UWM CEO Mat Ishbia joins Yahoo Finance to discuss United Wholesale Mortgage’s pursuit of growth in its industry and how the company’s adoption of bitcoin for mortgage payments could benefit them in the long term.
JULIE HYMAN: United Hotel Mortgage reported earnings a couple of days ago. The stock fell yesterday. He’s bouncing a little this morning. Let’s take a closer look at the numbers as well as the company’s prospects. Mat Ishbia is with us. He is the CEO of UWM. Mat, good to see you again. I want to talk … I want to talk about this right now and talk to you about the fields. Because there really was such a war between you and your competitors for brokers, for mortgage brokers.
You have been very successful in supporting your major mortgage brokers. But it’s expensive. So at what point does this price get too high? The street may have thought it was too much in the last block. How do you watch it?
MAT ISHBIA: Yeah, thanks for inviting me. Not at all, in my opinion, this is not a problem at all. People look at the fields wrong. They just don’t understand how we work and how we do it. So, UWM is in growth mode. We have grown. We were constantly growing. We also pay dividends. We make tons of money. If you take our main profit, more than 350 million in the second quarter, that’s a lot of money.
We pay everyone a big dividend every quarter. We make a lot of money. Because our technology is better than others, so our creation costs are lower. This is part of the strategy. The strategy is to lower your margin. Since I control the margin, I personally control the margin every day. I lowered my margins in order to grow our business, attract more clients to us, help our clients grow their business in comparison with retail competitors.
And it helps the broker’s channel to grow. As this pie gets bigger, UWM continues to grow. We have significantly closed the gap with the number one lender. And at the same time, everyone else we compete with fell in the second quarter. We got up. We are growing. And this is all part of the strategy. It’s very controllable, very understandable. And it actually works better than expected.
BRIAN SOZZY: Matt, we’re getting poor feedback on the housing market. We received some more weak feedback this morning. Will your margin grow by the end of this year despite these numbers?
MAT ISHBIA: Our business will grow, that’s for sure. And our fields, I think, I was guided by basically about the same ranges. But I think they will be slightly higher than last quarter. But in reality, this is all part of the strategy. And so many purchases. In the second quarter, we made $ 24 billion in purchases, far more than anyone else. So watch what happens when the rates increase even more.
So the market will slow down a bit? I know, you know, home sales and other things, maybe you think this will cool off. We think there will be many opportunities. The third and fourth quarters will be the best second half in UWM history. In the 21st year we have more business than in the 20th. And so we are delighted with it. I don’t think the housing market is going to change for the better because of what we are doing here at UWM with our partnerships with our brokers.
BRIAN SOZZY: Looking at the stocks, Mat, they were under pressure, and I believe they have halved since the end of December. You have now seriously discussed the issue of profit and loss about how you can count on rewarding shareholders in the future. You said you were looking for creative ways. Can you spread them out for us?
MAT ISHBIA: Yes, what are we looking at, how do we help our clients? How do we help our clients? How do I take care of my team members and my shareholders? So all four people are sitting at the table. We take care of everyone. So, we have authorized the buyback of up to 300 million shares. I am obviously deliberately about the float. Because I have a lot of shareholders who want us to have more shares so that some big organizations can come in.
Therefore, we buy more at these prices. These prices are very low and clearly pay big dividends. And so we do a lot of different things. But we have big technologies, big things. I said that we are issuing cryptocurrency. I talked about some of the things we are doing to help FindAMortgageBroker.com help more consumers learn how to get a loan.
We have some big technologies coming in the third quarter that hopefully will not only contribute to our best quarter of all time, which I think we have a good chance to do in terms of volumes, but also really catapult us into second half. year and understanding how we can continue to grow and succeed in the eyes of shareholders by doing things like returning capital, be it dividends, buybacks, or other ideas.
JULIE HYMAN: So Mat, let’s move on to cryptocurrency for a moment, the cryptocurrency headline. I mean, we’ve recently seen companies like AMC say they will accept crypto, and I think it’s safe to say that our team here read this as a way to get the headlines. Is anyone really going to use cryptocurrency to buy a home? Do you want this cryptocurrency on your balance? Would like to talk to me about the mechanics of this.
MAT ISHBIA: Yeah. So thanks. Yes, I definitely don’t need extra headings. I think you guys are doing a great job talking about us, our business and what we do as we are the second mortgage company in America. But the reality is that we are the leader. We are an innovator. We are the best technology company in the mortgage base by a wide margin. So, you know, everyone loves doing what they’ve always done.
At UWM, we think about what is the best way? People don’t buy cryptocurrency using cryptocurrency to buy a house. We’re saying can you make the mortgage payment? Almost a million consumers pay UWM every month. So hey, we have a lot of consumers who have a lot of cryptocurrency. They would like to be able to convey this. How do we do it? So we said: hey listen, we’re digging deep. We are always a leader. I’m not going to sit here and wait for everyone to do this and then follow.
We are leaders. We have 1200 technicians. We have the best innovation team in the country. And we will continue to be the leader. So, cryptocurrency is just one example. I am looking at NFT. We do something with bots. We do a lot of things in technology that people just don’t understand because they think mortgages are old and sleepy. This is not what UWM has. We are not like that. And mortgage brokers too.
JULIE HYMAN: WELL. So Mat, let me ask you, if people pay, are they going to end up paying off the cryptocurrency mortgage, you keep … you end up clinging to that cryptocurrency on your balance sheet? Do you want cryptocurrency on your balance sheet? How will it work?
MAT ISHBIA: Yes, so we look at it all. But actually, probably not. We are not going to invest in cryptocurrency. We strive to provide access to our clients. And so we converted it into cash and figured out how to do it in the most appropriate way at the time. And so we are not going to change our business. Our business is to dominate the mortgage lending industry. Let’s grow. Let’s lower margins, help mortgage brokers grow and all.
But we also need to remember a million people, you know, many of these people would like to pay with cryptocurrency, would not want to convert themselves. We can do something for them and say … So, I said, we’re digging. We are delving into many technologies and are going to keep innovating.
JULIE HYMAN: Well, we look forward to meeting you soon, finding out how many people are doing this, and getting more information on those other creative solutions you’re talking about, Mat. Nice catching up, Mat Ishbia from UWM.