Hello, LOs!
Let's say that the MBA's predictions come true: $2.60 trillion in new mortgages are originated in 2022, and the mix is 33% refis and 67% purchases.
It would be a very different market than 2020 and 2021, in which the lenders that really succeeded had the ability to scale up quickly to meet capacity challenges. So who's best positioned to capitalize on a market that more closely resembles 2019 than 2021?
Let's take a look at some purchase origination stats compiled by the good folks at Inside Mortgage Finance.
In 2021, Pennymac notched the highest purchase volume, at $106.3B in 2021, including $23.8 billion in the fourth quarter. Much of that business, however, was through the correspondent channel, so let's look at some other lenders for now.
The next largest purchase originator last year was United Wholesale Mortgage, at $87.26 billion, including $24.5 billion in the fourth quarter. Like virtually all originators, UWM's purchase volume dropped sequentially from the third quarter, down 7.5%. Overall, UWM's purchase mix in 2021 was 45.4%.
Wells Fargo was the third-biggest purchase lender in America in 2021, according to IMF, originating $86 billion in purchase mortgages, including $19.5 billion in Q4, a 17.3% sequential drop. NewRez/Caliber was next in line, with $77.6 billion in purchase volume in 2021, including $19.4 billion in Q4, down 16.2% from the third quarter.
JPMorgan Chase, with $75.1 billion in purchase volume, was the fifth-largest purchase originator in 2021, according to IMF. The depository's purchase volume in Q4, at $20.6 billion, only slipped 5.5% in the fourth quarter from the prior quarter.
Rocket Mortgage originated $56.9 billion in purchase mortgages last year, including $15.17 billion in Q4, down 17.9% from the prior quarter, IMF found. The company's mix of purchase was just 16.2% in 2021, just below Freedom Mortgage at 16.7%.
The numbers suggest Guaranteed Rate is well-placed to take advantage of a purchase environment. The retail lender originated $56.6 billion in purchase mortgages last year, including $13.9 billion in Q4. Its overall mix of purchase mortgages was 49.5% last year.
Others that leaned purchase in 2021 included depository U.S. Bank (53.3%), multichannel lender Fairway Independent Mortgage (61.7%), Movement Mortgage (67.3%), CrossCountry Mortgage (54.6%) and Guild Mortgage (52.8%).
Interestingly, wholesaler Homepoint also managed to increase its purchase originations in Q4 to $7.7 billion from Q3's $7.1 billion, which was rare among originators and might suggest a sign of good things to come.
As for those with the biggest mountains to climb, direct-to-consumer lenders like Better.com and Interfirst, which typically do not have the infrastructure for purchase, are expected to struggle.
We're working on a feature story that will drop next week. But LOs, I'd like to hear from you: who do you think is best positioned to win in a purchase market? And who's staring down the barrel? Email me at jkleimann@housingwire.com.
James Kleimann
Managing Editor, HousingWire
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