June Reverse Mortgage Endorsement Drop Led by Retail Segment

Home Equity Conversion Mortgage (HECM) endorsements fell by 5.6% in the month of June, hitting a threshold of 2,544 loans according to the latest data from Reverse Market Insight (RMI). The drop was led primarily by the retail endorsement segment of business, which experienced a drop of 8.7% that month, while wholesale growth managed to remain nearly steady by dropping only 0.9%.

Only three of the top 10 lenders recorded gains for the month as similarly noted in June’s HECM Lenders report, but some of the specific figures have been revised upward. For instance, HighTechLending – June’s most visibly improved lender – recorded a 73.5% rise in endorsements to 59 loans, up from a previous figure of 68.6%.

Also revised upward was Finance of America Reverse’s June growth rate, now at 35.8% compared to the previously recorded jump of 21.6%. Fairway Independent Mortgage Corporation maintained its 40% growth rate in June according to the new RMI report.

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In terms of why the retail side is leading in terms of endorsement drops, RMI President John Lunde said that the overall reasoning was unclear.

“It’s really hard to tell,” Lunde said in an email to RMD. “[Both the retail and wholesale endorsement figures] are back at their March levels, so the last few months might just be noise between the channels.”

March’s endorsement data was still seeing the effects of the partial federal government shutdown that stretched from December 22, 2018 to January 25, 2019.

Although the overall percentage figure of endorsements is nearly identical to RMI’s previous June HECM Lenders report, Lunde previously detailed for RMD that the HECM Originators report is useful in seeing the splits in and health of the retail versus wholesale channels, which helps to illustrate how lenders are doing from a more individualized and channel-specific perspective.

Read the full HECM Originators report at RMI for specific breakdowns.

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  • While the info is helpful when broken down between retail and wholesale, how much better would it be if the same categories were further broken down between calling centers and all other sources. While HUD does not have that data the lenders do. So why isn’t that data being shared with the industry as to those monthly totals?

    About five years ago, a few industry dreamers were declaring that lenders and members of the industry had entered into an era of collaboration yet like a dream such delusions quickly evaporate. None of these folks have tried to convince us using such propaganda since.

    Yet at the end of a fiscal year of horrendous percentage loss in endorsements like this fiscal year, it is time to ask why don’t we see at least data collaboration among lenders. Lenders will not even collaborate to tell us what monthly total industry wide proprietary reverse mortgage closings are.

    So if the industry really wants to demonstrate that it has the capacity to collaborate why not just provide call centers versus other sources of monthly endorsements and also total monthly industry wide proprietary reverse mortgages.

    Industry dreamers have been talking about 32,000 proprietary reverse mortgage closings this fiscal year. Is it that the industry is afraid of disillusioning and thus perhaps discouraging a significant portion of its originators through facts?

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