The reverse mortgage industry continued its slump into May, as retail and wholesale endorsement volume dropped 15.3% compared with the previous month, a report from Reverse Market Insight noted this week.
And although many were hopeful that the industry would absorb Bank of America’s volume after its exit from the market, RMI data shows a decline in reverse applications. Initially, applications went up 8.5% in March, after BofA stopped taking them in February. After that, applications dropped 9.5% in April, and 8.3% in May.
Source: Reverse Market Insight, July 2011
RMI points to a chart that shows HECM applications per business day in March and April. Since BofA formerly held about 10-11% of the retail endorsement volume, the chart’s data can make a case that more than half of BofA’s volume has been lost since the bank’s exit, RMI writes.
June application numbers may get a boost, says RMI, since Wells Fargo loan officers were allowed to accept them through that month. Endorsement numbers won’t reflect Wells’ exit until the fourth quarter, however, but either way, RMI expects an overall decline in HECM endorsements, especially now that Financial Freedom, BofA, and Wells Fargo, which collectively represented 30-35% of total endorsement numbers in the industry, are all officially finished accepting applications.
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Written by Alyssa Gerace
