Key facts
- HECM endorsements fell in July to 2,034 from 2,064 in June.
- Finance of America (FOA) led HECM endorsements with 498 in July.
- HMBS issuance rose slightly to $463 million in July, up from $456 million in June.
- Mutual of Omaha ranks No. 1 for HECM endorsements year-to-date with a 21% market share.
- FOA ranks second year-to-date with 19.5% market share.
- The top 5 HMBS issuers have consolidated into a 'Big 3' of FOA, Longbridge, and Mutual of Omaha.
HECM endorsements saw a slight decline in July, with Finance of America (FOA) leading the pack, while HECM Mortgage-Backed Securities (HMBS) issuance remained weak, nearing 14-year lows. According to data from New View Advisors, the top 15 originators endorsed 2,034 HECM loans in July, a decrease from 2,064 in June. FOA led with 498 endorsements, followed by Mutual of Omaha Mortgage with 377 and Longbridge Financial with 351.
For the year ending in July, Mutual of Omaha leads in endorsements with 5,189 loans and a 21% market share, with FOA in second place with 4,822 endorsements (19.5% market share) and Longbridge in third (4,162, 16.8%). The HUD homeownership center in Santa Ana, California, led regional production with 660 endorsements in July.
Despite higher interest rates, HECM production remains subdued. Industry growth is being driven by proprietary products that offer advantages like higher loan amounts and no upfront mortgage insurance premiums. John Luddy of Supreme Lending noted that interest rates are not a primary concern for him, emphasizing the opportunity to help people understand and utilize reverse mortgages.
HMBS issuance saw a marginal increase to $463 million in July, a $7 million rise from June but significantly down from $541 million in July of the previous year. This level marks the 12th-lowest month for HMBS issuance since 2009. FOA was the top HMBS issuer in July with $177 million, followed by Longbridge ($141 million) and Mutual of Omaha ($86 million). The report highlights a consolidation of top issuers into a 'Big 3': FOA, Longbridge, and Mutual of Omaha.
Original or 'first participation' production reached $305 million in July. For the first seven months of the year, FOA led first participation issuance with $695 million, followed by Longbridge ($613 million) and Mutual of Omaha ($424 million). Tail issuance, which represents subsequent participations in existing reverse mortgage lines, totaled $158 million in July.