Reverse Mortgage Securities Volume Slides, But AAG Hits High Mark

Issuers of Home Equity Conversion Mortgage-backed securities (HMBS) saw lower production of new pools in January, but the market is still at a higher point than it was the same time last year.

HMBS issuers generated $657 million in new production last month, according to the most recent numbers from Baseline Reverse. That’s a drop from the $747 million in December, the St. Johns, Fla.-based analysis firm noted.

The leaderboard remained unchanged from December, with American Advisors Group topping the chart at $172.4 million in new issuance for 26.3% market share. The Orange, Calif.-based AAG’s performance represents the highest single-month total for one issuer since 2013, according to Baseline.

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Finance of America Reverse came in closely behind with $153.1 million and a 23.3% market share, followed by Reverse Mortgage Funding, Ocwen, and Live Well Financial. Longbridge Financial, which just entered the HMBS production space last year, fell just outside the top five in sixth place with $47.2 million and a 7.2% market share.

January’s $657 million in new issuance still represents an improvement over the total logged in January 2017, when issuers turned in $532 million. Still, the first month of 2018 alas saw the first significant decline in original production from recent peaks in November and December, driven in part by surging endorsements caused by principal limit reductions last fall. 

Check out a full interactive set of HMBS data at Baseline Reverse.

Written by Alex Spanko