HECM endorsements increased 6.8% in February to 6,904, the highest monthly total in a year, and just 1.7% below the rate of endorsements from a year earlier, according to data compiled by Reverse Market Insight. During the month, the number of active lenders continued an upward climb, increasing by 9.9%.
The data also shows improvement for reverse mortgages in some of the hardest-hit housing markets, including Fresno (+22.4%), Sacramento (+8.5%) and Tucson (+14%). Several other severely depressed housing markets, such as Miami (-50.1%) and Phoenix (-14.3%), are still struggling in terms of HECM loans, but RMI considered the improvement in a few stronger areas to be a good sign.
“We’re almost sure to see endorsement growth next month based on application trends recently,” the report said. Applications fell 10.6% in January, but increased 27.4% from a year ago. January has historically been a down month for applications, but the industry still struggles to see volume meet that of previous levels.
“Several clients have mentioned that February application volumes are surprisingly strong, but there is no doubt that January’s numbers took a step in the wrong direction,” the report said. Weather is a reason being cited for the January decline, John Lunde, RMI president told RMD. Bounceback from tough weather in January as well as Bank of America’s exit from the business driving volume to other lenders could be cause for a strong February, he said.
See the full report.
Written by Elizabeth Ecker