The most recent reverse mortgage endorsement numbers show the start of a long-predicted surge caused by the introduction of lower principal limit factors in October.
Home Equity Conversion Mortgage endorsements crept up 6.3% between October and November, with Federal Housing Administration-approved lenders turning in 4,782 loans. That’s according to the most recent report from industry analysts Reverse Market Insight, which credited the rush of applicants ahead of the deadline for the jump — but also offered a warning.
“We fully expect many of those last-minute applications will have a lower than usual pull-through rate in fundings and endorsements, but we should still see a couple more months of elevated volume before declining to significantly lower monthly totals in the wake of the 2017 PLF curve reductions,” the Dana Point, Calif.-based firm noted in its analysis.
Anecdotal reports of the pre-October 2 surge came in from all sectors of the reverse mortgage industry, from originators to housing counselors, but solid numbers have been hard to come by so far. RMI president and founder John Lunde has said that it could take until January for the full effects to be seen — and that the long-term volume drop under the new, lower PLFs could be as high as 25%, similar to what the industry endured after the introduction of Financial Assessment regulations back in 2015.
Industry leader American Advisors Group saw a 15.2% jump in November, with Synergy One Lending generating 22.8% more loans for a monthly record of 350. And a familiar industry name finally dropped out of the top-10 lenders list: Reverse Mortgage Solutions, which has existed as a servicing entity only since parent company Walter Investment Management Corporation (NYSE: WAC) shuttered its HECM origination channels in January, was supplanted by ReverseMortgages.com, Inc., in the number-10 spot.
Only Finance of America Reverse and Liberty Home Equity Solutions saw declines between October and November among the top 10 lenders.
Read the full report at Reverse Market Insight.
Written by Alex SpankoPrint Article