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UWM Now Dominating The Mortgage Market

Katie Jensen
Mar 01, 2023

Company leads in origination volume for 2nd straight quarter, claimed 54% of wholesale channel in Q4 2022.

  • Reported a fourth-quarter net loss of $62.5 million, but a year-end profit of nearly $1 billion.
  • For the fourth quarter of 2022, UWM’s total originations amounted to $25.1 billion.

United Wholesale Mortgage (UWM) has done it again, leading the industry in total loan origination volume for the second consecutive quarter.

In addition, and much to UWM Chairman & CEO Mat Ishbia’s delight, the company also claimed an eye-popping 54% share of the wholesale channel in the fourth quarter of 2022, up from 41% in the previous quarter, and an 11% share of the overall mortgage market.

The wholesale channel share is “an all-time market share record,” Ishbia gloated during a webcast with analysts about the company’s fourth-quarter and year-end earnings for 2022. He credited it in part to the company’s Game On pricing strategy announced in June 2022.

“I never expected market share to get there,” Ishbia said, adding that his target had been 40%. “Will it stay at 54%? I doubt it, but it will be higher than before” Game On.

For the fourth quarter of 2022, UWM’s total originations amounted to $25.1 billion, including $21.7 billion in purchase volume, as of Dec. 31. 

UWM has reigned as the largest wholesale mortgage lender in the U.S. by closed loan volume for eight years in a row, with approximately a 38% market share of the wholesale channel for the full year ended Dec. 31. It achieved an 8% share of the overall mortgage market in 2022.

UWM’s net income for all of 2022 was $931.9 million, or 45 cents per diluted share. The company, however, reported a net loss in the fourth quarter of $62.5 million, or 3 cents per diluted share, which included a $150.8 million decline in fair value of mortgage servicing rights (MSR).

Although UWM originated an impressive number of loans in the quarter, the dollar volume was still below both the $33.5 billion in the third quarter and $55.2 billion in the fourth quarter of 2021. Purchase originations also were on a downward trend, with the company reporting $27.7 billion in the fourth quarter and $24.5 billion a year earlier. The trend mirrors the rest of the industry, given recent housing market conditions. 

For the full year, UWM’s originations totaled $127.3 billion, down 43.8% from $226.5 billion in 2021, even though purchase origination achieved a record of $90.8 billion in 2022, up 4% from $87.3 billion in 2021.

Total gain on margin steadily dropped to 51 basis points (bps) in the fourth quarter, compared to 52 bps in previous quarter and 80 bps in fourth quarter of last year. Total gain margin of 77 bps in 2022 was much lower than the 114 bps reported in 2021.

Total equity hit roughly the same figure as it did the previous year, at $3.2 billion, but was still lower than $3.4 billion at the end of the third quarter.

Ishbia touted the company’s net income of $931.9 million, boasting during the earnings webcast that UWM had made “almost $1 billion in profit in a market where most lenders lost money.”

The net income included a $284.1 million increase in fair value of MSR. That compared to net income of $1.6 billion in 2021, with a $587.8 million decline in the fair value of MSR. 

The unpaid principal balance of MSR was $312.5 billion, with a weighted average cost (WAC) of 3.64% as of Dec. 31, 2022, compared to $306 billion with a WAC of 3.44% as of Sept. 30, and $319.8 billion with a WAC of 2.94% as of Dec. 31, 2021.

At the end of the year, UWM had approximately $2.1 billion in available liquidity, including $886.2 million in cash and self-warehouse, and $1.25 billion of available borrowing capacity, which included $750 million under a line of credit secured by agency MSR, and $500 million under an unsecured line of credit. 

Ishbia said 2023 would be another year that “separates the best lenders from the rest,” and made it clear which mortgage company he thought topped the list, declaring, “We are the biggest and best mortgage company in the U.S. and we will continue that.”

Editor David Krechevsky contributed to this report.

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