Reverse Mortgage Endorsements Trickling Downward, Still at Post-FA Highs

Home Equity Conversion Mortgage endorsements fell by 3.6% from April to May, according to the latest data from Reverse Market Insight.

The Dana Point, Calif.-based research firm counted 4,854 reverse mortgage endorsements among Federal Housing Administration-approved lenders last month, down from 5,036 in April and March’s recent record high of 5,364.

The slow but steady slide may quell rumors of a HECM resurgence for now, and the recent drops also confirmed what RMI founder and president John Lunde told RMD last month: While volumes had been higher recently, the gains could very well have been the result of a released backlog, particularly since Lunde said he hadn’t seen corresponding spikes in FHA case number assignments or demand for counseling sessions.

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RMI’s most recent post allows that the May report “paints a picture of gradual decline,” but also notes that the single-month numbers mark a significant improvement over figures in the immediate aftermath of Financial Assessment in 2015.

“For context, it’s also above any other month from September 2015 through February 2017, so still a step above where the industry has been since Financial Assessment was implemented,” RMI wrote.

Finance of America Reverse slipped from the number-two spot in May, ceding the silver medal to Reverse Mortgage Funding; American Advisors Group, predictably, led the pack with 1,028 loans. Live Well Financial also logged an impressive gain, turning in 172 loans for an increase of 29.3% — their strongest month since last September, according to RMI. Nationwide Equities also saw a 19.8% jump from the previous month.

RMI’s “HECM Lenders” report provides a breakdown of loan endorsements from FHA-approved lenders only; the all-encompassing “HECM Originators” list is due later this month.

Written by Alex Spanko