Reverse mortgage applications fell 8% in April, to 6,508. On a year-over-year basis, the decline represents an 11.7% fall from May, 2011, according to the Federal Housing Administration’s FHA Housing Outlook. The data marks another low month for applications, which have been down year over year.
Products other than the Home Equity Conversion Mortgage Standard did see some uptick month-over month, with the HECM Saver showing 348 applications, up slightly from 332 Saver applications in April. The HECM for Purchase also saw an increase, from 110 loan applications in April to 153 in May.
While the Saver increase is not meaningful, the Purchase data could be a hint of good things to come, says John Lunde, president and co-founder of Reverse Market Insight.
“It’s nice to see the bump in purchase because these would be for February/March closings, so earlier than the typical spring/summer selling season,” he says.
Additionally, applications for May will be an indicator of future volume post-MetLife’s exit from the reverse mortgage business, Lunde says, although this month’s data will not yet show that impact.
View the April FHA Housing Outlook report.
Written by Elizabeth Ecker