Summer is gone and apparently the reverse mortgage market cooled down a bit early as well. We already knew that total industry activity was down 9.2% in August from July from the Retail Leaders report, but what we didn’t know is that the weakness was almost entirely in the direct lender side of the business rather than wholesale/broker volumes. This is somewhat against the trend we’ve seen so far this year, but given all the recent news out of FHA regarding broker approval process changes and net worth requirements increasing, perhaps this is will be a one month trend (would that be a trend or a point?).
Enough with our word play, there are a few interesting points to note in this month’s report. Highlights:
- Leading off with some good news, we can welcome Financial Freedom back to the 4 digit club for the first time in a while, as they recovered from what was probably a misleadingly low June performance (369 loans) to 1,151 in August
- As the financial services industry continues to consolidate in spite of all the hand-wringing about ‘too big too fail’, our little corner of the world saw some of the same trends despite the increased broker activity noted above. For the first time since April, we had 4 separate lenders each with over 1,000 loans in August. We just missed having 5 lenders in the club for just the second time ever (Dec 2008), as Genworth’s recent product additions and wholesale sales force investments are bearing fruit – 934 total loans in August
- It’s no surprise to anyone who’s been reading this column that Metlife is the fastest growing wholesale lender in the past twelve months, but what might be more surprising is Generation, Genworth and Urban close behind at 2-4, respectively. Seems Sherry and Bob won’t ever tire of competing with each other, and I’m sure there are plenty of brokers out there happy to be benefiting from the friendly rivalry!
- And in case anyone doubts the power of distribution and brand in the retail side of this business, Bank of America is proving every day that bank branches are a superb source of reverse mortgage business. Not only is BofA the fastest growing retail lender in the country, they’re growing more than twice as fast as the runner up.
- That being said, the second fastest growing retail lender is proof that bank branches are not the only way to do business. One Reverse Mortgage is taking the direct to consumer approach and thriving.
Click the report link below for full details.
