Reverse Mortgage Endorsements Stalled in June

Reverse mortgage endorsements continued their mid-year slowdown in June, with the regional data painting a particularly disheartening picture.

Federal Housing Administration-approved lenders saw an endorsement dip of 0.4% in June, turning in 4,837 Home Equity Conversion Mortgages according to the latest report from Reverse Market Insight, Inc. Those numbers remain unsurprising given the trends over the past few months, as growth slowed following a torrid winter, but the Dana Point, Calif.-based research firm expressed some concern about the region-by-region numbers.

“That’s neutral at best on the face of it, but it’s surprising that just one of the nine regions grew in June,” RMI noted in its analysis.


The lucky winner was the Pacific/Hawaii region, which saw a gain of 113 loans from May to June. All eight other regions had downward-pointing red arrows, including just 77 loans for the Great Plains — down from 95 in May, or a drop of 18.9%.

The top 10 lenders, meanwhile, saw endorsements grow just a little bit, with 1.5% higher volume according to RMI. The leaderboard itself remained relatively steady, with American Advisors Group leading the pack by more than doubling the total for second-place Finance of America Reverse; however, RMI pointed out that FAR saw impressive month-to-month growth by increasing endorsements 52.9%.

There had long been signs that high endorsement growth levels earlier in the year were poised to decline, including a lack of corresponding increases in counseling demand or case assignment numbers. But total monthly endorsement volume remains higher than at the same point in 2016, according to RMI’s year-to-year tracking chart.

Check out RMI’s full set of data here.

Written by Alex Spanko

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  • The simple fact is that since 2012, the industry stopped its three year tailspin of fiscal year endorsement losses and started a period of five consecutive fiscal years of stagnation (including fiscal 2017). So far the pattern is one of peaks and valleys but all within the range of 48,900 to 60,200 endorsements while overall turning slightly downward.

    This is NOT a month by month story but the story of almost a decade. Even the first year of this decade (which decade ends on September 30, 2017), we began two years of relative stagnation all on a slightly upward direction. Our only sense of direction in this decade has been stagnation whether it was above 100,000 or in 50,000 to 60,000 endorsements below 110,000. Otherwise for three years the only direction annual endorsements have gone in is one of losses.

    So much of the time, it seems rather than discussing actual patterns, the leading analysts in the industry are satisfied with looking at the last few months and from there divining the future. No one blames them for this course of action since it appears to be an industry habit. Normally these same analysts are simply following the desires of their customers, the lenders.

  • Based on the first nine months of endorsement activity so far this fiscal year, there have now been 41,553 HECMs endorsements. Since fiscal 2017 is a up leg in the current stagnant pattern, it is expected that the total number of endorsements during this fiscal year should total over 50,000 endorsements but beneath 56,000. This reflects an unexpectedly weaker surge than in the prior two fiscal year up legs of 2013 and 2015.

    Since as of midnight (Pacific time) today, July 10, 2017, HUD has not provided case number assignment data for any month after March 2017, there is no way to determine based on verifiable and reliable data how endorsement activity in fiscal 2018 will fare. Fiscal 2018 could be the fiscal year the industry surges its way out of stagnation but again there is nothing to say fiscal 2018 will not be the sixth year in a row of continued secular stagnation or worse a year of substantial endorsement loss.

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