Wholesale Reverse Mortgage Segment Outperforms Retail in September

Home Equity Conversion Mortgage (HECM) endorsements fell by 1.9% in the month of September 2020, for a total of 3,923 loans according to the latest HECM Originators report from Reverse Market Insight (RMI). The fall comes in the midst of generally heightened reverse mortgage industry activity that has been taking place over the past few months as the economic impact of the COVID-19 coronavirus pandemic continues.

The very slight volume reduction was primarily led by the retail endorsement segment of business, with wholesale endorsements dropping by 0.7% while retail endorsements fell by 2.9%. In terms of wholesale originations, Finance of America Reverse (FAR) took the top spot, though in terms of strictly wholesale origination growth, American Advisors Group (AAG) managed to grow at a faster pace in September than either Liberty Reverse Mortgage or Reverse Mortgage Funding (RMF), both of which had stronger overall wholesale endorsements than AAG.

On the retail side, AAG continued to maintain its position in the top spot, maintaining over 35% of total HECM market share over the 12 month period ending in September.

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Four of the top 10 lenders posted general gains for the month. Open Mortgage leads the pack overall with a 35.2% jump to 242 loans, their highest level in a year according to RMI. FAR followed, rising 21.3% to 66 loans for the month of September. Liberty meanwhile gained 10.1% to hit 328 loans, while AAG gained 20 loans more than its August total to settle at 1,399 for the month. Fairway stayed in positive territory by breaking even with 160 loans in both August and September.

While still technically the 9th largest reverse mortgage lender by volume over the past 12 months ending in September, the now-shuttered One Reverse Mortgage recorded zero endorsements in both August and September.

RMI President John 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 HECM Originators report at RMI for specific breakdowns and regional performance data.

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