February 6, 2025

The reverse mortgage market is expected to grow in 2026 as innovation in proprietary products may drive lender activity while traditional Home Equity Conversion Mortgage (“HECM”) originations remain challenged. Growth prospects may be tied to continued product development and efforts by lenders to expand distribution of proprietary reverse mortgage offerings.

HousingWire reported that lenders expect proprietary reverse mortgage products to account for the bulk of growth in 2026 (even as traditional HECM volume remains limited). As Chris Mayer, CEO of Longbridge Financial, stated, “I do think we’re going to see some growth in the HECM space in 2026, but the bulk of it is in proprietary products.” HousingWire also reported that growth in private-label reverse mortgages helped to offset recent market challenges and that this trend is expected to continue, with one executive noting, “We see a lot of innovation and creativity in product development in the proprietary product space.” These market challenges were, in part, associated with challenges related to FHA-insured HECM products (including pricing sensitivity, program constraints, and borrower eligibility considerations).

Looking ahead to 2026, the reporting indicates that growth expectations center on increased borrower awareness and lender outreach, with industry participants emphasizing education, expanded use of existing distribution networks, and product offerings that introduce reverse mortgages and HECMs to new borrowers.