Premier source of reverse mortgage data, Reverse Market Insight released a recent paper showing the performance of overall HECM loan endorsements between January and February. The endorsements took a fall, but still up compared to the same span of time the previous year.
In its paper, HECM originators endorsed 8,997 loans during the first two months of 2017, an increase of 6.3 percent compared to last year. That translates into 531 more HECM endorsements. But the trend isn’t unique. Last year, the first two months of 2016 also experienced a decline from the previous year, a drop in fact of 12.3 percent from the same period in 2015.
- The number of endorsed units in 2016 dropped to 48,732 from 56,363 last year – a 13.5 percent decrease.
- The number of active originators also decreased by 3.1 percent from 713 in February 2016 to only 691 in February this year. Los Angeles, San Diego, and Denver are the top cities that hold the most number of active originators.
- Refi transactions in February 2016 was 12 percent and increased to 14 percent this year.
- Colorado and Washington remain on top spots for HECM growth.
- California still tops endorsement numbers by volume.
Reverse mortgages are a type of mortgage designed to help seniors aged 62 years and above gain access to their home equity. The appreciation of home values in recent years may have fueled the motivation to tap into earned equity and loosen cash flow. This is especially helpful to those who seniors who plan to stay in their home.
*Reverse Market Insight provides the market with intelligence, analysis, and customized business solutions to the reverse mortgage industry, helping clients analyze and interpret key trends impacting their business.