Reverse Mortgage Margins Dip After Recent Changes Force Competition

December 4, 2017


Reverse Mortgages have reportedly continued to dip following the changes that reduced principal limits. Last week we reported on how the change has forced competition but overall, some mortgage professionals are seeing varying margins across the board.


“We’ve seen competitive quotes with margins as low as 1% on the annual HECM," said Bruce Barnes, executive Vice President at Live Well Financial, according to Reverse Mortgage Daily


"However, the average margin for the annual product appears to be trending at or above 2.25%.” 


Meanwhile other professionals like Jerry Wagner, Ibis Software president, predicts that the margins will fall even more than they have and increase the competition amongst lenders even more that its current state. 


Lenders may be taking a hit overall in the long-run due to the "lower yield spread premiums" according to Wagner's assessment of the change. 


To learn more about what the lower margins mean for lenders across the board, click on the image above.









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