Retail Leaders – September 2009

Sometimes it seems that the more things change, the more things stay the same.  Despite tremendous changes underneath the surface this year (lending limits increased, HECM for purchase authorized, principal limit reductions, etc.) the top line in the reverse mortgage business is in a dead heat with last year’s results.  As of September, 2009 volume of 87,130 is just 0.4% lower (393 loans) than 2008 at the same point.  For those of you keeping score, the next three months need to be as good or better than September to avoid showing a negative growth rate for the year.

Of course, for those of you that just can’t adjust from the federal fiscal year to our unorthodox calendar year approach, your year is already over and we finished up 2.3% from fiscal 2008.

A few highlights of the report this month:

  • Volume in September was up 6% from August, in lock step with last year’s similar increase in the same months.  For a good sense of seasonality (or lack thereof) in the reverse mortgage business, check out the Endorsement Volume chart toward the middle of page 2.
  • Endorsements per lender improved after falling off a cliff last month but remains below all other months in 2009.  Good news is that both Active Lenders and New Lenders ticked down, with New Lenders continuing its downtrend since peaking in March 2008.  We haven’t seen a meaningful increase in Active Lenders (by month) since early 2008, so the declining level of New Lenders should eventually stop replacing the companies exiting the business and start declining on an overall basis.  Remember, 1/2 of the new lenders exit the business within 6 months of their first loan.
  • Industry concentration increased in September for the first time since April, as the top 10 lenders collectively originated 40% of all loans last month
  • Security One and OmniHome are combined in the report and jump back into the top 10 on the strength of that combination, coming in at 9th for the trailing twelve months

Click the report for full details.

Retail Leaders Report