Fairway investing in its reverse mortgage lending business

Fairway Independent Mortgage is investing what it termed "unprecedented resources" in its reverse mortgage business at a time when massive dislocation is taking place in the sector.

The company finished 2022 as the nation's seventh largest originator of Federal Housing Administration Home Equity Conversion Mortgages, with 2,747 endorsements, according to Reverse Market Insight. That was up from 1,688 in 2021.

But the company that by far was the largest HECM originator, American Advisor Group, agreed to be acquired by the fourth most active, Finance of America, in December. Just weeks prior, Reverse Mortgage Finance, which ended the year as the No. 5 lender even after all but shutting down its operations, filed for bankruptcy. AAG also laid off workers, as did No. 8 Open Mortgage.

"Removing silos from the business and leading from the street has helped us become the No. 3 purchase lender in the country and close over $42 billion last year in a challenging market — now we bring that practical approach to reverse in a big way," Len Krupinski, chief operating officer, said in a press release.

As part of the change, Fairway is decentralizing its operations for reverse mortgages, moving away from the "strongly centralized" model it had been using.

Another step is the creation of a Reverse Advisory Council, which is composed of the top leadership from Fairway's sales, operations and support teams.

The company is promising its branches increased regionalized support services for these loans.

"We're ready to serve a new phase of reverse assisting both loan officers and our senior homeowners," said Mike Daryanani, national sales support director. "The changes we're implementing are all about making the experience for reverse borrowers faster and easier." 

Fairway declined to provide additional details about the changes to the reverse mortgage program.

All of Fairway's HECM production is retail and it is the third largest originator in this channel. It is also the leading originator of HECM for purchase mortgages, according to RMI's data.

"Combining experienced reverse mortgage professionals with the excellence of Fairway's retail platform has always been our path towards mainstreaming the reverse mortgage," said Peter Sciandra, vice president of secondary marketing for reverse. "With this infusion of both financial and sweat equity, Fairway has its sights set not only on No. 1 in the industry, but bringing reverse mortgages to an entirely new audience."