The record of residence fairness conversion mortgage lenders noticed a brand new chief on the high in a 12 months that introduced creating curiosity within the section and the rise of proprietary merchandise, but in addition volatility.
Mutual of Omaha Mortgage led all lenders in HECM endorsements, supplanting Finance of America Reverse, the corporate within the No. 1 place on the finish of 2023. Mutual of Omaha reported 6,149 of the Federal Housing Administration-backed reverse mortgages in 2024, a quantity that was 1.5% decrease than its 6,240 endorsed a 12 months earlier. The numbers come from a report issued by Reverse Market Perception.
In the meantime, Finance of America noticed quantity fall by greater than a 3rd, or 33.8%, to five,946 final 12 months in comparison with 8,981 in 2023, when it acquired approval for its acquisition of the earlier long-time chief within the house, American Advisors Group.
The change on the high occurred regardless of the merger between two lenders that, mixed, far outpaced their opponents in endorsement quantity earlier this decade. AAG by itself led all HECM suppliers in every of the previous years, with Finance of America historically among the many high 5.
The drop in Finance of America’s quantity got here, although, as the corporate targeted on consolidating belongings belonging to AAG originally of 2024, a activity that included aligning origination programs and in addition embarking on a brand new advertising and marketing technique.
The lower in HECMs additionally might also replicate the corporate’s efforts to lean into and promote its personal proprietary merchandise, a method it mentioned it wished to concentrate on in late 2023.
By market share, Mutual of Omaha accounted for 22.9% of 2024’s quantity, with Finance of America simply behind at 22.2%. Falling in line behind them had been Longbridge Monetary, Liberty Reverse and Fairway Unbiased Mortgage, with 12.3%, 4.2% and 4%, respectively.
The slowdown in HECM volumes 12 months over 12 months among the many high lenders corresponded to general tendencies within the section, with 26,834 complete endorsements industry-wide in 2024. The quantity was 12.2% beneath the 30,550 recorded a 12 months earlier.
The 12-month interval offered combined fortunes, in accordance with Reverse Market Perception. Extra lenders poured sources into creating their reverse-mortgage divisions, however 2024 “finally resulted in disappointing style” as a result of upward trajectory of rates of interest, RMI mentioned.
The quantity of tappable residence fairness out there to owners 62 and older, the goal marketplace for HECMs, elevated to $14 trillion within the second quarter final 12 months, the Nationwide Reverse Mortgage Lenders Affiliation estimated.
Taking out there fairness into consideration together with mortgage charges that at present are greater than double the place they sat in the beginning of 2022, mortgage companies see potential alternatives out there for reverse loans and different liens permitting owners to faucet into accrued quantities.
Rising charges, although, nonetheless managed to successfully lower the urge for food for the federally sponsored home-equity product, RMI reported. “From right here on, these volumes are swimming upstream for so long as charges hold ramping upward.”
Price headwinds, although, could lead debtors to think about the proprietary second-lien choices that emerged prior to now two years in its place.
The previous 12 months nonetheless completed with endorsement volumes on the rise however primarily as a consequence of exercise flowing by means of from earlier months earlier than charges jumped, in accordance with RMI. In December, endorsements totaled 2,626 throughout the {industry}, up 9.1% from November.
Markets within the Southeast/Caribbean division closed 2024 with a rush of 724 new HECM endorsements, the best month-to-month complete for any area over the earlier 12 months. The quantity represented a 42% leap from November.
The FHA-designated Pacific/Hawaii area noticed 608 loans endorsed in December, down 3.2% month over month from 628. Six out of 10 of the federal government geographic divisions posted a rise in quantity to finish 2024.
