Reverse Mortgage Wholesale Volume Up 9.3%, Broker Market Share Increases

Reverse mortgage wholesale volume rose 9.3% in January according to a report released this week from data provider Reverse Market Insight (RMI).

Wholesale endorsements totaled 2,413 units in January, a near 10% increase over the previous month, but still down 45.8% from January 2010.  Retail endorsements lost 6.8% month-over-month, totaling 4,049, but gained 27.7% from last year, according to RMI.

Broker volume accounted for 37.3% of total volume during the month, up from 33.7% but a 58.4% decline from a year ago.

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Source: Reverse Market Insight

“The divergence between channels is particularly striking this month because retail was entirely responsible for the industry decline,” RMI said. “It’s way too early to attribute the weakness to Bank of America’s exit (we won’t see that effect until at least March or more likely April endorsements), so we can probably expect some bounce-back from Retail in February results if our client conversations are any indication.”

Despite its decision to leave the business, Bank of America had its best two months since February 2010 according to the report.  While the bank’s retail channel recovered with the rest of the industry, wholesale business grew very little.  “We’ve heard from several people in the industry that this directly related to the decision not to pursue certain types of broker/wholesale business,” said RMI.

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With regard to specific Top-10 lenders, Genworth Financial and Urban Financial saw the greatest gains and Financial Freedom had the largest decline, landing at a multi-year low.

For a copy of the report, see here.

Written by Elizabeth Ecker

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  • Until at least July the wholesale information seems to be of less value than at any time in the history of the industry. With B of A leaving the marketplace, the pending change to compensation currently on track for implementation on April 1 (fool’s day), the market is in far too much turmoil to gain much insight from these numbers now and probably for some time to come.

    • Lots of mud in the wholesale waters for sure. Seeing the broker/wholesale response in aggregate will give us a very good sense of the net effect of all these changes, although to your point it will be very hard to pick out one cause for volume/competitive changes.

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