buy the product. Take it for a test drive, get the demo or just buy it; there is a 30-day money back guarantee. Go to a financial planner and try it out. See how quickly this product will pay for itself, not only financially, but in the increased respect and referrals you receive. Product Summary Product Name: The Mortgage Coach Version: 6.1 Web Site: www.mortgagecoach.com Recommendation: Buy it. This is a five-star product, I love it and I use it. The more I use it, the more it works for me. I highly recommend this product to be used before you even take the loan application. It will eliminate the rate-shoppers and encourage your clients to think of you as more than just a mortgage broker. You become a mortgage professional who not only helps them get a mortgage, but also helps them plan for their future. John D. Svirsky has been a mortgage broker for 24 years, doing both commercial and residential mortgages. He is also a volunteer firefighter, avid cigar enthusiast and cook. He may be reached by phone at (845) 424-3388 or e-mail john@svirsky.com.
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