Top Reverse Mortgage Lenders of 2009

Overall reverse mortgage volume climbed 7% in December with 8,284 units, bringing 2009 volume to 111,924 endorsements according to data from Reverse Market Insight.

Endorsements in 2009 fell 2.8% from 2008, driven mostly by a significantly weaker 4Q.  Take a look at the commentary and report which goes into more detail below.   




  • The fourth quarter was significantly weaker than the rest of the year, with volume for the quarter 18% lower than Q1, 14% below Q2, and 12% lower than Q3.
  • Active lenders increased 6% from 2008 levels to 3,123 for the year. 
  • Wells Fargo ended the year in the top spot for retail endorsements, followed by Bank of America, Financial Freedom, and Metlife.
  • Of the 6 lenders in the top 10 that grew y/y, One Reverse had the strongest growth at 258%, with Metlife 2nd at 143% y/y growth.

December MIC Summary Report

Market statistics and report sample provided by Reverse Market Insight, the leading source of market intelligence in the reverse mortgage industry. For more information about RMI and to purchase the full MIC report with additional key performance indicators and market statistics, please visit our website at

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  • Endorsements down??? We all knew originations in the last quarter would be way down, but endorsements?

    Very few, if any, of these endorsements were originated in December 2009. The same would be true for November 2009. It is doubtful if the majority of October 2009 originations would have been endorsed by the end of 2009. This means that originations for the fiscal year 10/1/2008 through 9/30/2009 were down. That is truly astounding.

    What this means is compared to the same period last year that overall origination production is significantly down. The endorsement numbers reflect HECMs only. Last year we had proprietary products including HomeKeepers. This means total originations on all reverse mortgages are much lower than what these numbers reflect.

    Let’s look back on the last fiscal year of HECM originations. Despite some setbacks, origination volume should have been up. Last year industry leaders were proclaiming that despite lower origination fees with the benefits of HERA (PL 110-289), sales would be up sufficiently that no one should see a drop in origination fee income. We saw better news especially about the HECM lending limit than anyone expected in November 2008. So let’s take a look at a few of the things that impacted HECMs origination production between 10/1/2008 and 9/30/2009.

    • For the first time in a couple of years, those in the high home value communities saw the HECM lending limit rise from $362,790 to $417,000 at the beginning of the fiscal year.
    • Then a few months later it rose 50% higher to $625,500. There were calls within HUD that these increases in the lending limit would overwhelm HUD with new volume.
    • We added HECMs for purchase.
    • We suddenly saw a monkey wrench in adjustable rate originations when Fannie Mae raised margins.
    • At the end of fiscal year there was a push to bring more HECMs into the prior fiscal because of the reduction in Principal Limits on 10/1/2009.
    • Some reduction may have occurred because of marginally weak steps taken against cross selling but that was a slight drop at best.
    • Borrowers fell in love with fixed rate HECMs.
    • Maximum HECM origination fees were capped at $6,000 and the structure lowered the overall maximum except on homes valued at less than $200,000.

    So what caused the downturn? It seems most of it occurred between July 1, 2009 and September 30, 2009; that is the period in which the majority of HECMs endorsed in the last calendar of this calendar year were originated. Knowing what caused this drop seems vital to our future.

    Pinning down the cause is important. What do you believe caused it?

  • Did you ever look at this from an originator's point of view? Declining values and lower principal limits killed many deals. Also, what about waiting 30 DAYS for a file to be reviewed by an underwriter? And then to have needless conditions added as a delay to close the loan because the lender had no place to sell it? What about the lenders that closed or re-organized? What about the lenders that only offered the higher fixed rate for a while? What about being accused of “bait and switch” because margin changes happened rapidly while underwriting slowed to a halt. You need to be dealing with several lenders because you never know when the rules will change. And each lender interperts the guidelines differently and most use different documentation. You need to learn several different originating systems and the various guidelines of each lender before deciding which lender is best for your customer. And what about counseling? Many counselors lost their approval because HUD retested. Waiting for couseling also slows down the process.
    Have you looked at the new good faith requirements? It is next to impossible to introduce a customer to the product since you can no longer show all the fees because you can not get a good faith without a full application. The estimate of closing costs that is now substitued in does not include title insurance so costs are not accurate.
    Did I mention all the positive press that has been offered? Reverse Mortgages are lumped in with the subprime no matter how much we know that is just plain wrong. Mortgage originators, brokers and bankers are now on the same level with garbage collectors and are blamed for everything that is wrong in the world. (Garbage collectors are probably making more money at this point – no offense to these hard working people)

    And we wonder why there is a decline in business?

    • discustedoriginator,

      I am an originator. I try not to be so myopic and try to maintain a life outside of originating.

      A few years ago, processing plus underwriting took in excess of 90 days at the largest wholesaler in the country even if you had a clean file; yet production was going up. Your complaints about lenders, etc. are nothing more than supply side issues.

      What do GFE issues have to do with any production issues before 1/1/2010? Counseling has always had peaks and valleys. Again even if legitimate, these are supply side issues.

      When speaking of demand issues, the first legitimate complaint is bad press. But is that really all that new? We have had it before. As to reputation, garage collectors are much higher on the totem pole than used car salesmen and as some say, attorneys.

      In 2008 when she could think of no worse name to call McCain for some tactics she accused his campaign of employing in reaching out to seniors, the chairwoman of the Florida state Democratic Party called McCain, a “bogus reverse mortgage peddler;” now that was a low point, having someone from the Democratic party using reverse mortgage originators as her model of scum. I guess you were not around in mid 2008. We even heard about it out here in California.

      You need a psychologist to be discusted (I think you meant disgusted) with. All of your demand side complaints are nothing more than OLD NEWS. They certainly provide no insight into why endorsement volume was so low in the last quarter of 2009. I wish you the best in overcoming the attitude.

  • I think the extremely negative article in the Sept. issue of Consumer Reports was very damaging. Many seniors read it and live by its recommendations.

    • Linda92714,

      You are right; however, what does that have to do with the volume of originations before it was published? It is my belief that we will start to see the negative impact of that article in 1st quarter of calendar 2010 endorsements.

  • Unfortunately, press generally likes a negative story. I don't know – does it really sell papers? Seems most positive press comes from within the industry. We know reverse mortgages help many seniors. Seems the bulf of people I talk with a reverse was the one thing that help them STAY in their home.
    Anyways, from what I see appraisals have been the hindrance in probaly 40% of applicants.

  • Unfortunately, press generally likes a negative story. I don’t know – does it really sell papers? Seems most positive press comes from within the industry. We know reverse mortgages help many seniors. Seems the bulf of people I talk with a reverse was the one thing that help them STAY in their home.rnAnyways, from what I see appraisals have been the hindrance in probaly 40% of applicants.

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