Nationstar Mortgage Holdings, Inc. (NYSE: NSM) has confirmed it will no longer originate reverse mortgages through its Greenlight Financial platform. It will continue to service its Home Equity Conversion Mortgage servicing portfolio, valued at nearly $30 billion.
After acquiring Greenlight Financial Services in 2013, including both forward and reverse originations platforms, the company says it will be winding down the reverse portion of the business next month.
“The volume from that business was minimal, and we did recently make the decision to stop originating reverse mortgages,” John Hoffmann, Nationstar spokesman told RMD in an email. “We are winding down the business in an orderly fashion to take care of the customers already in the pipeline, and we expect to wrap up reverse originations completely sometime next month.”
Greenlight Financial’s reverse mortgage division was re-launched in July 2011 under the leadership of reverse mortgage veterans Dave Bancroft and Paul Scheper as a retail-only call center operation. Servicing giant Nationstar Mortgage later acquired Greenlight in its entirety in May 2013 for a purchase price of up to $75 million in cash with the expectation of “sizable volume and profitability uplift.”
In 2013, Nationstar originated 678 reverse mortgages through the greenlight channel, according to data compiled by Reverse Market Insight, a roughly 40% increase over its 2012 total of 485 loans originated through Greenlight Reverse. To date, the company has originated 94 reverse mortgages in 2014.
Although Nationstar will no longer originate reverse mortgages, it will continue to service its substantial reverse mortgage portfolio at $28.9 billion unpaid principal balance as of March 31.
“Our emphasis in reverse has always been and continues to be on servicing,” Hoffmann said. “We’re one of the largest reverse mortgage servicers in the country, and we’re committed to that business.”
Written by Emily Study and Elizabeth Ecker
