HECM lenders see subdued numbers to start the year

Early-year data shows a noticeable slowdown in government-backed reverse mortgage endorsement volume, and the rise of proprietary products may be playing a role. 

Endorsements of Federal Housing Administration-backed Home Equity Conversion Mortgages dropped 20.7% between January and February to 1,821 transactions, according to the latest data from Reverse Market Insight. January's total had come in at 2,295, while HECMs ended 2025 with 2,186 endorsements in December. 

On a year-over-year basis, February endorsements of the government liens, which are available to homeowners aged 62 or older, were also 26.6% off 2,481 units posted one year earlier. While February was a short month, a host of business and political factors may be slowing overall activity in 2026, given that the previous two reports also came in "subpar," RMI said. 

"Overall industry weakness continues to remain a concern, and the short shutdown early in the month is another possible reason," the report suggested. "But it also brings to mind a larger issue that non-HECM reverse mortgage loans are nibbling at the edges of HECM volume more directly these days than ever before."

The past 12 months saw the rollout of several proprietary reverse-draw products by some of the industry's leading originators, some of which combined characteristics of home equity lines of credit or offered higher loan limits. Providers also touted perks, such as the lack of mortgage-insurance requirement on their proprietary liens, in differentiating themselves from FHA's offering as a cost savings benefit. 

At the same time, private companies selling home equity investment agreements, sometimes referred to as shared-appreciation contracts, saw interest in their segment continue to grow, with businesses presenting them as an alternative to traditional lending. HEI agreements allow property owners to draw a portion of their available home equity with no payments due until the end of the contract term.  

Detailed data surrounding proprietary product originations is unavailable to the public, though, "so anecdotal accounts and theories are where we remain," RMI said. 

HECM volume by lender

A sign of shifting trends in the reverse mortgage space shows up in lender rankings compared to a few years ago. American Advisors Group, which was acquired by Finance of America in 2023, previously dominated the HECM market by both loan volume and market share. 

Despite the merger between the two companies, Finance of America today ranks second among HECM lenders, as the company turned much of its attention toward marketing its suite of proprietary loans. 

February's HECM leader was Mutual of Omaha Mortgage, which recorded 371 endorsements, followed by FOA at 364. In third was Longbridge Financial at 304 transactions. All three saw activity decline from January.  

Over the past 12 months, the current market leader has endorsed 5,606 HECMs, followed by Finance of America's 4,839. Longbridge's running total was 4,033 endorsements, managing to exceed its volume of one year earlier.

The latest endorsement data comes as research shows that homeowners aged 62 or older sit on a record amount of accrued equity. The National Reverse Mortgage Lenders Association reported a record $14.7 trillion in housing wealth in 2025's third quarter that belonged to the industry's target customers. The amount climbed up 1.9% from the prior record peak of $14.4 trillion three months earlier. 

Endorsements fell across all U.S. regions in the first two months of the year, with the Pacific/Hawaii division ranking at the top with 432 February endorsements. It was followed by Southeast/Caribbean markets and the Southwest at 409 and 195, respectively.

Totals for the three regions in January finished at 550, 520 and 220 units.