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July 18, 2023

The Stories Industry Data is Telling Now

In regards to the reverse mortgage industry, what does recent data show us and the future market opportunity?

One of the highlights of the National Reverse Mortgage Lenders Associations (NRMLA’s) 2023 Western Conference in Irvine, Calif., was getting to see recent industry data from different sources. The reverse industry does a stellar job of tracking loan & volume information that provide real insight to industry participants.

There were a few interesting stories in the most recent industry data. I’ll share them with you in this post.

Industry consolidation changes the leader board

The acquisition of American Advisors Group (AAG) by Finance of America Companies (FOA) was announced last December and consummated in April this year and it has fundamentally changed the list of top reverse mortgage lenders. Other notable changes towards the top of the leader board are due to big gains by Mutual Of Omaha Reverse, Longbridge Financial, Fairway Independent Mortgage, and a few others.

We also saw leadership moves by Cardinal Financial, Open Mortgage, American Financial Network, Guild Mortgage, Guaranteed Rate and others  who are repositioning themselves and reinvesting in the reverse mortgage space which injected the 2023 NRMLA Western Conference with cautiously-optimistic energy and momentum.

That’s one of the things I’ve noticed during my tenure in this industry. Reverse mortgage professionals don’t always leave this industry as much as they get re-seated and reoriented. Companies that recruit well succeed and the proof is in the data.

Insurance company moving into the industry rapidly

Another very interesting story in the industry data is the rise of Mutual of Omaha. The well-known insurance company has moved up in the list and is currently originating approximately 500 reverse mortgages each month. Year-over-year, the company has grown its reverse mortgage production by more than 100%.

The company has been growing and rising in the ranks for some time and this most recent boost could be due to the fact that the firm has been recruiting reverse mortgage professionals quite aggressively of late.

Of course, this isn’t the only reverse mortgage lender who has seen tremendous growth year-over-year. At least 3 in the top 10 enjoyed it as well.

Reverse mortgage production geographically focused

Another interesting data point that came to light during the conference was that, at least for the industry’s largest players, production is quite geographically focused which wasn’t a surprise but rather a reaffirmation.

According to the data, the industry’s largest reverse mortgage lenders are seeing the bulk of their business coming fromthe Pacific region, the Southeast Region, and the Southwest Region in that order – in some cases, lenders see most of their reverse mortgage origination volume coming from one state, like California ---to the tune of 90%! States in those regions still have tons of home equity which makes a reverse mortgage an attractive option for those wanting to borrow it while reducing their monthly cash-flow needs.

The reverse mortgage market opportunity is a growing trend in the financial industry that offers significant potential for both borrowers and lenders. Reverse mortgages allow homeowners over the age of 55 to convert a portion of their home equity into cash without having to sell their homes and without required monthly mortgage payments. A study by the U.S. Census Bureau projects that the number of Americans over the age of 65 will reach 86.7 million by 2050, highlighting the potential for continued growth in the reverse mortgage market.

Did you know that the Mortgage Cadence Platform serves some of the largest reverse mortgage lenders in the industry? That’s right, with more than 15 years of experience in Reverse Mortgage and a flexible system to support all reverse products, we’ve built a comprehensive library of documents, best practices and processes that allow our customers to create lifelong customers and diversify their products and channels to increase business in complex markets.

George Morales, Reverse Mortgage Product Manager at Mortgage Cadence 

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