Barrett Financial’s Christina Harmes on emotional intelligence for reverse mortgage brokers

Christina Harmes has the reverse mortgage bug in her blood. She previously worked with her father, Scott, at C2 Financial Corp., one of the nation’s largest mortgage brokerages, and has been originating loans since 2011.

Harmes, who’s based in Southern California, has since moved on to Barrett Financial Group, where she works as a reverse mortgage broker, coach and mentor. She recently sat down with HousingWire’s Reverse Mortgage Daily to discuss details about the coveted Certified Reverse Mortgage Professional (CRMP) designation, the importance of emotional intelligence in sales, and referral strategies to generate more HECM for Purchase business.

Editor’s note: This interview has been edited for length and clarity.

Neil Pierson: Let’s talk about Certified Reverse Mortgage Professionals — there’s only about 200 of them in the country and you’re one of them. What are the advantages of being a CRMP and how difficult is it to get the certification?

Christina Harmes: It’s hard. It takes 50 closed reverse mortgages, or having been in the industry for three years, plus a letter of recommendation. Then you have to pass a pretty difficult test. The last I knew, it had a 25% pass rate, so it’s pretty challenging.

I was sick the three days before I took the test, so I just stayed in bed studying the whole time. And I thought, “I’m going to be so mad at overstudying and wasting all this time.” And I just barely passed that test. I walked out of there going, “Whoa,” because it’s not what you’re going to learn by getting your mortgage license. You have to go out of your way to understand some counseling concepts, deep underwriting guidelines. I actually read two sets of lender underwriting guidelines, cover to cover, prior to that test.

I actually like that it’s difficult because it really is that higher level of expertise. When I see different designations and signature lines, I know they don’t come anywhere close to what the CRMP holds. We sign a code of ethics, which is really important, in my opinion. Some of us have fiduciary duties and some of us don’t as originators, but I think that fiduciary duty is a really important piece.

I had to learn that early in my career — you’re going to do what’s right for the client. You’re not just going to put them into a loan because it may be satisfying your sales quotas. You’re going to look at whether this a realistic and right solution. In my experience, CRMPs ask more questions and they ask different questions. In order to do reverse mortgages, I think there should be additional licensing besides the normal MLO licensing, but I don’t write the rules.

Pierson: Let’s talk about the recent Reverse Mastermind Summit. You were a speaker there and your points about having emotional intelligence with clients seemed to resonate. In your day-to-day dealings with clients, what is the importance of emotional intelligence, especially in light of the mistrust around the product?

Harmes: Emotional intelligence in this space is so important because we are dealing with a vulnerable population at a vulnerable time of their life. For a lot of people, finances and money feel like survival — and quite literally, it’s hard to say that it’s not.

If you can’t afford a roof over your head, then you could be homeless. If you can’t afford the groceries in the grocery store, then you’re not going to be eating. Those are survival pieces. I think it’s really important you have the emotional intelligence to be able to understand that and see that in your clients.

Dealing with a retired homemaker who did not deal with the finances, and now is a widow or widower, is a very different interaction than dealing with an engineer who is still working. And in our space, we’re going to have both types of clients. I’ve done loans for financial advisers themselves. Those are all very different type of experiences.

The reverse mortgage had some problems when it first started, and those problems created enough media sensation and enough noise that they got fixed. But people don’t always know that they got fixed. We’re dealing with people who are at least age 55 and they lived through the time where their nonborrowing spouse was not protected.

It’s really important to have that emotional intelligence, to bring it back around and say that these fears are real and they’ve been addressed. This product may have had some bumps along the way. It’s a very young mortgage compared to other mortgages, so we’ve had less time to work out those kinks.

Pierson: Barrett Financial is a broker shop, so let’s talk about broker agreements with lenders. When you’re setting up a loan and sending it to someone else for financing, how well do you feel protected? Refinance churning is still an issue and some clients may get solicited soon after closing. Has that ever been a worry for you?

Harmes: Coming from the forward space, it was a big worry on my mind. I was at one of the very first meetings for BRAWL (Brokers Rallying Against Whole-tail Lending), because in the forward space, every time rates drop, you’re trying to contact every client and say, “Hey, I can save you 50 bucks a month.”

In the reverse space, we’re interest rate sensitive, but we’re not interest rate driven. A lot of the time, when I look at a HECM-to-HECM refinance, their line of credit is already so big, I’m not going to refinance that loan. I put them in a good loan, I’m stoked they’re still in that loan, and it’s grown the way we wanted it to.

I don’t think lenders should be going after our clients. I think it’s really nice that there are broker protect programs in place with various lenders. But I also feel it’s important for you, as a business owner and a broker, to stay in front of your clients and maintain those relationships, so there’s no question.

Some of my clients come back to me saying, “Hey, I’ve been getting a lot of solicitation mail, I’ve been getting some phone calls, so I figured maybe I have a refinance opportunity. Can we talk?” That’s cool. I have that relationship, so other people are spending their marketing money and I’m getting the business.

Pierson: HUD reports that single women accounted for 41% of HECM endorsements in the past year. With that in mind, does there need to be a targeted effort to get more women to be originators?

Harmes: In the last six months, I’ve gotten four cold calls from clients, and each one of them said, “I just want to work with a woman.” I’ve had situations where it was a husband and wife. The wife didn’t feel cared for and spoken to properly by the originator who was male, so she went and looked up somebody else.

I’ve never had those kind of calls before. There’s something changing about the world where women want to work with women to feel comfortable in this space. I know there’s men in this industry who are emotionally intelligent and they’re not going to lose their business to a woman on that simple fact.

But I do think that when they say, “I’m looking for a woman,” what they’re really trying to explain is, “I’m looking for somebody who makes me feel safe, who explains things on my terms.” In their heads, that is a woman. As the world changes, bringing more women into this space is a really important thing, especially because of what you just said — 41% of our clients are single women.

Pierson: HECM for Purchase (H4P) is an interesting program that’s been underutilized. What are your thoughts on what it can do for seniors, and how do you build relationships with real estate agents to get the word out?

Harmes: Real estate agents are great to educate on H4P all day, but they actually end up sending you refinances. Most of my H4P business is not from Realtors — it’s from the clients directly.

I actually have a really cool transaction right now. The borrower came to me and she goes, “Christina, I want to do a HECM for Purchase. It’s a four-unit property, we’re going move into one of them, then we’re going have the rental income from the other three units.” And I lit up. I was like, “That’s one of my favorite strategies. Where did you find out about that?” And she goes, “From you on your YouTube channel.”

Honestly, with the H4P transaction, this this was not too different from my experience with Realtors on forward loans either. They don’t understand the finances all that well and they also have some big misconceptions about reverse mortgages. You have to educate them to a high level and hold their hand.

Other practices are structured different ways, but in my experience, we try to go directly to the consumer or to other professionals — the financial planners, the CPAs, other loan officers that might be talking money already. We’ll say, “Hey, if your client needs to downsize, if they need to sell and get some of that equity out, this is a piece of the puzzle that you should be looking at.” I’m not a Realtor partner — I’ll be open about that.