Below you’ll find the Wholesale Leaders report with data updated through November 2009.
Wholesale volume dropped almost 17% from October, to 3,901 endorsements. This brings the YTD wholesale volume to 54,609 units, a 6.4% decline from 2008 levels, but we’ll still end the year with the second highest wholesale volume on record. Unfortunately, if the current application trends continue into 2010, there is a decent chance that wholesale volume could slip back to the levels of 2006 (which would mean wholesale volume around 40,000 units). Of course this is not something we all want to hear, but if you are not at least considering this possibility in your plans for 2010 and ready to take the appropriate actions, you may be in for a surprise, and not the pleasant kind.
As a wholesale lender, one way to buffer the potential drop in volume in the next year is to focus on your existing customers and do what you can to win more of their business. If you look at the table at the bottom of page 2, Wells Fargo is currently doing the best job of that (currently capturing 40% of their brokers’ volume), followed by Financial Freedom and Bank of America at 35%. Of course, that only tells part of the story, and the volume Wells does on the wholesale side should indicate that most of their clients are in the smaller volume group – Metlife, Bank of America, and Generation all have fewer customers with a lower capture rate, but do far larger amounts of volume in the wholesale market.
As a vendor to the reverse mortgage industry, the challenges and the opportunities are very similar to those the wholesale lenders face. Understanding which lenders you are missing out on and where they are doing business are both key to growing your market share. If a decline in volume is in the cards, the only way to keep above water is to win more business, both from your current customers as well as those you are completely missing. We have tools available to help you do just that – don’t hesitate to contact us if you want to learn more.
Click here or on the graphic below for this month’s report.