Reverse Mortgage Volume Falls to 2005-Era Lows

Reverse mortgage volume continued on a downward trajectory in June, falling 15% relative to May endorsements, according to Reverse Market Insight. With a total tally of 2,838 Home Equity Conversion Mortgages endorsed in June, volume is at its lowest monthly level since May 2005, RMI noted in its monthly commentary.

Many have speculated about the “new normal” for reverse mortgages following major program changes implemented in October 2017, and originators this week weighed in on the volume losses they are experiencing—pointing to volume declines ranging from 10% to 50% since October.

Regionally, among the top 10 metros tracked by RMI, eight saw volume declines during June, with New England and the Great Plains region seeing single-digit volume upticks.

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All lenders on the top 10 volume list experienced declines during June, according to the RMI report, with top lender AAG’s volume falling 13% month over month to 874 endorsements and second-spot Finance of America Reverse experiencing a 9% volume loss during June with 275 endorsements.

View the RMI report.

Written by Elizabeth Ecker

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  • Why did RMI claim in a June 6, 2018 article on this very same website that the slight increase in endorsements in May 2018 indicated that this “is the biggest sign yet that HECM volume may have bottomed following the substantial program changes that took effect Oct. 2, 2017?”

    This was a 15.5% loss in endorsements from May 2018 endorsements (“the biggest sign”). How did that happen? A 521 endorsement loss in just one month that RMI did not see any sign of coming?

    Wow!! How do these kinds of predictions ever happen?

    • Carmine, normally the RMI commentary on their Lenders’ Report gives paragraphs of insights but this month all it says for July 2018 is:

      “HECM endorsement volume dropped 15.5% in June to 2,838 units, the lowest endorsement level seen since May ’05.

      Being short staffed with the holiday and travel, we are keeping the commentary to that headline number this month.

      Happy Independence Day!”

      It is hard to face failure. It is worse when you write something but fail to mention it.

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