HECM saw a major pullback in approvals at the end of 2022

Home Equity Conversion Back-to-back mortgage loan originations slowed at the end of 2022 in what turned out to be a quarter they might want to forget .

New approvals in November totaled 3,270, a 6.6% decrease from October’s figure of 3,500, with three of the top 10 recording a monthly gain, according to the latest data. provided by Reverse Market Insight. Retail sales fell 6%, while retail sales fell 7.3%.

But the number of confirmations on the 12-month trial also came to 61,205, an 18% annual increase from 51,824.

The comparative data reflected the large amount of tension faced by those caused by the fourth quarter and the entire year 2022. high level over a decade before falling to multi-year lows a few months later as interest rates rose.

November also ended with the bankruptcy of Reverse Mortgage Funding, one of the largest lenders in the sector. Before it was announced file for Chapter 11 at the end of the month, the RMF stopped new starts in the previous weeks. But with a small 8% market share based on evidence, the Bloomfield, New Jersey-based company is still ranked as the fifth largest HECM originator until the time of the announcement. Approvals in the RMF fell from 294 to 287 between October and November.

While the full impact of the departure of the RMF may take some time to fully realize, a quick look at Reverse Market Insight’s December evidence showed more softening ahead, with decrease in monthly volume is close to 15%.

As the mortgage market continued to reel from the RMF news, the nation’s largest mortgage brokers agreed to a major deal just days later, and No. 2 Finance of America Reverse. sales leader American Advisors Group. The U.S. Treasury previously suspended commercial lending to focus on other avenues, including commercial and business mortgages and home improvement.

In November, the LDS once again led all startups with 720 approvals, ahead of US Treasury, which recorded 352. In contrast, October approvals came in at 840 and 445, respectively. respectively for the two companies. The total market share in the year to date of both businesses combined is 43%, with 27% of AAG and 16% of Finance of America.

In third place with a 13.9% share of Longbridge Financial, he was one of the few startups that saw an increase in numbers in November. Confirmations rose 2% to 450 from 441 a month earlier.

Weeks after leaving Reverse Mortgage Funding, Ginnie Mae, part of the Department of Housing and Urban Development that runs the government’s HECM program, stepped in. capture the file of the bankrupt company and take the service of loans, in order to reduce problems for customers.

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