United Wholesale Mortgage Lending Business Grows 288%



United Wholesale Mortgage raised a record number of buy loans in the second quarter of 2021 as the refinancing boom continued to subside, helping the company lift its total lending to a new high.

Overall, Pontiac, Michigan-based UWM provided $ 59.2 billion in loans during April, May and June, up 21 percent from the first quarter of the year and 90 percent from last year.

But the growing share of less profitable purchase mortgages was bitten by net income, which was down 74 percent from a year ago to $ 138.7 million.

UWM Mortgages by Type

Source: UWM regulatory data compiled by Inman.

Purchase loans nearly doubled from the first quarter to the second to a record $ 24.1 billion. That’s 288 percent more than a year ago, when the pandemic lowered home sales. Purchase loans accounted for 41 percent of UWM lending volume in the second quarter, up from 22 percent in the last three months of 2020.

At 81 basis points, its overall profit margin was down 67 percent from the 243 basis points the company earned a year ago, when 80 percent of its loans were refinanced. This is what UWM expects profitability to look like in the future, proposing that lending volume in the third quarter should be in the $ 57-62 billion range, with an expected profit margin of 75 to 100 basis points.

UWM CEO Mat Ishbia highlighted the surge in purchase loans, saying the company’s relationship with mortgage brokers will help it stay profitable as mortgage rates rise and refinancing stops.

Mat Ishbia

CEO of United Wholesale Mortgage Mat Ishbia

“As we said earlier, UWM is built to succeed not only when there is a refinancing boom and margins are at an all-time high, but also when margins are shrinking and sales are increasing,” Ishbia said in a statement. statement… “Consumers are increasingly realizing that working with a broker is the cheapest, fastest and easiest way to get a mortgage, and as long as the wholesale channel thrives, UWM will be the undisputed leader and champion of that channel.”

Since it is not a retail lender, UWM is not popular with many consumers. But he was second only to Wells Fargo as purchase loan provider in 2020.

UWM Rivals Rocket mortgage – the country’s largest mortgage lender – and credit also reported record purchase loans in the second quarter.

Email Matt Carter


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