Hello, LOs!
Happy Wednesday! Last week I asked what you all thought about UWM's lawsuit with America's MoneyLine, and I got quite a few responses. I'd like to share some of those with you today.
One LO based in California said he hopes UWM loses the lawsuit and nullifies all of the agreements brokers signed.
I enjoyed sending loans to both UWM and Rocket. Being able to send loans to either lender made them both better. Mortgage brokers are best when they can shop loans wherever they want to. UWM's ultimatum was a terrible move, anti-American, anti-competitive and frankly, made them look weak. Rocket had better pricing, a better platform and better product offerings. The only thing that UWM could beat Rocket on was speed. So they got whiny like a 4 yr old and demanded that people only play with them and not Rocket.
The biggest loser was borrowers. Our competitive advantage over retail lenders is in our power to shop loans, close quickly and offer better rates. When UWM didn't want to compete with Rocket any more, our customers lost out. I don't drink the UWM Kool-Aid like some brokers do. Brokers do better when lenders have to compete for our business. When the broker community as a whole does better, everybody wins.
An LO in the Midwest said he originated loans for a bank that partnered all of its government loans through UWM and "very much enjoyed their process."
I have also been employed directly by Fairway, and it was by far the best broker shop I have worked for. This is an interesting situation! I do not know of any law or right UWM's exclusivity clause violates, although I would think that they would lose partners over it- Why would I want to trap myself to one option that could price their product above market at any point? I do not believe that UWM's brand is so much better that it would necessitate a blind following, and even more; on the surface I would have to ask myself: if they believe that their product is so good, then why do they feel the need to legally tie me to them? Shouldn't their products/ services entice me to utilize them exclusively on their own?
Either way I think America's MoneyLine will have to pay the fine or settle. They should have known what they were doing when they signed the contract and then violated it. It's not illegal for a married person to sleep with someone other than their spouse, but it can certainly serve as reason to break a marriage contract. It will be interesting to see how this one develops.
One West Coast LO mostly expressed disappointment. He liked working with UWM and Rocket.
I would prefer to do business with both. I would prefer to leave it up to the marketplace. I don't like the letter I signed. But I was doing three times the loans with UWM than I was doing with Rocket so it was easy to choose but the ban isn't cool.
And a broker/owner in Hawaii said AML knew there would be consequences to violating the addendum. UWM did no wrong, he said.
America's MoneyLine is picking a losing battle. UWM isn't forcing any broker shop to use them. AML signed a broker agreement they fully didn't intend to make good on. That's on them and I'm glad UWM is pursuing the lawsuit.
We as brokers are free to use or not use specific wholesale lenders.
Wholesale lenders should likewise be able to limit who they do and don't do business with.
Honestly, my thoughts for AML and others who have their position: Put your big boy pants on and quit thinking everyone has to do business the way you want them to.
LOs, please share your thoughts with me by emailing me at jkleimann@housingwire.com. Also, let me know if you'll be in Miami this weekend for the AIME conference. HousingWire Mortgage Reporter Flávia Furlan Nunes will be there and she'd love to get to know y'all a bit better.
James Kleimann
Managing Editor, HousingWire
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