America’s Moneyline, the high-volume California-based brokerage, is firing back at the nation’s leading wholesale lender, United Wholesale Mortgage, with a countersuit after the lender attempted to sue it for violating the “All-In” Initiative UWM established in March 2021.
It’s unknown whether UWM CEO Mat Ishbia expected this backlash when first issuing the ultimatum, but now the wholesale lender is facing multiple lawsuits — some of which they play the offense in and others defense. Similar to the suit filed against Moneyline, UWM is going after two more broker partners — also based in California — for violating the “All-In” Initiative.
UWM filed suit against America’s Moneyline (AML) earlier this month claiming that since signing the “All-In” addendum, AML has submitted 560 loans to Rocket and Fairway. Yet, AML CEO Shawn Nevin, in a statement, called the ultimatum as “anti-competitive” and “anti-American,” saying it won’t survive judicial scrutiny.
The heated statement from Nevin and his attorneys makes damning claims against the Pontiac-based wholesale lender while explaining his intentions behind the countersuit.
“Earlier this month, Mat Ishbia and his henchmen at UWM filed a lawsuit against my company for what they deemed violations of their ridiculous ‘ultimatum,’” the statement reads. “They were all too eager to share the details of their suit with the media in some bizarre victory lap.”
“Today, we are fighting back,” Nevin continues. “Our company has filed suit in federal court challenging the legality of the ultimatum, while also calling out illegal business practices by UWM’s leadership. Time and again we were assured they would not enforce their loyalty pact if we just signed it. After freezing more than 100 of our loans in their pipeline — harming our clients — we were forced to sign, again with assurances we would be able to use any lender we wanted. That turned out to be just the latest lie from Mat and his team.”
Also included in the email is a direct statement from Nevin:
“Mat Ishbia’s ‘ultimatum’ is a blatant and desperate attempt to maintain his company’s grip on the throat of mortgage brokers across the country. As he works tirelessly to craft a false narrative around being the champion of brokers, his actions tell a completely different story. The fundamental purpose of being an independent broker is to have as many choices and options as possible to provide to your clients with the very best rate and loan program.”
He continues, “UWM’s ultimatum restricts our ability to do this, which ultimately causes the client harm. UWM is not our answer for all loans. Their pricing is often higher than their competitors, plus they refuse to lend to creditworthy Americans with FICO scores below 620. Ishbia’s anti-American ultimatum was purely designed to maintain his market share, not helping the American homeowner.”
“For nearly nine months,” Nevin said, “we have been explicitly clear with the leadership team at UWM that we will not abide by the terms of their ultimatum.”
Nevin added, “I’m standing up for what is right. This is a true David versus Goliath battle.”
A spokesperson for UWM responded to Nevin’s allegations, stating: “We have over 11,000 clients who abide by the contractual terms of doing business with UWM. UWM, like all companies, must comply with the terms and conditions in the contracts we sign. In turn, we hold people accountable for following the terms and conditions outlined in our contract, which America’s Moneyline knowingly and purposefully breached. This is not about UWM’s business model; this is a contract law case.”
The lawsuit saga stemming from last year’s ultimatum does not end there, though. According to the Detroit News, the Pontiac-based mortgage giant sued two of its mortgage brokers this week, both of whom have also continued to do business with Rocket Mortgage after signing the “All-In” addendum, the lawsuit claims.
On Wednesday — as UWM’s share price hit an all-time low — the lender went after its broker partners Kevron Investments Inc. and Mid Valley Funding & Investments Inc., both based in California. The lawsuit alleges that Mid Valley has submitted at least 62 mortgage loans to Rocket since April 2021, when it had already agreed to UWM’s addendum. In return, UWM is demanding at least $310,000 in liquidated damages. Kevron has allegedly submitted 22 loans to Rocket since March 2021, according to UWM, and is requesting an award of $110,000 in return. UWM is also seeking attorney fees and interest.
"All of our current clients are aligned with the 'All In' initiative and what it stands for," UWM said in a statement to the Detroit News. "However, there have been a few brokerages who have breached this agreement. After further investigation into each breach and following a conversation with them, they continued to submit loans to UWM and Rocket Mortgage. Therefore, UWM is moving forward with legal action enforcing the penalties laid out and agreed to in the contract."
