The Largest Nonbank Home Purchase Lender in the Nation Is a Wholesaler

September 11, 2018
The Largest Nonbank Home Purchase Lender in the Nation Is a Wholesaler

Everyone wants to be #1 these days. I guess that’s no different than any other days, but the battle to be on top is growing more and more contentious, especially as overall home loan volume wanes.

Rather surprisingly, a nonbank lender that also happens to be a wholesaler took the second spot for home purchase lending in the second quarter of the year.

United Wholesale Mortgage Beat Out Everyone But Wells Fargo

  • The wholesale lender originated $11.2 billion in the second quarter
  • Of which $8.3 billion was home purchase loans
  • Overall loan volume up 68% year-over-year compared to the six-month mark of 2017
  • Highest growth rate among top 25 mortgage lenders in the country

I’m referring to United Wholesale Mortgage, or UWM for short, which issued a press release to celebrate the accomplishment this morning.

It’s the latest in a string of “we’re bigger than you” announcements in the mortgage industry, with a prior notable one being Quicken Loan’s declaration that it was the largest home loan lender in America back in February.

Of course, all of these proclamations come with a little fine print, or perhaps some very specific categorization.

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For example, Quicken was the top mortgage lender in the fourth quarter of 2017, but Wells Fargo was still the top lender for 2017 overall.

And UWM was simply the largest nonbank purchase loan lender in the nation during the second quarter. If we remove the nonbank part from the equation, Wells Fargo was once again king, by far.

Per their own press release, UWM noted that Wells Fargo mustered $15.4 billion in home purchase loans during the quarter, nearly double their $8.3 billion. But Wells Fargo is a depository bank, thus putting it in a different category.

The list continues, with Bank of America managing $7.9 billion, Chase ringing in $7.86 billion, and Quicken Loans rounding out the top five with $7.8 billion.

United Wholesale Mortgage vs. Quicken Loans

  • Both mortgage companies are based out of Michigan
  • UWM is a wholesale mortgage lender that works with brokers
  • Quicken operates both a retail and wholesale lending channel
  • They’ve been taking jabs at one another lately as the rivalry intensifies

For the record, Quicken is the only other nonbank in that short list, with it being clear that UWM is proud to have beaten them.

They even go as far as to mention that they produced $11.2 billion in total loan volume during the second quarter, of which 74% was for new home purchases, compared to just 31.6% of Quicken Loans’ second quarter loan volume.

And highlight the importance of purchase business being “critical” to a mortgage lender’s success these days with mortgage rates on the rise, while bashing call centers and smartphone apps.

In other words, UWM is saying it’s the home purchase loan destination of choice, despite being far less well-known compared with Quicken and its Rocket Loans.

Amazingly, they managed this feat via the wholesale channel alone, which relies upon mortgage brokers to connect with home buyers on its behalf.

Meanwhile, Quicken has both a retail and wholesale channel to originate home loans, though that seems to have been a source of conflict lately.

Much of the drama played out over at HousingWire, which you can check out for yourself. But it basically involves claims that Quicken poaches broker’s wholesale customers via its retail channel, which Quicken later referred to as a smear campaign.

What’s crystal clear is that the battle to be numero uno in the mortgage business is heating up, ostensibly because being #1 is often enough for the consumer to make their choice.

My guess is we’ll see a lot more jostling and back and forth, and perhaps more clever categorizing as these lenders try to claim biggest and best amid a weakening mortgage market that is heavily tilted toward home purchases.

UWM has held the top spot for wholesale mortgage lending overall for more than three years, and currently holds a sizable 20.4% market share, more than triple its closest competitor, Caliber Home Loans, which has just a 6.6% market share.


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