Originators of Home Equity Conversion Mortgages saw endorsement figures drop 17.3% in March, according to the most recent figures from Reverse Market Insight — dragged down by a “stunning” 28.7% decline in wholesale originations.
The industry, including both Federal Housing Administration-approved and non-approved lenders, logged 4,298 loans in March, representing the second consecutive month of sharp drops; February’s 5,195 was a 17.6% dip from January, when the full force of the pre-October 2 surge was finally proven in the numbers.
The numbers were even bleaker on the wholesale side, with just 1,815 loans last month — a drop of 28.7%. After a January glut that saw 3,121 reverse mortgages generated through the wholesale channel, the bottom appears to have fallen out, with an 18.4% decline in February.
But the spread between the two primary channels in February was much narrower, as retail lenders saw a 16.9% drop that month; in March, retail volume only slowed by 6.3%. RMI founder and president John Lunde said that split is typical of major shifts in the reverse mortgage industry in either direction.
“Usually brokers are more nimble, given they have less investment in the space than a full retail operation,” Lunde told RMD. “It’s the same pattern we’ve seen in both up and down cycles historically.”
The Dana Point, Calif.-based RMI found some bright spots in the otherwise bleak numbers, pointing out that Nationwide Equities rebounded from an “outsized” decline in February to claim a 37% boost in March, while Live Well registered a 36% gain. Finally, One Reverse Mortgage logged a 3.2% uptick “to continue one of the steadier performances in the industry,” RMI observed.
The top five lenders in the industry over the last 12 months remain American Advisors Group, Finance of America Reverse, Reverse Mortgage Funding, Liberty Home Equity Solutions, and Synergy One Lending — the latter of which was recently sold to Mutual of Omaha Bank.
Check out the full statistics at RMI.
Written by Alex Spanko