I Consumer Financial Protection Bureau (CFPB) in December released its 2023 Mortgage Market Activity and Trends report, which includes a brief look at activity from the mortgage industry based on Home Mortgage Disclosure Act (HMDA) data through 2023.
While most of the data excluded reverse mortgages from the broader housing market trend, the report did include a section dedicated to the origination of Home Equity Conversion Mortgages (HECMs). This category did not deal with proprietary, independent reverse mortgages, which is the norm in the industry despite the continued dominance of the HECM product.
“HMDA data is used to help determine whether financial institutions are meeting the housing loan needs of their local communities; facilitating the distribution of public sector funds to local communities to attract private investors; and to help identify discriminatory lending practices and enforce anti-discrimination laws,” the report explains.
The report also details the common fact that the industry’s top 10 lenders account for the majority of reverse mortgage loans from the US.
“In total, the top 10 reverse lenders accounted for 22,000 foreclosure originations, or approximately 88.6%, of all foreclosure originations reported under HMDA in 2023,” the report noted.
The levels are very similar to those observed by Reverse Market Insight (RMI) in early 2024, although there are expected variations in the total volumes of the initiation given the reporting requirements and approval data available at that time.
Among the leading lenders, the company is now called American Finance (FOA) – still active as American Finance Reverse (FAR) for the full year 2023 – was the largest reverse mortgage lender that reported HMDA data for 2023. It accounted for approximately 30.6% of all reverse mortgage originations reported under the guidelines.
But this includes developments that may have started under the previous industry leader American Advisors Group (AAG), acquired by FOA in 2023. Last year, the company announced that both FAR and AAG – which had been operating as a direct-to-consumer lender division after the deal closed – would become one under the FOA. a symbol.
Mutual of Omaha Mortgage was number 2 behind FAR with a market share of 22.5%, followed by Longbridge Financial share price by 12.8%. A year later, Mutual of Omaha will surpass FOA/FAR on the leaderboard to become the leading HECM lender in the space, according to approval data from RMI.
The report noted that unlike the foreclosure industry, “applicant income values for reverse mortgages in HMDA data are generally ‘not applicable’ and we exclude ‘borrower mortgage insurance'” borrower data from the loan origination table in the report. .
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