Home Point Capital Posts $73M 2Q Loss

Home Point Capital Inc., parent of Home Point Financial Corp., today posted a net loss of $73 million in the second quarter of 2021, a dramatic turn from the $149 million profit it reported in the first quarter of the year.

In posting the disappointing second-quarter results, Home Point President and CEO Willie Newman said the company was “confronted with a challenging operating environment caused by significant competitive pressure and volatility in the capital markets.”

The second quarter loss also was a significant reversal from the second quarter of 2020, when the company posted a $169 million profit.

Other key points from the earnings release:

• Quarterly funded origination volume more than doubled to $25 billion, compared to $12 billion in the second quarter of 2020 and $29 billion in the first quarter of 2021.
• Total revenue, net of $84 million, compared to $345 million in the prior-year quarter and $422 million in the first quarter of 2021. Revenue for the second quarter of 2021 was adversely affected by significant competitive pressure, and agency pricing and product actions, the company said.
• The company said the net loss in the second quarter was primarily due to lower origination-segment revenue as a result of competitive pressure, agency pricing and product actions, and a $29 million reduction in the mark-to-market fair value, net of hedge, of the mortgage servicing rights portfolio.

Despite the loss, Newman said Home Point “exited the second quarter as a stronger company that is better positioned to build sustainable long-term value for our stakeholders, and we have already begun to see the benefits of our focus and acceleration.”

To read the full earnings release, click here.