Wholesale Leads Retail in January Reverse Mortgage Growth

Home Equity Conversion Mortgage (HECM) endorsements rose by 10.7% in the month of January 2021, for a total of 4,529 loans according to the latest HECM Originators report from Reverse Market Insight (RMI). The rise comes in the midst of generally heightened reverse mortgage industry activity that has been taking place over the past few months as the economic impact of the COVID-19 coronavirus pandemic continues.

Volume levels across both business segments recorded increases at the beginning of the year, with the retail segment rising 7.8% while the wholesale segment was the larger driver of activity exhibiting 14.1% growth. While the level of growth across both segments is lower than what was observed in December – which logged increases of 15.2% and 28% across retail and wholesale, respectively – the growth exhibited here continues to illustrate that consumers are seeing options in reverse mortgages either through refinances or wholly new loans.

Three top 10 reverse mortgage lenders saw impressive gains in January stemming from this industry growth across both business segments. HighTechLending led the way with a 67.9% increase in business to 94 loans, while Longbridge Financial jumped 59.8% to 513 loans, which RMI President John Lunde notes is a record high for Longbridge on the HECM Originators report.

Meanwhile, Ennkar, Inc. broke into the top 10 lenders for the first time, rising 58.9% to 89 loans. The rise in business for the lender undoubtedly contributed to its cracking of the top 10, but it was also likely incidentally helped along by the dissipation of now-defunct One Reverse Mortgage’s pipeline dissipating. While still technically the 14th largest reverse mortgage lender by volume over the 12 months ending in January, the now-shuttered One Reverse has not recorded any endorsements since May according to the data.

Other lenders which fall outside the bounds of the top 10 lenders also exhibited impressive growth, with Sun America Mortgage recording an endorsement increase of 178.9% over the last year, while Heritage Home Loans saw 250% growth in the same timeframe.

RMI President John Lunde previously detailed for RMD that the HECM Originators report is useful in seeing the splits in and health of the retail versus wholesale channels, which helps to illustrate how lenders are doing from a more individualized and channel-specific perspective.

Read the HECM Originators report at RMI for specific breakdowns and regional performance data.

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