Analytics provider Baseline is staking its claim in the reverse mortgage space. The firm offers clients a deep dive into HECM data with origination trends, performance stats and endorsement info – and companies are taking note.
Baseline launched two years ago, but it took time for the company to gain traction. Now, President Dan Ribler said it has picked up significant market share.
“Almost half of the broker dealers in the space subscribe to a service we have that looks at every loan ever created in the reverse space and allows them to go in and figure out what the predictors are for prepay and draw performance,” Ribler said. “Also six of the top 10 HMBS issuers rely on Baseline for valuation services, software or our expertise. We went from zero to industry fixture in two years.”
Baseline offers a variety of products for its clients, some of which can be custom-made and white labeled.
Last month, Baseline launched a HECM Index that tracks bond pricing, which follows the performance of a basket of 2017 PLF Annual LIBOR loans to give users a meaningful look at the market and its day-to-day variations.
Earlier this year, Baseline released a proprietary position management software that allows users to log in to view their entire pipeline.
“It’s like a secondary capital markets department all on a web-based software, where people can manage their positions entirely,” Ribler said.
Ribler said his tools can be helpful for companies that are new to the reverse mortgage business.
“If a larger financial institution wants to get involved in the space and do meaningful production, we can help them mechanically get the loans of the rack, get them securitized and get them sold,” Ribler said. “We can help manage the MSR, manage the risk associated with the servicing, manage all the unique challenges that the HECM creates. That’s one less hurdle that the company will have.”
“For people who are just getting into the reverse space, as long as you have the origination experience, we have the capital market experience,” he added.
Ribler said his data can offer real insight into the market's potential.
“For originators, we have a tool to help people figure out where they should be marketing, where there’s opportunity, where senior homeowners live, and conversely, where they should not be marketing, areas where there’s not a large senior population,” he said.
Of course, if the HECM business grows, so too will Baseline’s business. Ribler said that despite the down market, he believes in the potential.
“Every time there’s a change for the worse in the industry, we see a slowdown in volume and in 12 months or so, it starts to recover,” he said. “But the HECM program in general is pretty hard to beat. At Baseline, our money is on the HECM making a full recovery.”