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   James E. Veale, MBT

   November 2, 2023 at 5:19 pm

   Making a prediction of the volume of HECM endorsements for this fiscal year may seem foolhardy this early in the year but I poled a few industry old times and their conclusion is that fiscal 2024 will result in the worst fiscal year for HECM endorsements since fiscal year 2003. Few believe that HECM endorsements will exceed 29,000 this next fiscal year.

   There has not been an October with this few endorsements since October 2002. It seems as if we are still marketing to existing HECM borrowers instead of first time borrowers. Total HECM Refis (i.e., HECM to HECM) had never been larger than 8,968 (endorsed in fiscal 2009) for any fiscal year until fiscal 2021 when thattotal reached 20,584 reaching their apex in fiscal 2022 with 28,749.

   It is important to clarify that last fiscal year which ended on 9/30/2023 had the worst percentage drop (48.8%) in HECM endorsements ever. Before that that (dis)honor belonged to fiscal year 2019 with a drop of just 35.3%. With the combination of higher 10 year CMT interest rates and lower PLFs, fiscal year 2024 may have lower HECM endorsements than any fiscal year since fiscal year 2003 (and, yes, I wrote that twice for emphasis).

   As usual, nothing, absolutely nothing was presented at the NRMLA annual convention on this topic. It deserves at least one session. This is a lost opportunity to let HUD know that their current MMIF policy means few large financial institutions will be interested in returning to the industry very soon with Mutual of Omaha being the main exception.

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