In the ever-changing world of reverse mortgage lending success doesn’t just depend on riding the waves of high demand such as the HECM refinance boom; it requires the ability to withstand adverse market conditions. 

Reverse mortgage professionals who consistently excel often engage in their version of a stress test—not only for the numbers but for themselves and their business practices.   

What is a stress test? It’s an exercise that simulates or anticipates unfavorable scenarios to anticipate potential vulnerabilities. More importantly, it’s a means of preparing for the unexpected.  

One could begin by analyzing their financial stability under varying scenarios. Project cash flow assuming an adverse lending environment is one test.  Another is to scrutinize the source of your potential borrowers. Is the source vulnerable to a supply of leads, or a relationship with a professional? If you see too many of your loans coming from a handful of sources it’s time to diversify.  

Equally important is resilience in daily routines. Stress-testing yourself could mean tightening time management, reassessing how you handle customer interactions, or improving your communications by incorporating video emails for example. 

By deliberately working on these areas, you’ll be better prepared for high-pressure periods because you’ve already established a system.  Regularly “stress-testing” your business not only helps anticipate challenges but builds a mindset of resilience and agility—qualities that set the strongest reverse mortgage professionals apart.

Have you stress-tested your business? If so how? Share your inputs in the comment section below.