Reverse Mortgage Volume Drops Significantly In April
May 5, 2020
The COVID-19 pandemic heavily affected reverse mortgage endorsement volume for April 2020, as volume dropped 45% to 1,601 loans during a month, according to Reverse Mortgage Daily. Additionally, industry advisors claim that based on data from the Department of Housing & Urban Development, some lenders posted zero closings in April.
"The decline comes at a time when many originators report borrower inquiries are up and conversations with financial planners and other referral sources are gaining momentum. The loan volume alone is not the only indicator of market health," says Reverse Market Insight co-founder and president John Lunde in his monthly endorsement report published this week. "While we’d normally be very concerned about this level of drop, we have many other reliable indicators that the reverse mortgage business is actually holding up well in the pandemic."
RMI noted that there has been an increase in retail applications for Feburary and in March, and there was a 50% increase in applications year-over-year.
Despite the lull in in April reverse mortgage volume, on yesterday's Mortgage Leadership Outlook series, Ralph Rosynek, chief information officer and senior vice president of wholesale for Moneyhouse, noted how now is a great time to look at reverse mortgages. “We’ve seen a big increase in our pipelines because of this,” Rosynek said due to the impact on retirement savings from drops in the stock market and a lack of a “rainy day plan” by many older workers in light of the COVID-19 outbreak.
Click here to read more about April's reverse mortgage volume.
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