Retail Reverse Mortgage Volume Dominates Wholesale in May

Home Equity Conversion Mortgage (HECM) endorsements rose by 3.8% in the month of May 2021, for a total of 4,342 loans according to the latest HECM Originators report from Reverse Market Insight (RMI). The rise 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, as volume again remained above the 4,000 loan threshold for the month.

In terms of delineating between volume on the retail and wholesale sides of the business, the increase was led commandingly by retail endorsement growth which saw a jump of 10.6% in May. The wholesale segment of the business fared far below retail, falling by 5%, marking the fourth consecutive month in which the retail segment of the business outperformed its wholesale counterpart.

Only three of the top 10 reverse mortgage lenders managed to mark an endorsement increase for the month of May, with American Advisors Group (AAG) cleaning up the field with a jump of 32% for a total of 1,691 loans for the month, over 1,000 loans higher than the second place company. That company, Finance of America Reverse (FAR), was still no pushover, tallying 621 loans for the month of May across both segments.

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FAR maintained its hold on the top-ranked wholesale position, with a network of 666 active brokers capturing 29.4% of the wholesale market. They are followed by Longbridge Financial, with 187 active brokers capturing 14.4%.

HighTechLending, meanwhile, jumped 16.2% to 86 loans, while Advisors Mortgage Group rose 10.5% to 63 loans. Every other top 10 lender saw reductions for the month, albeit relatively minor ones.

Of the 10 national regions tracked by RMI based on data from public sources and its own internal analysis and measurement tools, six of them recorded higher volume in the month of May while those six have also become the top 6 of 7 regions for the year so far.

Leading the gains in terms of raw percentage increases were the Mid-Atlantic region (rising 24.5% to 239 loans); followed by the Northwest/Alaska region (rising 16.7% to 496 loans) and the Southwest (rising 15.5% to 394 loans), which itself saw a 12-month high according to RMI.

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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