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Bad lead or something else?


Purchasing Reverse Mortgage LeadsIf you’ve ever purchased reverse mortgage leads or spoke to someone who has you’ve probably heard or even said the words yourself… “those leads were no good”. Some have taken this mindset to heart and have convinced themselves one should never purchase leads. The largest reverse mortgage lenders in the country consistently purchase leads and would not do so if it was a losing proposition. In reality, purchasing leads can and should be part of your overall marketing strategy along with referrals, public workshops, direct mail, etc. Now the question: was it a bad batch of leads or something else?

Bad Leads?

Definitions are important, especially when making business decisions, so let’s define a ‘bad’ lead. In fairness a bad lead should be one where the borrower does not qualify due to a high mortgage balance, low home value or fails to meet the minimum age of 62. A lead should not be considered faulty however, if the prospect qualifies but chooses not to take action. In other words, no loan, no commission.

Reputable lead providers provide varying degrees of guaranteeing a lead meets age and value guidelines which should make them eligible. Finding reputable companies is your first step. Ask for references from fellow colleagues or visit Reverse Fortune’s Lead Central which provides a central portal of top providers and the ability to inquire on price and availability.

Is it the process or the sale?

I once had a sales manager who told me “leads are only as good as the salesperson who works them”. While this may be a bit overstated, we must be willing to examine our own approach with prospective borrowers. Are we taking the time to know them, build an emotional connection between the product and their unique situation? More importantly, are you continually asking for the sale by getting small “yeses” or agreements to move forward incrementally? Sales is not a dirty word. The highest compensated individuals on the planet usually are involved in sales at some level. Sales is merely the skill of communicating in such a way to move a prospect to take action that is in their best interest. It is the art of communication and motivation.

How we conduct our business is really the compass which determines our success or failure. Many reverse originators purchase leads but trash them after one ‘no’. Others may have a haphazard approach to call backs, tracking conversations and strategic touch points. The result: thousands of dollars in lost commissions and fewer funded loans. Most potential borrowers require multiple contacts before they will make any commitment to move forward. If we stop at step three but they will move at step seven later, we have cheated ourselves from a sale and the prospect from a possible solution. The most effective sales forces utilize a database or CRM (customer relationship manager). This allows them to never discard a lead and to religiously follow up with each prospect over an extended period of time without fail. Another advantage to a CRM is the ability to track your past conversion ratios. For example: you purchased 30 leads and 8 took applications and 4 closed and funded. Your conversion ratios would be 26% for applications and 13% for funded loans. Knowing this you could project how many leads you would purchase to reach your intended sales target from purchased leads. Keep in mind the larger the data sample and time period the more accurate your results will be. If you intended to close five loans you would plan on purchasing at least 40 leads based on past conversion ratios. A CRM also allows you to track your ROI (return on investment) and cost per lead and funded loan. These metrics are key not only to control costs but in motivating you to be consistent in your marketing efforts.

Lastly, to succeed in lead purchase and loan conversion one must avoid the ‘one and done’ syndrome. One unsuccessful lead purchase and future investment in leads stops. Having a strong tracking system (CRM), knowing your conversion ratios and polishing our sales skills are the best tools we have in successfully working purchased leads. In the end we must ask ourselves ‘is it a bad lead or is it the process?’.


Editor in Chief:
As a prominent commentator and Editor in Chief at, Shannon Hicks has played a pivotal role in reshaping the conversation around reverse mortgages. His unique perspectives and deep understanding of the industry have not only educated countless readers but has also contributed to introducing practical strategies utilizing housing wealth with a reverse mortgage.
Shannon’s journey into the world of reverse mortgages began in 2002 as an originator and his prior work in the financial services industry. Shannon has been covering reverse mortgage news stories since 2008 when he launched the podcast HECMWorld Weekly. Later, in 2010 he began producing the weekly video series The Industry Leader Update and Friday’s Food for Thought.
Readers wishing to submit stories or interview requests can reach our team at:

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  1. Good morning. Pertaining to the lead generators listed on your site, are these companies being recommended by Reverse Fortunes or are they paid advertisers?

    • These companies are paid advertisers who were chosen based on industry reputation, quality of product and customer service record. Reverse Fortunes believes these lead providers are some of the best in our industry.

      That being said we have in the past or are currently using these lead providers ourselves. will not post a lead provider if we or our direct associates have had repeated issues with the quality of leads. While we do not guarantee the results of the leads the providers sell, please let us know If there is ever any issue with one of the vendors.

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