Reverse Mortgage Lender Sees Expansion Opportunity In Wake of Market Challenge

Reverse mortgage lender 1st Financial has launched an expansion into several new states, and is marking growth through new hires nationwide in light of market challenges that are reshaping how some lenders do business.

The company, a division of Plymouth, Michigan-based Success Mortgage Partners, which has long operated in Michigan, Florida, South Carolina, Georgia, and Indiana, has recently expanded into Texas, Illinois and North Carolina through the addition of two new branches and four new originators.

While some reverse mortgage originators are scaling back operations in light of regulatory pressures and recent and upcoming product changes, 1st Financial sees some of the resulting consolidation as an opportunity.

“The industry is certainly more challenging at the present time,” says Mike Gruley, 1st Financial Director of Reverse Mortgage Operations, of the many sweeping changes the reverse mortgage industry has experienced of late. “As can be expected in times like these, some companies are reorganizing, some are contracting, and others are expanding. We believe that, more than ever, feet-on-the-street originators need a solid, reliable support system to help them maintain their customer service levels and market share. Quite simply, that’s what we try to provide, and it is attracting quality team members.”

The landscape isn’t without remaining uncertainties, Gruley says, noting the additional volume pressures that will stem from the upcoming financial assessment expected from the Department of Housing and Urban Development in the coming months.

In fact, the majority of the top 10 reverse mortgage lenders have seen volumes take a downward turn in recent months, with only American Advisors Group and Live Well Financial seeing year over year gains in the Top-10 lenders year to date as of June, according to Reverse Market Insight.

“As Financial Assessment eventually rolls out, there may be some additional downward pressure on unit volume, and that too, in turn, may increase the consolidation pressure, but it doesn’t have to be a bad thing as long as lenders have the type of delivery model that is suitable and appropriate for such a market environment,” Gruley says.

For his company, targeted expansion has included the addition of six new originators in its existing markets and a continued outlook that remains optimistic based on reverse mortgage product elements and a growing demographic that supports its borrower base.

Written by Elizabeth Ecker

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