Could Lender Scarcity Lead to Reverse Mortgage Opportunity in Some States?

There’s opportunity for reverse mortgage lenders in states with low penetration and relatively few lenders per household, and Reverse Market Insight’s most recent HECM Trends newsletter points out a few such markets from data compiled through July 2011.

North and South Dakota and North Carolina are the top three states in terms of low penetration paired with a lower number of lenders per household, and although Louisiana, Mississippi, and Iowa have higher numbers of available lenders, they also provide opportunity in terms of penetration rate potential.

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Source: RMI HECM Trends Newsletter, September 2011

When it comes to North Carolina, a state that has seen significant endorsement volume growth in the past three years, RMI president John Lunde says it’s one of only two top-10 states that has grown since 2007, with Texas as the other.

North Carolina has shown steady growth from 2008 through this year so far, sitting at #9 on the list of top 10 states for endorsement volume, with a 38.3% growth rate over last year. In fact, it’s the only top-10 state to have grown more in 2011 than in 2008, a peak year for many states.

Overall, the top 10 states have a 1.8% positive growth rate, with seven posting better numbers compared to last year. Only Florida, Maryland, and Illinois have lost ground, with all three falling more than 20%.

View RMI’s September HECM Trends newsletter here.

Written by Alyssa Gerace

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