Rocket Mortgage has responded to United Wholesale Mortgage’s new policy blocking business with brokers who also partner with Rocket and Fairway Independent Mortgage Corp.
UWM announced the shift via a Facebook Live session with CEO Mat Ishbia March 4, chastising Rocket and Fairway for business practices he deemed hurtful to the wholesale mortgage channel. Ishbia described the move as asking brokers to “make a decision on whether they are all in on the future of the wholesale channel.”
Rocket, however, decried the policy in a public statement from Executive Vice President Austin Niemiec on Twitter.
“The incredible growth of Rocket Pro TPO, which had a 125% increase in business in 2020, clearly has UWM very concerned,” Niemiec said. “Today’s move decimates the idea of the free and open market that is so critical to the broker community. We continue to advocate for the right of brokers and consumers to choose how they secure home financing. We do not support restricting consumers’ options — whether it is through economic and social pressure or intimidation tactics.”
“As we have said repeatedly, a broker’s power is in their ability to choose the best option for their client. By attempting to manipulate the market and have loan officers swear allegiance, sacrificing control as business owners to one company — with financial penalties if they stray — you harm their ability to compete. This move only benefits one company, to the detriment of thousands in the broker community and their clients.”
Niemiec further emphasized the company’s stance in an email to brokers over the weekend of March 6.
“If you are still deciding whether you will continue working with Rocket Pro TPO or will be bullied into limiting your choices and harming your business, I invite you to think about this in a different way,” Niemiec wrote. “If you feel you have no choice but to sign UWM’s addendum, you will be signing away your freedom and, as a result, your ability to best serve your clients.
“Above all else, being a broker embodies the very concept of freedom. Freedom to be a business owner. Freedom to choose lenders. Freedom to choose programs and pricing. Freedom to do what you think is best for your clients. Giving up that freedom means giving up one of the core tenets of being a mortgage broker. Why would UWM ask mortgage brokers to give up their freedom and their superpower of choice?”
A number of trade groups have weighed in on UWM’s new policy, including the Mortgage Bankers Association (MBA), which panned the company for the move.
“Consumers are best served when they have choices created by a robust, competitive market that offers a multitude of loan prices, products and service levels,” said Bob Broeksmit, president of the Mortgage Bankers Associaton. “Our mortgage market is extraordinarily competitive, with thousands of lenders, multiple delivery channels and varying business models. MBA does not condone activities designed to thwart competition in the mortgage market and limit loan options available to borrowers.”
Kimber White, president of the National Association of Mortgage Brokers (NAMB), also criticized the change.
“We’re not sure this is even legal. It certainly isn’t ethical,” said White. “And it doesn’t represent the American way of free enterprise. This is counter to the spirit of freedom and independence that is the very foundation of our broker businesses. You should be allowed to work with whomever you want, and who offers the best product and customer service, not a company who dictates your business model to you.”
Regardless of the legal implications, Niemiec implored brokers to stand against UWM’s new business practice, reiterating the need for freedom in the marketplace.
“Whether or not UWM’s gambit is ‘legal’ isn’t the point,” he said in his email. “The point is freedom. Freedom can’t be protected by the courts. While courts have the job of enforcing legal rights, freedom is a mindset. Freedom is the ability of an individual to make autonomous decisions — not have them forced upon you. Freedom is a precious thing.”