Reverse Mortgage Originations Slide 17.3%, Wholesale Takes 28.7% Hit

Originators of Home Equity Conversion Mortgages saw endorsement figures drop 17.3% in March, according to the most recent figures from Reverse Market Insight — dragged down by a “stunning” 28.7% decline in wholesale originations.

The industry, including both Federal Housing Administration-approved and non-approved lenders, logged 4,298 loans in March, representing the second consecutive month of sharp drops; February’s 5,195 was a 17.6% dip from January, when the full force of the pre-October 2 surge was finally proven in the numbers.

The numbers were even bleaker on the wholesale side, with just 1,815 loans last month — a drop of 28.7%. After a January glut that saw 3,121 reverse mortgages generated through the wholesale channel, the bottom appears to have fallen out, with an 18.4% decline in February.


But the spread between the two primary channels in February was much narrower, as retail lenders saw a 16.9% drop that month; in March, retail volume only slowed by 6.3%. RMI founder and president John Lunde said that split is typical of major shifts in the reverse mortgage industry in either direction.

“Usually brokers are more nimble, given they have less investment in the space than a full retail operation,” Lunde told RMD. “It’s the same pattern we’ve seen in both up and down cycles historically.”

The Dana Point, Calif.-based RMI found some bright spots in the otherwise bleak numbers, pointing out that Nationwide Equities rebounded from an “outsized” decline in February to claim a 37% boost in March, while Live Well registered a 36% gain. Finally, One Reverse Mortgage logged a 3.2% uptick “to continue one of the steadier performances in the industry,” RMI observed.

The top five lenders in the industry over the last 12 months remain American Advisors Group, Finance of America Reverse, Reverse Mortgage Funding, Liberty Home Equity Solutions, and Synergy One Lending — the latter of which was recently sold to Mutual of Omaha Bank.

Check out the full statistics at RMI.

Written by Alex Spanko

Join the Conversation (6)

see all

This is a professional community. Please use discretion when posting a comment.

  • Few want to discuss demand. Demand is most relevantly seen in the numbers reported by HUD as CNAs (Case Number Assignments). In the first six months of this fiscal year, total CNAs are not even 25% of what they were for fiscal 2017. One would expect that the total would be at least above 40% by now.

    Right now H4Ps are running about 27% of what they were last fiscal year. So even the so called “Sleeping Giant” of this industry is resting on its laurels this fiscal year when it comes to production.

    Not surprisingly HECM refis are about 7% of what they were last fiscal year. Yet so far they are 30% more than H4Ps this fiscal year. To many H4P proponents that may come as a surprise.

    What all of this is leading up to is that fiscal 2019 may see fewer endorsements than fiscal 2018. That would be a significant change for the current pattern of secular stagnation but would still not be a welcome event since fiscal 2019 should be an up year for endorsements in our current peak to valley pattern.

    • Raymond,

      If you think that is intense, wait for the April 2018 stats. We already know that total endorsements for April 2018 is 22.2% LOWER than March 2018 at just 3,345.

      All this bodes from the fact that on an annual basis we are in downward sloping, peak to valley, secular stagnation and have been in it for at least five fiscal years now. The great pull forward effect of Mortgagee Letter 2017-12, has been slow to be endorsed.

      Without far more case number assignments each month, we could slip into a fiscal year of significant total endorsement loss in fiscal 2019.

  • I Have to agree with Jim Veale on his predictions for Aprils figures, it does not take a Rocket Scientist to see what we are going to face! Don’t take what I said the wrong way, Jim Veale is a Rocket Scientist as far as I am concerned!!

    However, there are bright spots for the future. There is a good possibility since the confirmation of Brian Montgomery, we will see some needed changes or partial roll backs. primarily in the PLF tables! Also, the entrance of Mutual Of Omaha Bank is a positive, I feel they will bring some more innovative programs to the table as well as creating career opportunities.

    Another thing to keep in mind, let us not forget what RMF and some others are doing with their proprietary programs coming into the market.

    Agreed, some of these items are not going to help endorsements but will help the survival of the reverse mortgage and those in our industry that can hang in there!

    Last but not least, we all have to approach the market differently, go after the professional sector aggressively and work harder than ever! No reason for us not to survive and make it!!

    John A. Smaldone

    • John,

      As to newly confirmed FHA Commissioner Montgomery have no illusions, his first order of business is to deal with the losses the HECM program has created in the MMIF and protect the MMIF. Then once some essential decisions have been made, he can begin considering if the HECM program needs higher or lower PLFs. I will not speculate on that subject.

      As to an alleged HECM endorsement prediction, please see the RMD column now over one month old on April 2018 endorsements at:

      For May 2018 endorsements, see HECM World at:

      Optimism rarely pays. I am a skeptic by training and a realist by birth but as my mother always reminded me: “Wear a smile and keep looking for the positive.” After the positive column on originators, I am being asked to present a positive outlook of the industry which is a few weeks away.

      Take care and I hope you had a great weekend.

  • I think on the wholesale side it is the broker getting out of the business that focused on hecm to hecm. With that market down significantly, my best guess is the broker is out moving out of the hecm space and going back to forwards. The low hanging fruit is gone so now the broker is looking for the next tree of low hanging fruit.

string(110) ""

Share your opinion

[wpli_login_link redirect=""]