Data released last week by New View Advisors illustrates the ongoing shift away from federally insured Home Equity Conversion Mortgages (HECMs) and toward proprietary reverse mortgages.
In the newest edition of its Proprietary Reverse Mortgage Production Index, which New View began publishing last year, the company determined that proprietary products accounted for $1.2 billion in volume during the third quarter of 2026. For the first three quarters of this year, private-label reverse mortgages totaled $3.5 billion, up 46% from an estimated $2.4 billion during the same period in 2025.
Proprietary loans have grown in prominence in recent years through new offerings from leading lenders like Mutual of Omaha Mortgage, Finance of America, Longbridge Financial and South River Mortgage.
New View Advisors said that these loans accounted for more than 60% of all reverse mortgage volume in September 2026 — and it expects that share to continue growing.
“Rising interest rates may challenge the reverse mortgage industry in the fourth quarter, but proprietary loans could still propel reverse mortgage industry totals to over $8 billion in 2026, versus $7.3 billion in total new originations of reverse mortgages in 2025,” the company said in its analysis published Oct. 13.
The growth among private products, however, comes at the expense of HECM originations. Based on its analysis of Ginnie Mae first-participation issuance of HECM Mortgage-Backed Securities (HMBS), reverse mortgages insured by the Federal Housing Administration totaled $880 million in Q3 2026 and $2.7 billion through the first nine months of the year.
In comparison, HECM volume reached $3 billion in the first nine months of 2025. But the roughly 10% decline for HECMs on a year-over-year basis was more than offset by the increase in proprietary production. Total reverse mortgage production, measured by dollar volume, was up 14% compared to the first three quarters of last year.
Market dynamics driving the shift
In a higher interest rate environment, borrowers have been incentivized to move toward private-label products and away from HECM products. While higher rates impact all options through lower available proceeds at closing, proprietary loans do not have the same upfront mortgage insurance premium requirement as HECMs.
In a recent webinar, Mutual of Omaha leaders served up examples of how their company’s SecureEquity proprietary product suite has saved some recent deals for borrowers who would have been short to close on a comparable HECM product. They also noted a recent change to SecureEquity qualification requirements, which allows homes valued as low as $300,000 and potentially opens up additional competition against HECMs.
Borrowing costs for reverse mortgages typically run higher than those for traditional forward mortgages, but they respond in similar fashion to monetary policy moves and fluctuations in the 10-year Constant Maturity Treasury (CMT) index.
In his weekly “Ribler on Rates” video series, Dan Ribler, vice president of capital markets and strategy at Longbridge, pointed to a recent slide in the 10-year Treasury yield, which drove a pullback for 30-year mortgage rates. He noted that the roughly 25-basis-point decline in a single day was unusually large for Treasury rates.
“For context on how big of a move that is, in the last five years, there have been two times, two days, where we have seen a 25-basis-point or larger reduction in yield on the 10-year Treasury. … Depending on how you spot this, this is a once every five years or so type of move. It’s a big deal,” Ribler said.
Reverse mortgage professionals should also look to next week’s Federal Reserve meeting, as expectations for a rate pause have been rising recently. The CME Group‘s FedWatch tool on Tuesday showed that 85% of interest rate traders are calling for benchmark rates to stay in their current range of 3.75% to 4%. But nearly 75% are predicting a 25-bps hike in December.
