A new chart from Reverse Market Insight shows that single male borrowers exhibit consistently higher usage of reverse mortgages compared to females or multiple borrowers.
According to RMI, the amount of cash borrowers draw at closing and over the life of the loan has become increasingly important given the reliance on HECM MBS securitization. “Utilization rates express borrower draw behavior as a function of principal limit available, both at closing and each month thereafter,” said RMI.
If the loan is included in a Ginnie Mae HMBS security, once the loan hits 98% of the max claim amount, the issuer must buy the loan out of the security even if the loan isn’t assignable to the Department of Housing and Urban Development. Therefore, the more money borrowers withdraw from the loan, the faster they hit 98%.
Looking for more reverse mortgage charts? Check out the Chart of the Day Series and pervious posts here.
