Posts Tagged ‘Urban Financial’
As we saw last month, the downtrend in application numbers is finally starting to significantly impact endorsement numbers. That trend has continued in April, with overall industry numbers down to 5,511 units, dropping 5.3% from March.
Thankfully (if you’re among the survivors), there was an even greater decline in active lenders (down 7%) that translates to an almost imperceptible uptick in average loans per lender. It’s nothing to write home about, but at least it’s helping keep some heads above the water.
- Several regions saw modest volume increases in April, including the Mid Atlantic region that includes Baltimore. If you missed our prior newsletters about what’s occurring in the Orioles’ city and what might be driving the numbers, check out our prior pieces here and here)
- Midwest and Great Plains also showed strength, but their relatively low volumes couldn’t make up for significant declines in Pacific/Hawaii and NY/NJ
- Pacific/Hawaii in particular is struggling, as volume has dropped 44% since December
- Of all 82 metros we track, just 2 show positive volume growth year to date vs. last year: Houston and New Orleans. We’ve talked about the relative strength in Texas before, and perhaps New Orleans is simply doing its best to welcome all of us to town for NRMLA’s annual convention later this year…
The story is similarly stark (and no that’s not an Iron Man 2 reference, even though we are excited to see the movie next week) among lenders, as you might expect given the broad industry decline in recent months. On a year to date basis, only 2 of the top 10 lenders show positive volume growth:
- Urban Financial (recently purchased by Knight Capital) saw retail volume grow 48%, perhaps benefiting from relative strength in the Midwest where they’re based, despite their top volume state continuing to be Florida
- Genworth is seeing positive trends in their retail business, up 41% vs. 2009
The full report is available by clicking the image below. Enjoy!
There’s a new sheriff in town, and that sheriff is Generation Mortgage. Ok, that may be a little extreme, but on an endorsement volume basis we saw Generation take the lead on the wholesale side of the business in February, with 831 loans endorsed during the month. This is a major improvement over where they were in the second half of 2009, where they were a little late in getting a competitive fixed rate product to market. With over 70% of the reverse mortgage business being fixed rate product in the latter portion of the year, not having it proved costly. However, it appears they have fixed that, and in a big way. However, before we anoint them as the new kings of the wholesale biz, it’s worth a wait of a few months to see if the performance is consistently good, or if there was some catching up in endorsements from prior periods.
Genworth also gained in February with a more attractive fixed rate product offering to underline the point, although they saw less pickup than Generation. Rounding out the trio of higher performers this month is Urban, recently bought by Knight Capital Group. Their wholesale volume of 653 units put them in 3rd place for the month, behind Generation and Bank of America.
What are some other trends to point out for February?
- Wholesale endorsement volume dropped 12.6%, vs a 1.5% decline in Direct Endorsements. One month does not a trend make, particularly since this still leaves broker/wholesale activity considerably above direct retail lending given the better figures in Dec & Jan, although we’ll continue to watch closely for signs of a trend given that the current environment seems tilted toward direct retail lenders right now.
- Another way to look at whether big lenders are faring better than small is the combined market share of top 10 lenders. On that score, we’re getting early indications that the big are getting bigger as a full 92.5% of all volume in February went through either retail or wholesale channels at the top 10. That may not surprise anyone who has been in the business a while, but it underlines the point that smaller volumes point to more concentration as smaller players exit the business.
- February proved a volatile month for lenders’ combined endorsement volumes, with 7 of the top 9 lenders (excluding WAF) having moves of 30% or more up/down.
- Wells Fargo and Bank of America saw relatively steady volumes, up 11% and down 12% respectively
- Generation, Urban and Genworth were the winners as outlined above, each up 36-88%
- The remaining lenders saw declines ranging from 40-47%
Be sure to click the link below to access the full report:
HUD published the monthly endorsement numbers on Thursday, and we are finally really starting to see the effects of the lower level of application on endorsement volume. Overall industry numbers for March came in at 5,822 units, down 17% from February. For the first quarter, overall volume fell 32% versus Q1-09.
No region was spared, with the “best” performance belonging to New York/New Jersey, down 22.7% through the first three months of the year. Following closely on its heels is the Mid-Atlantic region, posting a 23.6% decline. The Southeast holds the honor as the worst performing area, dropping 38.8% thus far.
As always, though, there are pockets of strength, especially when we look at the data with more granularity. Houston, TX has posted a gain of 12+%. The Bay Area of San Francisco is only 5% off the pace from last year after a very strong 2009 performance. The Baltimore area, highlighted a few weeks ago, is down a little over 7%. What’s disconcerting about this though, is that of all the HOC’s, just two are positive vs the prior year (the other being Shreveport).
Despite the industry’s weakness, some companies are still managing to do well and increase their market share:
- Urban Financial is the #4 retail lender, with volume up 55% vs 2009 (Congratulations on their recent acquisition announcement!)
- 1st AAA Reverse is up 42%
- Genworth Financial’s volume grew 104%
- New Day Financial, with no volume endorsed in 2009, is up to the #10 spot on the list
- There are many more, just look at the list of the Top 100 lenders on page 5
The full report is available by clicking the image below. Enjoy!
