Hecm, Hmbs Activity Falls Sharply In February

Home Equity Conversion Mortgage (HECM) endorsements fell sharply in February, continuing a broader slowdown in the reverse mortgage industry.

The total number of HECMs endorsed during the month dropped 20.7% to 1,821 loans. While February’s shorter calendar often results in fewer endorsements, the size of the decline suggests additional pressures weighed on sales volume, according to commentary from Reverse Market Insight (RMI).

The downturn follows two consecutive months of weaker production, with RMI suggesting that the brief government shutdown early in the month may have contributed to fewer endorsements.

“Overall industry weakness continues to remain a concern, and the short shutdown early in the month is another possible reason, 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,” RMI explained.

Meanwhile, New View Advisors said that February’s endorsement count is the lowest since the early days of the COVID-19 pandemic, when just 1,601 endorsements were recorded in April 2020.

Comprehensive data on the impact of proprietary reverse mortgage products is not publicly available, leaving analysts to rely largely on anecdotal accounts and market observations.

Regionally, no area posted gains in February. The New York/New Jersey region, however, recorded the smallest decline, slipping 1% to 100 loan endorsements. The Midwest followed with a 3.3% decrease to 174 loans. All other regions posted declines of at least 11.4%, with the Northwest/Alaska region falling by 37.4%.

Among the top 10 lenders, all reported lower endorsement totals. Finance of America saw the smallest drop among the group, declining 8.5% to 364 loans. Longbridge Financial followed with a 9% decrease to 304 loans, while the eight other largest lenders posted declines ranging from 15.9% to 49.6%.

HMBS issuance dips

New View Advisors also reported that the issuance of HECM Mortgage-Backed Securities (HMBS) declined in February, falling to $431 million during the month. That’s down $103 million from January’s revised total of $534 million and $39 million lower than the $470 million issued in February 2025.

A total of 66 pools were issued, five fewer than in January.

February’s $431 million total marks the lowest monthly issuance in the past two years, the second lowest since 2014 and the third lowest since 2009, New View reported.

Among issuers, Finance of America led the market with $140 million in February issuance, down $15 million from its $155 million total in January. Longbridge Financial followed with $104 million, a decline of $38 million month over month. Mutual of Omaha Mortgage issued $83 million, down $12 million from January, while PHH Mortgage Corp. issued $66 million, a monthly drop of $23 million.

Original, or first participation, production totaled $260 million in February, down $97 million from January’s $357 million figure and $43 million below the February 2025 figure of $303 million.

Through the first two months of 2026, Finance of America led first participation issuance at $179 million, followed by Longbridge at $165 million, Mutual of Omaha at $120 million and PHH at $85 million.

Of the 66 pools issued in February, 16 were first participation pools, and 48 were tail pools, which consist of subsequent participations rather than new loans. Tail issuance totaled $169 million, compared with $176 million in January.

Twenty-one pools had balances of less than $1 million, reflecting issuer use of Ginnie Mae’s provision that allows pools as small as $250,000. In addition, $49.7 million in participations pooled during the month involved multiple participations from the same loan, a practice permitted under 2023 guidance.

The data was compiled by New View Advisors using publicly available Ginnie Mae data and private sources.