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Retail Segment Leads October Jump in Reverse Mortgage Endorsements

Home Equity Conversion Mortgage (HECM) endorsements rose by 36% in the month of October, for a total of 2,551 loans according to the latest HECM Originators report from Reverse Market Insight (RMI). The rise was led by the retail endorsement segment of business, which experienced an increase of 45% that month, while wholesale levels recorded a smaller increase of 22.7%.

Unlike another rise in February that was driven primarily by an obfuscation in the data due to the lingering disruption of a partial federal government shutdown, the increase seen in October is descended from a favorable rate environment according to RMI President John Lunde.

“That’s the highest monthly total since February, and that was fueled more by a backlog of endorsement activity rather than the higher origination volumes driven by lower interest rates as is currently the case,” Lunde said in his commentary accompanying the data.

While the top 10 lenders are described as “underperforming slightly,” many of them experienced positive gains for the month. Leading the way is American Advisors Group (AAG), which posted a 62.9% increase to 1,337 loans, more than four times the number of the next closest lender.

One Reverse Mortgage recorded an increase of 53.5% to 284 loans, while Liberty Home Equity Solutions gained 52.1% to rise to 213 loans. After a down month experienced in September, HighTechLending recorded a 66.7% increase to 65 loans, marking a “bounce back,” according to Lunde.

Although the overall percentage figure is nearly identical to RMI’s previous October 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.