In case you missed it, here’s what happened in reverse mortgage news this week.

SunTrust announced it was closing its reverse mortgage operations. The $172.2 billion national bank closed 419 reverse mortgage loans to date in fiscal year 2011, and had hired reverse mortgage employees from Wells Fargo and Bank of America.

JG Wentworth group officially launched its reverse mortgage program. The new division will operate under Peachtree Financial Solutions. It announced it was getting into the business late last year and it has since been running a small “pilot operation” out of its Randor, Penn. office. Peachtree and J.G. Wentworth became part of JGWPT, a newly formed and privately held holding company earlier this year.

Bank of America said it would sell or unwind its correspondent mortgage channel. In yet another headline for the troubled bank, a spokesman told Bloomberg News: “We intend to sell the correspondent-mortgage lending division or, if a suitable deal is not identified, we will consider other options,”

NRMLA appointed a special financial assessment task force. The National Reverse Mortgage Lenders Association appointed a seven-member committee to review the latest draft of the industry financial assessment that would be used to assess whether borrowers can meet the tax and insurance payments on their loans.

HUD said non-borrowing spouses must receive HECM counseling.Changes to HECM counseling protocol were announced by the Department of Housing and Urban Development, which now requires that all owners shown on the property deed as well as any non-borrowing spouse must personally receive counseling.

RMD wishes you a happy Labor Day long weekend!

Written by Elizabeth Ecker

HECM endorsements rose 5.4% in August to 5,807 loans, Reverse Market Insight reported this week. Still down year-over-year and awaiting what RMI predicts will be some fallout following Wells Fargo’s departure from the business in June, RMI points to the “bright side,” namely that volume was up in nine of the ten regions it tracks.

This, RMI reports, indicates a relatively broad-based rise. Regionally, the Mid-Atlantic saw a 13.4% increase and New England saw nearly as much growth at 13.3%. Year-to-date, the Rocky Mountain, Southwest and Great Plains regions are experiencing growth near 10%.

Competition growth in August also saw an increase, of 7.6%, with 19 new active lenders.

View the RMI report.

Written by Elizabeth Ecker

SunTrust Banks, Inc. (NYSE:STI) will discontinue its reverse mortgage product offerings today, September 1, the company has confirmed. The $172.2 billion national bank, which has closed 419 reverse mortgage loans to date in fiscal year 2011, has remained a quiet Top-25 lender in recent years.

The reverse mortgage retailer, which operates 1,661 retail branches located primarily in Florida, Georgia, Maryland, North Carolina, South Carolina, Tennessee, Virginia, and the District of Columbia, confirmed it will no longer accept reverse mortgage applications as of today.

“After careful consideration, we have determined that we will no longer offer reverse mortgages,” a company spokesman told RMD in an email. “Production volume for these types of loans is extremely small compared to our overall mortgage volume, and from a strategic perspective focusing our full resources on more traditional mortgage origination and servicing is the most effective and efficient use of our resources going forward.”

SunTrust said it will continue to process reverse loans in its pipeline, but will not be accepting any new applications.

The exit comes following other bank exits from the business, including Wells Fargo and Bank of America. RMD has been told that SunTrust previously hired originators from those companies after they left the industry.

“We are working with impacted employees to help them in identifying and pursuing other possible opportunities within the company and providing outplacement support,” the spokesman said.

The timing of the decision also coincides with the entry of another large financial services company: JG Wentworth Group, a division of PeachTree solutions, announced this week that it would officially launch a reverse mortgage division, with plans to grow.

Written by Elizabeth Ecker

The Mortgage Bankers Association (MBA) released its Second Quarter 2011 Mortgage Bankers Performance Report this week, which reveals an improvement in production profit, fueled by heavier purchase activity.

Independent mortgage banks and subsidiaries made an average profit of $575 on each loan they originated in the second quarter, an improvement from the first quarter’s $346 per loan, the report shows.

“Contrary to overall MBA industry data in which estimated production volume declined, the average firm in our study of independents and subsidiaries experienced volume growth. The firms in our study were able to more quickly adjust to a purchase-focused mortgage market environment after a significantly refi-heavy fourth quarter of 2010,” said Marina Walsh, MBA’s Associate Vice President of Industry Analysis, in a statement. “At the same time, secondary marketing gains improved as spreads between ten-year Treasuries and 30-year mortgage rates began to widen towards the end of the second quarter.”

Average production volume for the quarter rose to $174 million per company, up 6% from the first quarter’s $164 million, with the MBA estimate for overall quarterly industry origination volume at $290 billion for the second quarter, less than the $302 billion estimate for the first quarter.

At the same time, total production operating expenses, which include commissions, compensation, occupancy and equipment and other production expenses and corporate allocations, dropped to $5,644 per loan in the second quarter, compared to the previous quarter’s $5,837 per loan.

Average loan balances for the period rose somewhat, to $197,039, slightly more than $196,456 in the first quarter.

Refinancing volume dipped significantly in the second quarter, taking up 36% of the dollar volume of total originations, compared to fully half of the previous quarter’s volume. The MBA estimate for overall industry refinancing share was 62% for the quarter, slightly down from the first quarter’s 65% estimate.

Written by Alyssa Gerace

Generation Mortgage’s Wholesale team recently welcomed Laurel Anderson, previously of Premier Reverse Closings, to its team of Account Executives.

Prior to joining Generation, Anderson worked as an Account Manager for both Premier and E*Trade Financial. With five years of experience in the reverse mortgage industry, Generation calls her a “proven performer” at partnering with her clients to grow their businesses.

“I’m looking forward to working with the Generation Mortgage team, known for their superior customer service, to help build their business and share industry expertise with our partners,” says Anderson.

Anderson, a California native, graduated witha degree in Business Administration from California State University, Fullerton.

Written by Alyssa Gerace

Changing demographic patterns and a rapidly aging population have “major implications” for policy and politics, says a Pew Center on the States infographic. The oldest states, which include Maine, Vermont , West Virginia and New Hampshire may be even more pressed for time when it comes to preparing for long-term care and other challenges that come with the aging baby boom.

To give some magnitude to the aging of the baby boom population, Pew produced a series of “population pyramids” to show exactly how age stacks up state by state, and which states will bear the largest aging burdens as the median age moves away from 30s and into the next decade.

With the U.S. median age just over 37 and the median age in older states such as Maine at nearly 43, the infographic shows each state by the ages and male to female ratio of its residents. The complete breakdown also includes a comparison between the U.S. and several other countries, finding that the U.S. has a high median age and defined baby boom when compared with developing nations such as Afghanistan and Mexico.

View the complete infographic.

Written by Elizabeth Ecker

As smaller lenders look to gain market share following the exits of big banks from the industry, reverse mortgage companies are seeking new originators and other reverse mortgage professionals in wholesale and retail at Reverse Mortgage Jobs Online.

If you have experience in the reverse mortgage industry, or if you are looking for companies that provide leads to originators, check out the list below.

Underwriting

• Underwriter(San Diego) One Reverse Mortgage

Operations

• Servicing operations and management (Lansing, Mich.) Celink

Originators/Marketing

• Reverse Mortgage Originator (Miami) Mortgage Bankers of Florida
• Wholesale Account Executive (Miami) Mortgage Bankers of Florida
• Wholesale Account Executive (Miami, Texas) Mortgage Bankers of Florida
• Loan Officer (San Juan, PR) Generation Mortgage Co.
• Reverse Mortgage Loan Associate (NY, NJ, PA, CT) Residential Home Funding Corp.
• Reverse Mortgage Telemarketers (Melville, N.Y.) Senior Financial Freedom
• Reverse Loan Officer and Processor – Reverse Mortgage (Atlanta and Surrounding States)Retire Secure
• Reverse Loan Agent (Irvine, Calif.) Greenlight Financial
• Loan Officer – Leads provided (Nationwide) 1st AA reverse mortgage
• Reverse Mortgage Professionals – Leads Provided (California) American Advisors Group
• Reverse Mortgage Originator (MA/CT/RI) Reverse Mortgage of New England
• Regional Manager – Reverse Mortgage (various states) Genworth Financial
• Reverse Mortgage Specialist – Reverse Mortgage (various states) Genworth Financial
• Reverse Mortgage Originator (Garden City, N.Y.) Associated Mortgage Bankers
• Business Development Manager (Boca Raton, Fla.) Service Team LLC
• Reverse Mortgage Professionals (Various) Open Mortgage Home Lending
• Reverse Mortgage Originators (Various) First National Bank

Branch Opportunities

• Branch Opportunities (Various) Security One Lending

Visit our website for additional opportunities in the reverse mortgage industry.

The best and the brightest read RMD. Want them to join your team? Post your jobs to Reverse Mortgage Jobs Online today!

JGWPT announced it’s officially launching a reverse mortgage division under its Peachtree Financial Solutions company.

RMD reported that J.G. Wentworth was getting into the business late last year and it has since been running a small “pilot operation” out of its Randor, PA office. Peachtree and J.G. Wentworth became part of JGWPT, a newly formed and privately held holding company earlier this year.

“We anticipated that there were going to be new market opportunities under a single holding company and today’s announcement of this new division is tangible evidence of that,” said David Miller, CEO.

The new division will be operated out of Peachtree’s Boynton Beach location and managed under Alberto Cairo, who currently serves at Peachtree’s COO.

Both J.G. Wentworth and Peachtree financial purchases structured settlement payments and other special assets. Over the last twenty years, the companies have purchased over $9 billion in future payment obligations and other specialty receivables.

JGWPT said it decided to make the reverse mortgage division an extension of Peachtree’s existing business because it’s a better fit operationally.

“This is a business with excellent potential that we can grow over the coming years in Boynton Beach.  We are moving quickly to capitalize on this opportunity,” said Cairo.

The company added that it’s searching for a national sales director.

Changes in Oregon to the state’s senior property tax deferral program have taken a hit to the seniors that formerly qualified, including 24% who have reverse mortgages and can no longer enroll in the program for that reason, according to the Department of Revenue.

The changes to the tax deferral program, which previously had 10,500 participants, included a new stipulation that seniors with reverse mortgages can no longer qualify. Oregon is one of just two remaining states that offered such tax deferrals.

“Perhaps the biggest change for many people is that properties with reverse mortgages would no longer qualify,” an Oregonian report wrote this week, citing data from the Department of Revenue that showed only 7,200 applications were received for the next tax year, and that of those applicants, 24% were denied because they have reverse mortgages.

Committees were scheduled to discuss program changes on Friday.

Read the Oregonian report.

Written by Elizabeth Ecker

Driven by continued weakness in the housing market, among other factors, Moody’s Investors Service downgraded the ratings of several bonds backed by private reverse mortgages.

The downgrade actions came from three mortgage deals and were driven primarily based on the loans concentrated in California, where house prices have declined more than 40% since 2006, Moody’s noted. Analysts expect those home prices to decline an additional 5% from current levels until 2012, after which a slow recovery will follow.

The secondary market impact is unlikely to be significant.

“Downgrades are never good, but none of the bonds have had writedowns yet,” Michael McCully, partner at New View Advisors told RMD in an email. “Other rating agencies have previously downgraded these securities, so most of the market impact has probably already occurred.”

The six bonds from three reverse mortgage deals issued by Structured Assets Securitization Corporation (SASCO) from 2005 to 2007 mainly comprise first lien, non-recourse and uninsured reverse mortgages, Moody’s said in a report.

“All of the deals have a lot of overcollateralization,” McCully said. “A number of bonds (mostly mezzanine bonds) have paid off in their entirety. The rating agencies are basically re-calibrating the ratings by testing what happens if home prices fall another 30%.”

Moody’s noted that given the age profile of the borrowers, it expects a large percentage of maturities to take place over the next five years, while the housing market is still very weak. As a result, the ratings service said, cash flows to the bonds are expected to be impacted negatively.

For more information, see here.

Written by Elizabeth Ecker