As new program changes like the Financial Assessment had a profound impact on endorsement levels for the better part of last year, the trend line of reverse mortgage volume in 2015 resembled nothing short of a roller coaster ride. And with January volume already lower than expected, the reverse mortgage industry will need some of aggressive volume growth in the months ahead.

Home Equity Conversion Mortgage (HECM) endorsements finished 2015 with 56,363 units, putting the full-year tally 6.4% higher than the 2014 total of 52,949 loans, according to industry data tracked by Reverse Market Insight (RMI).

Despite the gain, RMI notes the industry will to “aggressively increase” endorsement volume in order to maintain a rolling year-to-date growth percentage to combat 2015’s June-July-August figures—when volume was at its highest levels during the year, primarily due to a rush of borrowers obtaining HECM case numbers before the Financial Assessment actually took effect. 

(Source: Reverse Market Insight, Inc.)

To illustrate the roller coaster that was 2015, volume remain somewhat flat for the first five months of the year, before spiking 23.9% in June. Volume then tempered the following month with a minor drop in production, and just when it looked like the ride was finally coming to a slowdown, volume hit a crescendo in August as 2015 peaked with a single-month total of 5,750 loans.

It was then all downhill from there. As of January 2016, HECM endorsements were down roughly 32% from their peak as a result of the Financial Assessment’s impact, according to RMI’s analysis.

But refrain from exiting the vehicle and keep both arms and legs in a secured position, because the ride isn’t over just yet.

View the RMI report.

Written by Jason Oliva