January of 2011 has brought back a familiar theme from last year as broker/wholesale endorsements outpaced the retail market in a down month for the industry overall according to the latest reverse mortgage market report from Reverse Market Insight. This pattern has been repeated several times over 2010, particularly as the reverse industry volume growth tapered off in September and October according to the Reverse Market Insight Report.
Broker/wholesale endorsements for January came in at 2,413 units, up 9.3 percent from December of 2010's totals, but down 45.8 percent from just one year ago. Retail endorsements totaled 4,049 units, down 6.8 percent from last month, but up 27.7 percent from the same time last year. Brokers contributed 37.3 percent of all units, up from the count of 33.7 percent last month, but down from 58.4 percent just one year ago.
The divergence between channels is viewed as particularly striking because the retail was entirely responsible for the industry decline. It’s way too early to attribute the weakness to the exit of Bank of America (we won’t see that effect until at least March or more likely April endorsements), so we can probably expect some bounce-back from Retail in February results if our client conversations are any indication.
Bank of America closed down their reverse mortgage division entirely, and showed a 17.8 percent market share (including wholesale and retail). As you read here, Wells Fargo closed their reverse mortgage wholesale program, which we suspect was a result of their low wholesale market share at four percent considering that one out of every four reverse mortgages are done via Wells according to the report.
There was a wide divergence among other top 10 lenders in January, as Genworth Mortgage and Urban Financial Group both saw strong recoveries from what now look like hiccups in December, while Financial Freedom had the most notable decline to a multi-year low.