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Mortgage

Rocket Mortgage: UWM is trying to “manipulate” market

Rocket Mortgage responds to UWM’s new broker mandate

Tension between long-time rivals United Wholesale Mortgage and Rocket Pro TPO, formerly Quicken Loans Mortgage Services, reached a new boiling point after the top wholesale lender in the nation announced it will no longer work with brokers who also work with Rocket Mortgage

Mat Ishbia, president and CEO of UWM, gave brokers and owners just over a week to sign an addendum saying they are not working with Rocket Pro TPO. 

And Rocket wasn’t alone in being called out. Ishbia also issued the mandate to anyone who works with Fairway Independent Mortgage Corp.

I’ve had many brokers call me upset, frankly,” Austin Niemiec, Rocket Pro TPO vice president, said in an interview with HousingWire. “I’d say they feel disrespected by one of their partners telling them what they can and cannot do.” 

“Brokers are incredibly smart and savvy mortgage professionals and business owners,” Niemiec added. “They are dialed in to their industry. And we know that we need to provide value, and we need to support them. And if we don’t, it’s their decision and their choice to fire us. But what you’re seeing happen is the complete opposite.” 

In the interview, Niemiec repeatedly emphasized that a broker’s competitive advantage is choice. 

“It is their superpower,” he said. “What UWM is attempting to do is really manipulate the market and have brokers swear allegiance to one company and literally give them financial penalties if they don’t listen to them. That harms their ability to compete, and it harms the consumer. Make no mistake about it, this was a move to benefit one company and one company alone, UWM.”

In the announcement, UWM said that the decision came in response to Rocket Mortgage and Fairway participating in actions including soliciting loan officers away from brokers and working directly with real estate agents to cut brokers out of the entire process, a narrative that is far from new. 

At the end of 2017, Ishbia went on record supporting a fast-growing movement that “focused on stopping the unethical practices used by ‘whole-tail lenders.’” Founded by Anothony Casa, who also founded the Association of Independent Mortgage Experts, the initiative was coined “Brokers Rallying Against Whole-tail Lending,” or BRAWL. “Will the movement cause Quicken Loans or loanDepot to get out of wholesale? Maybe not. But if they get less business, maybe they would stop soliciting to clients,” Ishbia said back in 2017. “We used to always think it’s the wrong thing to do, but that’s just the way it is. These brokers are saying that’s the way it is but we are doing something.”

Rocket Mortgage has made significant changes since Ishbia made that statement over three years ago, including rebranding Quicken Loans Mortgage Services to Rocket Pro TPO. The company, which originated $320 billion in mortgages last year, says it is investing $100 million into the broker channel alone in 2021.

“Three years ago, we had just over 3,000 partners, and now, we have nearly 10,000 partners,” Niemiec said. “Brokers are partnering up with us at a record pace because we’re providing them true value, and we have their back.”

Just days before UWM made this announcement, Rocket Pro TPO  announced a new jumbo mortgage product to draw in self-employed borrowers who have been frustrated by a lack of options outside the conventional realm.

“If a broker will allow one of their partners to tell them what they can and cannot do right now, then who knows what it’ll look like in the future,” Niemiec said. “You whittle away multiple lenders and they tell you who you can and cannot work with, you might as well be a net branch for UWM.”

Niemiec added: “We would never in our wildest dreams, tell a broker to choose us, or someone else. We believe wholeheartedly in competition. We will support brokers and help continue to grow our base by providing them value, not by giving them an ultimatum or telling them what to do.”

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