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2 Comments
One of the major industry prognosticators is saying what a great month January was. Yet that does not seem to be the case.
Others are touting the January endorsements as a great month because it was so much better than they expected. Yet when one analyzes the endorsements by looking at the annualized conversion rate, this month is the very worst that can be computed based on public information dipping below 60% for the first time. So why the difference in views?
It is my perception that the first quarter of calendar 2014 of endorsements will be giving us a lot of false hope based on the pull forward effect of the originations of Standard ARMs which were closed in the last few months and are now being endorsed. By April we should stop seeing any significant number of Standard ARMs being endorsed. It is then that we will have a clear idea how well or how bad the new HECMs are doing industry wide.
The annualized conversion rate is a clear indication that things are not doing all that well.
I agree Mr Veale. In addition, it seems the sequester was indeed preventing HUD from endorsing loans in a timely manner. It’s my opinion that there are many loans that were endorsed in January that would have been endorsed last year had it not been for the sequester. I too think we will see endorsements going down as and after the first quarter unfolds.