Reverse mortgage applications came in at 7,398 units for March, up 11.4% from February according to the latest Federal Housing Administration Outlook Report. Despite HECM applications being down 54.1% during FY 2010, March is the second straight month over month increase in applications and is encouraging considering volume has been trending lower all year.
During March, the industry endorsed 5,822 HECMs, consisting of 5,394 traditional HECMs, 76 reverse mortgage for purchase and 352 HECM refis. In terms of product mix, the percentage of adjustable rate HECMs is down 73.5% during FY 2010 as the HECM fixed product continues to surge in activity.
According to FHA, the seasonally adjusted annual rate for all applications jumped 18.3% to 2,378,700 in March, due to a surge in applications the last week of the month, as prospective mortgagors sought to beat the increase in the upfront mortgage insurance premium, from 1.75% to 2.25%, effective April 5.
There were 246,406 applications received this month, up from 165,239 last month. This included 163,467 purchase cases, 75,541 refinances and 7,398 HECM’s. The refinance applications consisted of 17,356 prior FHA cases and 58,185 conventional conversions to FHA. Included in these refinance mortgages were 54 H4H cases.
Former staffers from HUD, FHA and the GSEs weigh in on how to press ahead in this volatile reverse mortgage climate.