Skip to main content

KBRA Offers New Guide to Reverse Mortgages

Phil Hall
Sep 24, 2018
Sales activity for home equity conversion mortgages (HECM) fell during the first five months of the year, according to new data from Reverse Mortgage Insight

Kroll Bond Rating Agency (KBRA) has published “Five Things to Know About Reverse Mortgages,” a free guide designed to explain the nuances of this product sector.
“Because of recent changes which lowered the proceeds level of FHA-Insured HECM reverse mortgages, many originators focused on HECM originations have begun to diversify into jumbo, uninsured, proprietary reverse mortgages,” said KBRA in a press statement. “This trend has been bolstered by demographic changes which have seen an increase in home equity-rich retirees whom have not amassed and/or retained enough liquid assets to age-in-place in their homes. KBRA believes that these factors will give rise, after a period of absence following the financial crisis, to an increase in both private and public securitization of jumbo proprietary reverse mortgages.”
The new guide offers five main considerations related to the reverse mortgages, including product options, borrower credit and capacity issues, how the product fits into residential mortgage-backed securities, negative amortization and the connection between prepayments and interest rates.
“Although fundamentally linked to residential real estate risk, the analysis of reverse mortgages on a loan and securitization level requires analytical considerations that can differ significantly from forward mortgages,” KBRA added.
Sep 24, 2018
More from
Reverse Mortgages Aren't Expanding Into Broader Mortgage Business

The reverse mortgage sector has remained strong accounting for more than 4,000 loans a month, according to Reverse Mortgage Daily, however, growing the business further has been on the back burner.

Jul 28, 2021
FHA Adds COVID-19 Recovery Options For Forward And Reverse Borrowers

The Federal Housing Administration announced additional COVID-19 recovery options to help both forward and reverse homeowners who are facing hardships as a result of the pandemic.

Jul 26, 2021
RMF Revamps Its Borrower Qualification Process To Increase Efficiency

Reverse Mortgage Funding, LLC (RMF) is taking a new approach to the borrower qualification process for those seeking a reverse mortgage. The process was created to drive efficiency during the approval process and increase reverse mortgage market growth.

Jul 20, 2021
Reverse Mortgage Endorsements Slide By More Than 4 Percent In June

Reverse mortgage endorsements decline by 4.4% to 4,160 loans, increasing the streak of more than 4,000 loans per month, according to Reverse Mortgage Daily.

Jul 06, 2021
Liberty Reverse Mortgage Becomes Full Service Reverse Lender Following RMS Acquisition

Last week Ocwen Financial Services announced the acquisition of Reverse Mortgage Solutions. In a recent interview with Reverse Mortgage Daily, Mike Kent shared how the acquisition will affect the company.

Jun 22, 2021
Ocwen Financial To Acquire Reverse Mortgage Servicing Platform

Ocwen Financial Corporation's wholly-owned subsidiary, PHH Mortgage Corporation will acquire RMS' reverse mortgage servicing platform.

Industry News
Jun 18, 2021