A report this week from Reverse Market Insight identifies a plateau in application data for the first months of 2011, with a question as to whether endorsement data will amount to a double dip for reverse mortgages through May of this year.
“Endorsement volumes are pointing downward again for the past two months, showing an eerie resemblance to the trend-line last year at this same time,” RMI said in an email report.
May endorsements fell 15.3% from April, and were at the second lowest level since December 2005, despite posting a near 14% increase over May 2010.
Source: Reverse Market Insight
While the endorsement data paints an unsettling picture, RMI says, the application trends must be considered in order to get a full view on where the industry may be headed.
Accounting for seasonal trends by using data on applications per business day, RMI finds applications plateauing, due in part to Bank of America and Financial Freedom’s recent exits from the business. The report also notes a decline in pull-through trends, with May endorsements equating to 70% of January applications. While RMI expects the rate to improve back to more normal levels of 75-80%, it says the trend is worth watching.
View the full report.
Written by Elizabeth Ecker
