HMDA Data Names Top 10 Reverse Mortgage Lending Lenders in 2020, Wholesales Outperforms Retail Sales in June 2021

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The Consumer Financial Protection Bureau (CFPB) has released a new report and analysis of data disclosed in 2020 by the Home Mortgage Disclosure Act (HMDA) to better understand the mortgage market landscape. The new analysis contains a wealth of information disclosed by financial institutions on mortgages and includes key information specific to the reverse mortgage industry and the Home Mortgage Mortgage Program (HECM).

In a year of heightened interest in reverse mortgage product and business activity within it, HMDA data helps provide some additional context for how businesses behave in relation to the broader mortgage market, as well as some key metrics reflecting the realities of the business that have been much discussed in the past. time. These include trends related to HECM-to-HECM refinancing, as well as comparisons between HECM and Home Equity Credit Lines (HELOC).

In addition, the reverse mortgage sector surpassed the retail channel for the first time in five months in June this year, according to data compiled by Reverse Market Insight (RMI).

HMDA data: HECM beats HELOC

In direct comparison to the reverse mortgage market, the HELOC market appeared to have a downward trend in 2020 when the data was examined by the CFPB.

“The significant increase in the total number of applications and applications in 2020 is due to the increase in closed mortgage loans,” – said in a message from HMDA. “The number of HELOC records continued its downward trend since 2018, and the total number of original HELOC documents fell from 1.042 million in 2019 to 869,000 in 2020. On the other hand, the total number of reverse mortgage sources increased from 35,000 to 43,000 per year compared to last year. … “

This is broadly in line with what other analysts in the reverse mortgage industry have been talking about an increase in volume in 2020, but the fate of HELOC could also be linked to the discontinuation of product offerings at some of the major lending institutions during the darkest days of COVID. 19 pandemic coronavirus.

In mid-April last year, JPMorgan Chase suspended According to the organization, its HELOC proposals are in the spirit of preparation.

“Due to economic uncertainty, we are temporarily suspending new applications for home equity lines of credit,” Trish Wexler, Chase’s director of public affairs for consumer and public banking, said in an email to RMD at the time. “Clients can still use their home equity by refinancing cash on their existing mortgage.”

This has led to some speculation by academics and professionals that a large institution that has suspended its HELOC offerings might give potential advantage by mortgage companies, according to Dr. Wade Pfau and Stephen Resch of America’s Finance Reverse (FAR). However, it is impossible to say if there is a direct link between Chase’s decision to suspend HELOC and the increase in reverse mortgages.

Top 10 Reverse Mortgage Lenders

The CFPB analysis of HMDA data also took a closer look at the top 10 lenders in the reverse mortgage industry.

“In total, the top 10 reverse mortgage lenders accounted for 39,649 reverse mortgage sources, or approximately 91.7% of all HMDA-registered reverse mortgage sources in 2020,” the data said. “American Group of Advisers [sic] was the largest reverse mortgage lender providing data to HMDA in 2020, accounting for approximately 35.0% of all reported reverse mortgage sources. It is followed by Finance of America Reverse LLC with an annual market share of 20.2%. ”

Chart showing the top 10 reverse mortgage lenders based on 2020 HMDA data. CFPB | CC0
CFPB HMDA Data for Top 10 Reverse Mortgage Loan Lenders in 2020.

Apart from AAG and FAR, the last remaining lenders in the top ten of the CFPB table include reverse mortgage financing (RMF); Mutual of Omaha Mortgage; PHH Mortgage Corporation; Longbridge Financial; Open mortgage; HighTechLending; Liberty Home Equity Solutions; and All Reverse Mortgage, respectively.

Interestingly, both PHH and Liberty are subsidiaries of Ocwen Financial Corporation, with Liberty acting as a division of PHH. At the time he was posted to PHH, the lender changed its name from Liberty Home Equity Solutions to the simpler Liberty Reverse Mortgage in March 2020, but the CFPB data still reflects the name the lender used at the beginning of the year. This corporate change likely required the submission of two datasets to HMDA for this period; one from Liberty and one from PHH.

Additional HMDA data with analysis of mortgage performance in 2020, including for reverse mortgages, may be obtained from the CFPB in the future. Read about mortgage market activity and trends in 2020 report in CFPB.

June 2021: Wholesale reverse mortgage channel overtakes retail for the first time in months

According to the latest HECM Originators report from RMI, HECM approval fell 4.2% in June 2021 to 4,158 credits. The drop comes amid a generally heightened activity in the reverse mortgage industry over the past few months as the economic impact of the COVID-19 coronavirus pandemic continues as volume again remains above the 4,000 loan threshold for the month.

Interestingly, June was the first time in five months that a wholesale channel surpassed its retail counterparts, with the shift generally affecting the performance of major reverse mortgage lenders in the country. However, only three of the top 10 lenders managed to increase volumes in June.

Mutual of Omaha Mortgage rose 43.5% to 333 loans, the highest monthly volume since changes in the Major Limiting Factor (PLF) took effect in January 2018. This was followed by an increase in HighTechLending by 10.5% to 95 credits, followed by an increase in FAR by 0.2% to 622 credits per month.

RMI President John Lunde previously shared with RMD in detail that the HECM Originators report is useful to see the separation and health of retail and wholesale channels, which helps illustrate how lenders operate from a more personalized and channel-specific perspective.

Read the creators of HECM report in RMI for specific breakdowns and regional performance data.

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