Reverse mortgage endorsements are down year over year, which is not news to those working in the business. However, the latest data released by the Department of Housing and Urban Development, after analysis from Reverse Market Insight, may show that the vast majority of MetLife volume has remained in the business through other lenders.
Endorsements, up 6.6% in August to 4,122 loans, still represent a sustained low after reaching the lowest level in years during the previous month. Bouncing back after the decline in nearly every geographic region, the count is still down on an annual basis, which many people may attribute to lender exits.
RMI points out, however, that more than three quarters of MetLife’s volume has remained following the company’s April exit from the business. The observation is based on case numbers issued in July, down just 3.5% year over year.
“This is a particularly interesting comparison since it presents the first picture of how much Metlife’s exit has affected the industry’s earliest leading indicator of volume,” RMI writes. “We never rely too heavily on one data point for conclusions, but that seems like a pretty good performance given that Metlife’s retail channel was 17.5% of industry endorsements Nov 2011-June 2012. This suggests 80% of Metlife’s retail volume is now being generated by other lenders, a much higher retention figure than Wells and BofA exits.”
Given the widespread branch networks of Wells Fargo and Bank of America, this might be expected. Additionally, much of the MetLife origination team landed with a single lender—Security One Lending—earlier this year.
Security One posted strong gains during the August, up more than 46% since the previous month.
Written by Elizabeth Ecker