The total number of reverse mortgages in 2012 will be down, MetLife or no MetLife, according to industry estimates. Just how much MetLife will leave its mark on the industry’s loan volume? Not a whole lot, says Reverse Market Insight’s John Lunde, president and co-founder.
Previously projecting annual endorsements of near 60,000, RMI has revised its estimate down following the departure of MetLife from the business to between 56,000 and 57,000.
“Accounting for all the information we have today, with MetLife not exiting, we end up in the 59- to 60-thousand range,” Lunde said in a report. “The worst case scenario of what’s already in the pipeline at MetLife getting endorsed and the industry not picking up any of the retail loans displaced, we end up at a 55,000 level for the year. Most likely we will end up in the 56-57 thousand range.”
In the coming months, the industry is likely to see May and June case numbers issued drop 11% to 15% as MetLife loan officers close out their pipelines without taking new applications, Lunde projects. “After that, the best case scenarios for industry volume would be to see an additional one to two months of transition as hiring, training, licensing and marketing start to ramp up for people going to new firms.”
The less optimistic timelines, he says, extend those estimates several months in the case of loan officers leaving the industry.
The fallout, however, doesn’t look that bad.
“Any way you slice it, we should all be expecting less than 60,000 endorsements for calendar year 2012,” Lunde says.
Written by Elizabeth Ecker