A new report aims to provide additional insight into the Home Equity Conversion Mortgage (HECM) marketplace by offering a look at which HECM mortgage-backed securities (HMBS) issuers buy HECM loans from which lenders.
The newly-created “Who Buys What From Whom” (WBWFW) report by financial services advisory firm New View Advisors compiles publicly available Government National Mortgage Association (GNMA, or “Ginnie Mae”) data showing which HMBS issuers buy HECMs from which lenders, or “Who Buys What From Whom” (WBWFW).
New View contends that, unlike using endorsement data, Ginnie Mae’s data showing HECM unpaid principal balance (UPB) securitized in the current month offers a more robust look at the activity within the reverse mortgage industry.
The report is organized into three separate tabs: the first tab features top originators, giving a ranking by original HECM UPB of all 1,229 lenders over the last twelve months. The second is the titular “WBWFW” tab, which gives an alphabetical cross-reference between every lender and the HMBS issuer that securitizes its loans. Finally, the third tab details top 100 trends, a breakdown of loan sales by month, by top-100 lender, and finally by HMBS issuer.
“The reason it’s valuable is that the user can see what the competition is doing in terms of who’s buying what, [and] who they’re buying them from,” says Michael McCully, partner at New View Advisors in an interview with RMD. “Even Ginnie Mae appreciates the report. And it creates a more level playing field using publicly available data.”
Endorsement data, while valuable, can be a lagging indicator of reverse mortgage market health, according to McCully. The reason for that is because there can be a delay between the time a loan is closed and endorsed.
There can even be timing issues at HUD, since the department often finds itself dealing with backlogs of endorsement files that take time to process, McCully says.
The “WBWFW” list is new to the market, as such industry feedback is still forthcoming. New View will continue its marketing of the list to broaden exposure across the industry, McCully tells RMD.
Find more details on the “WBWFW” aggregation at New View Advisors.