A long-term perspective of HECM endorsement volume
Our collective experience as reverse mortgage professionals shapes our perspective. Much of that perspective in recent years was influenced by falling endorsement volumes. The reverse mortgage industry posted a record 114,000 endorsements in 2009 just as the housing and economic crash began in earnest. Consequently volumes plummeted with housing values. In the years that followed, endorsement declines were commonly attributed to increased relegation and product changes. But what perspective can we gain when looking at our industry’s growth in the last decade?
James Veale is a numbers guy. Not surprising considering his extensive work prior to originating reverse mortgages as a Certified Public Accountant with a Masters in taxation. In his recent column published in Reverse Mortgage Daily Veale writes, “During the last decade, the industry produced more than twice as many endorsements (707,915) as the total endorsements for all fiscal years that preceded it (346,177). We not only saw the 500,000th endorsement in the last decade but also the 1 millionth.”
As a frame of reference, let’s review previous HECM marketing efforts.The summer edition of Reverse Mortgage Magazine published by the National Reverse Mortgage Lenders Association (NRMLA) touted 2017 as the ‘30th anniversary of the HECM’. In its first decade, the HECM was a relative unknown to older homeowners. That quickly changed in the mid-2000’s when big bank lenders such as…
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For the last two segments of his advise on selling HECMs, John Luddy has expressed his dismay over how gloomy the general attitude of attendees was at the NRMLA Western Conference earlier this year.
The July-August 2017 edition of Reverse Mortgage magazine had an article taken from interviews with different industry leaders telling us how things went this last decade. The strange thing is that not even the industry statistician, John Lunde, presented the numbers and information that James and Shannon did. So why? They all share the same information. That portion of the article in the Reverse Mortgage magazine was anything but a celebration.
What the industry lacks right now is realistic leadership with a positive outlook. Leadership failed near mid decade. They have not seemed to get past it. We are stuck in secular stagnation and few are attacking it as recommended by former Secretary and Harvard Economics Professor Larry Summers.
Yet industry leadership achieved much. We left the cottage industry stigma and we overcame the loss of B of A, Wells Fargo, and MetLife. The product has had major changes. The leaders adjusted well from the days of Fannie Mae purchasing our loan production to Ginnie Mae issuing HMBSs.
Our leadership failed but also changed the face of our industry. Industry leadership needs to get over its gloom and doom and take the lead in celebrating our last decade. They deserve much credit for it.