Reverse mortgage applications rose in February to 6,795 applications, a 17% increase over January applications and marking the first uptick in applications since August 2011 according to data released this week by the Department of Housing and Urban Development.
While the monthly data shows the highest level of applications in three months, year-over-year, February Home Equity Conversion Mortgage (HECM) applications were still down 16.6%, from a total of 8,149 applications in February 2011.
The cause for the uptick is difficult to pinpoint, given the absence of lender-specific or regional data, says John Lunde, president and co-founder of Reverse Market Insight. Two potential causes could be former Wells Fargo originators taking longer than expected to drive volume in their new firms, or a shift due to the pullback of MetLife’s financial assessment.
“Both of those would be interesting if we had numbers by firm, but they are both complete speculation in absence of numbers,” he says. “Regardless, very nice to see a bounce after a few very low months for case number issuance.”
Reverse mortgage endorsements remain down roughly 20% from last year, with the HECM Saver seeing continued growth at a near 30% year-over-year increase and more than 350 loans monthly. The HECM for Purchase fell slightly during the month, from 161 loans in January to 132 in February.
Written by Elizabeth Ecker