Endorsements See Slight Rise in August, Awaiting Wells Fargo Fallout

HECM endorsements rose 5.4% in August to 5,807 loans, Reverse Market Insight reported this week. Still down year-over-year and awaiting what RMI predicts will be some fallout following Wells Fargo’s departure from the business in June, RMI points to the “bright side,” namely that volume was up in nine of the ten regions it tracks.

This, RMI reports, indicates a relatively broad-based rise. Regionally, the Mid-Atlantic saw a 13.4% increase and New England saw nearly as much growth at 13.3%. Year-to-date, the Rocky Mountain, Southwest and Great Plains regions are experiencing growth near 10%.

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Competition growth in August also saw an increase, of 7.6%, with 19 new active lenders.

View the RMI report.

Written by Elizabeth Ecker

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  • While the endorsement total for this fiscal year will be no doubt be the worst in six fiscal years and most likely less than 73,000, these numbers show a troubling trend unrelated to lenders dropping out of the industry.  The conversion rate from case number assignment to endorsement (“CNAtE”) may have dropped from 73% by 3.5% down to around 69.5%.
     
    It was amazing to watch the conversion rate from CNAtE stay at approximately the same 73% for the fiscal year ended September 30, 2009, when the total endorsements were at their peak at 114,785 as it was when endorsements collapsed 31% to 79,150 for the last fiscal year which ended September 30, 2010.  That was surprising and in fact, quite encouraging.  That meant that once a Case Number was assigned the applicant was just as likely to complete the loan in a great year as in a miserable one.
     
    But something has happened this fiscal year. On a twelve month rolling basis, the conversion rate from CNAtE reached its peak this year in January at 73.8%.  Last year the peak was reached in August at 74.6%.
     
    What may yet be more troubling is the decrease in the percentage of counselees even getting case numbers.  That fallout rate looks as if it has increased dramatically.  If the initial trends prove to be true, the fallout rate of those taking counseling may now exceed 50%.  The increased fallout rate for counselees getting case numbers was seen in early January 2011, preceding the announced departure of Bank of America.
     
    So what is going on?  With a historical satisfaction rate of over 90% why the sudden drop out rate?  Without further evidence, that is a matter of conjecture and opinion at least for now.  For now it is enough to say that at least surprising person points to one thing and one thing alone, as not so surprising does The_Cynic.

  • While the endorsement total for this fiscal year will be no doubt be the worst in six fiscal years and most likely less than 73,000, these numbers show a troubling trend unrelated to lenders dropping out of the industry.  The conversion rate from case number assignment to endorsement (“CNAtE”) may have dropped from 73% by 3.5% down to around 69.5%.
     
    It was amazing to watch the conversion rate from CNAtE stay at approximately the same 73% for the fiscal year ended September 30, 2009, when the total endorsements were at their peak at 114,785 as it was when endorsements collapsed 31% to 79,150 for the last fiscal year which ended September 30, 2010.  That was surprising and in fact, quite encouraging.  That meant that once a Case Number was assigned the applicant was just as likely to complete the loan in a great year as in a miserable one.
     
    But something has happened this fiscal year. On a twelve month rolling basis, the conversion rate from CNAtE reached its peak this year in January at 73.8%.  Last year the peak was reached in August at 74.6%.
     
    What may yet be more troubling is the decrease in the percentage of counselees even getting case numbers.  That fallout rate looks as if it has increased dramatically.  If the initial trends prove to be true, the fallout rate of those taking counseling may now exceed 50%.  The increased fallout rate for counselees getting case numbers was seen in early January 2011, preceding the announced departure of Bank of America.
     
    So what is going on?  With a historical satisfaction rate of over 90% why the sudden drop out rate?  Without further evidence, that is a matter of conjecture and opinion at least for now.  For now it is enough to say that at least surprising person points to one thing and one thing alone, as not so surprising does The_Cynic.

  • While the endorsement total for this fiscal year will be no doubt be the worst in six fiscal years and most likely less than 73,000, these numbers show a troubling trend unrelated to lenders dropping out of the industry.  The conversion rate from case number assignment to endorsement (“CNAtE”) may have dropped from 73% by 3.5% down to around 69.5%.
     
    It was amazing to watch the conversion rate from CNAtE stay at approximately the same 73% for the fiscal year ended September 30, 2009, when the total endorsements were at their peak at 114,785 as it was when endorsements collapsed 31% to 79,150 for the last fiscal year which ended September 30, 2010.  That was surprising and in fact, quite encouraging.  That meant that once a Case Number was assigned the applicant was just as likely to complete the loan in a great year as in a miserable one.
     
    But something has happened this fiscal year. On a twelve month rolling basis, the conversion rate from CNAtE reached its peak this year in January at 73.8%.  Last year the peak was reached in August at 74.6%.
     
    What may yet be more troubling is the decrease in the percentage of counselees even getting case numbers.  That fallout rate looks as if it has increased dramatically.  If the initial trends prove to be true, the fallout rate of those taking counseling may now exceed 50%.  The increased fallout rate for counselees getting case numbers was seen in early January 2011, preceding the announced departure of Bank of America.
     
    So what is going on?  With a historical satisfaction rate of over 90% why the sudden drop out rate?  Without further evidence, that is a matter of conjecture and opinion at least for now.  For now it is enough to say that at least surprising person points to one thing and one thing alone, as not so surprising does The_Cynic.

  • While the endorsement total for this fiscal year will be no doubt be the worst in six fiscal years and most likely less than 73,000, these numbers show a troubling trend unrelated to lenders dropping out of the industry.  The conversion rate from case number assignment to endorsement (“CNAtE”) may have dropped from 73% by 3.5% down to around 69.5%.
     
    It was amazing to watch the conversion rate from CNAtE stay at approximately the same 73% for the fiscal year ended September 30, 2009, when the total endorsements were at their peak at 114,785 as it was when endorsements collapsed 31% to 79,150 for the last fiscal year which ended September 30, 2010.  That was surprising and in fact, quite encouraging.  That meant that once a Case Number was assigned the applicant was just as likely to complete the loan in a great year as in a miserable one.
     
    But something has happened this fiscal year. On a twelve month rolling basis, the conversion rate from CNAtE reached its peak this year in January at 73.8%.  Last year the peak was reached in August at 74.6%.
     
    What may yet be more troubling is the decrease in the percentage of counselees even getting case numbers.  That fallout rate looks as if it has increased dramatically.  If the initial trends prove to be true, the fallout rate of those taking counseling may now exceed 50%.  The increased fallout rate for counselees getting case numbers was seen in early January 2011, preceding the announced departure of Bank of America.
     
    So what is going on?  With a historical satisfaction rate of over 90% why the sudden drop out rate?  Without further evidence, that is a matter of conjecture and opinion at least for now.  For now it is enough to say that at least surprising person points to one thing and one thing alone, as not so surprising does The_Cynic.

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