Wholesale reverse mortgage endorsements fell 13.3% during December, while retail originations gained 8.5% according to data from Reverse Market Insight (RMI).
Broker business fell to 2,207 units during the month while retail endorsements came in at 4,343 units. Overall, combined totals show a flat line from November to December 2010, falling by a single endorsement from 6,651 in November to 6,650 in December.
RMI suggests the decrease in broker business stems from increased regulatory pressure and higher costs for brokers. If that’s the case, RMI says, the industry is likely to see consolidation as brokers join up with bankers in the coming months.
“Because of the revenue disadvantage created by the regulation, brokers are finding ways to become a lender closing their own loans, which usually means consolidation with either an existing bank or multiple brokers coming together to form one new lender,” says John Lunde, RMI president.
In terms of specific wholesaler positioning, according to Department of Housing and Urban Development (HUD) data, MetLife maintained its number one wholesale lender spot with 707 HECM units. Bank of American followed in the second position with 452 reverse mortgages in December, just months before announcing its exit from the business in February. Generation Mortgage was third with 240 HECM units and Urban Financial a close fourth with 237 units. Wells Fargo rounded out the top 5 with 152 HECM units.
View a full copy of the RMI report here.
Written by Elizabeth Ecker