Business News: UWM states that it will not do business with dealers working with Rocket, Fairway.
In a Facebook Live video today, United Wholesale Mortgage (UWM) President and CEO Mat Ishbia (pictured) said UWM will no longer partner with those brokers who partner with Rocket Mortgage and Fairway Independent Mortgage Corporation.
A press release after the video explained that the move is a response to Rocket and Fairway allegedly participating in actions to urge loan officials to walk away. from brokers and presumably excluding brokers from the process by going directly to real estate agents.
Ishbia accused Quicken Loans LLC’s Rocket Mortgage of incentivising and working directly with real estate agents to bar brokers from the process. He also said that Wisconsin-based Fairway Independent Mortgage Corp. solicits lending agents from broker.
“There are two companies that are subtly attempting to take the lifeblood of mortgage brokers by soliciting loan officers and real estate agents,” Ishbia told The Detroit News Thursday. “We disagree. We have decided that if you want to work with them, we will not help you. Simple.”
Fairway declined to comment. Austin Niemiec, executive vice president of Rocket Rocket Pro TPO’s wholesale brokerage platform, didn’t deny some of UWM’s specific allegations, but said, “Listen, if our goal was to cut the mortgage broker, we wouldn’t be investing tens of millions. dollars into our technology platform, involving brokers and placing them on our website.
UWM undertakes to close any outstanding loans with brokers who do not sign the addendum. Brokers who sign and then proceed to work with Rocket or Fairway must pay “settled damages” to UWM in the greater of $ 5,000 per UWM closed loan or $ 50,000, depending on the language of the addendum. It’s a measure of accountability, Ishbia said.
“We will do what we have always done: provide brokers with real value and I am confident that we will continue to grow,” Niemiec said. “We would never try to control a broker by giving them an ultimatum. This is the broker’s choice. We deliver value. We will compete in the right way “.
The move makes UWM weak, which likely means UWM is losing business, said Erik Gordon, a professor at the University of Michigan’s Ross Business School.
Ishbia has granted brokers until March 15 to sign an addendum saying they don’t work with those lenders. If not, they will no longer be able to work with UWM.
“As of today, at UWM, we are not helping those who help them,” Ishbia said. “If you work and send business to Fairway or Rocket, you can no longer work with UWM immediately.”