Metlife Exits Reverse Mortgages

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Metlife Exits Reverse Mortgages

MetLife Leaves Reverse Lending

First came the rumors then the other shoe dropped. MetLife Bank, NA, the nations top reverse mortgage lender, left the space. A look at the possible causes and more importantly what to watch for in the wake of their exit. Watch the video for more.


Scott Alexander April 30, 2012 at 8:04 am

Well, when they are only lending 40 to 60% LTV, they are probably going to look pretty sweet in ten years. We have to believe the national average increase will start coming back soon around 4%. If it doesnt, the banking industry along with every home owner will have much bigger problems, such as when will our flag be changed from red white and blue to Chinese flag. If your question would have been addresses 15 years ago and not swept under the rug by money hungry lenders, we wouldt be in this situation now. Reverses originated 15 years ago along with other negative amortization loans really look terrible right now!

The_Cynic April 30, 2012 at 10:09 am

MetLife never was nor has been the player in our space that Wells or B of A were. In its history in our industry MetLife has to day less than 22,000 endorsements(less than 3% of all HECMs ever endorsed) to its name. Wells Fargo had almost 19,000 endorsements for fiscal 2009 alone.

While the loss of MetLife might mean a rise in the endorsement numbers for the remaining Top Ten, some believe that the market as a whole will suffer even further erosion in total endorsement numbers during the next fiscal year.

James E. Veale, CPA, MBT April 30, 2012 at 11:47 am

The news of the day is not the loss of MetLife, it is the Outlook report just released by HUD for the month of March 2012. On a year over year basis the number of HECM case number assignments is shrinking even further. Without MetLife, the number for May 2012 may be worse.

With HUD indicating that the pull through rate is far worse than at any time in the last few years, the strength of endorsements for this fiscal year has weakened. The current trend is more towards 54,000 than 58,000 for the current fiscal year, ending September 30, 2012. Although somewhat early, the trend for calendar year 2012 could be much closer to 50,000.

The trend for the calendar year has much more to do with MetLife than the fiscal year. It seems consumer confidence that home values will increase near term in evaluating the reverse mortgage decision has eroded yet further. Worse our marketing message has only become staler with time.

So despite the recent good press, the environment for endorsements is weakening still further. With the sophisticated economic, financial, and real estate projection tools available to firms the size of Wells Fargo, Bank of America, and MetLife, is it any surprise they have moved out of our market.

Jeff Bush June 3, 2012 at 8:38 am

With the “Big 3” exiting the business there is much opportunity in marketing reverse mortgage loans for retail. I am seeing increased response rates on my direct marketing for reverse mortgage prospects who currently have Wells or BofA forward mortgages. Thier bank is not marketing them any longer. The overall market will be down but if you do retail you could grow by 500% this year!


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