Just when Home Equity Conversion Mortgage (HECM) endorsements were spiraling down a four-month volume decline, June bucked the trend with a near 24% increase in production, according to the most recent industry data from Reverse Market Insight (RMI).
Although overall volumes are still a bit low compared to the 5,296 loans recorded in the trailing 12 months as of June, the month’s 23.9% growth in HECM endorsements is at its highest level since August 2013—before initial utilization restrictions limited disbursement to 60% of the principal limit during the first year of the loan.
But as other changes, notably the Financial Assessment, have yet to fully impact reverse mortgage volume, June’s production is a sign that there is still some time before endorsements begin to feel adverse side effects.
“Judging by the application and funding volumes we’re seeing from lenders through our industry data repository, it looks like we might have two more solid months of endorsement volume before the significant declines from financial assessment implementation drag volumes down again,” writes RMI in its newsletter on the June data.
June’s production was driven by unanimous growth among all 10 regions of the country tracked by RMI, with the Southwest leading the way as it reported 243 loans, a 55.1% increase from the previous month.
In terms of the highest growth rate, the Rocky Mountain region saw HECM endorsements grow 85.9% to 329 loans in June, while the Great Plains followed with 151 loans, up 75.6%.
Among the top-10 lenders, the growth story was nearly identical with United Northern Mortgage Bankers Ltd., which ranked in the number 10 spot, posting the only decline during the month with 52 loans, down from 74 in May.
Home Point FInancial (formerly known as Maverick Funding) saw the biggest increase in HECM endorsements during the month, growing 55.2% to 149 loans.
Written by Jason Oliva