Wholesale HECM Volume Declines, Impressive Growth in TPOs

The growth of third-party reverse mortgage originations from non-Federal Housing Administration approved brokers represented the continuing trend in April, amidst a month that saw wholesale endorsements fall 13.3% and retail endorsements decline 18%, according to a report from Reverse Market Insight.

“The balance between the two channels will be an indication going forward to see if TPO volume is growing the business as non-FHA approved brokers jump in or just migrating FHA brokers to TPO producers,” RMI wrote.

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The TPO trend made a lasting impression in April, accounting for 30% of all wholesale loans. RMI attributed increased competition to the drive toward more TPOs as many lenders “raced to catch up” during the month.

In the market for wholesale HECMs, MetLife grew slower in April than in March, according to RMI, and Urban, Genworth, Generation, Bank of America and Security One more than doubled their combined TPO business during the month, from 360 to 735 loans.

RMI also noted that the decline in wholesale business during the month came largely—88%—from two lenders: Wells Fargo and MetLife. Their market share comprised 44% in March, so their decline is far larger than their share of the market, RMI reports. However, the report says, smaller originators Urban and One Reverse both saw 12-month highs, with Security One posting another near-peak month.

View the RMI report.

Written by Elizabeth Ecker

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