Q4 2023 UWM Holdings Corp Earnings Call

Operator: Good morning, my name is Regina, and I will be your conference operator today. At this time, I would like to welcome everyone to the UWM Holdings Corporation fourth quarter 2023 and full year 2023 earnings conference call. All lines have been placed on mute to prevent any background noise.

Good morning, My name is Regina and I will be your conference operator today at this time I would like to welcome everyone to the U W. M Holdings Corporation fourth quarter 2023, and the full year 2023 earnings conference call.

All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. If you would like to ask a question. During this time simply press star followed by the number one on your telephone keypad. If at any time, you would like to remove yourself from the queue. Please re press star one.

Operator: After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star, followed by the number 1 on your telephone keypad. If at any time you would like to remove yourself from the queue, please re-press star 1. Thank you. Blake Kolo, you may begin your conference. Good morning.

Thank you Blake Colo you may begin your conference.

Good morning. This is Blake Colo Chief business Officer, and head of Investor Relations. Thank you for joining us and welcome to the fourth quarter and full year 2023, New Wm Holdings corporations earnings call.

Blake Kolo: This is Blake Kolo, Chief Business Officer and Head of Investor Relations. Thank you for joining us and welcome to the fourth quarter and full year 2023 UWM Holdings Corporation earnings call. Before we start, I would like to remind everyone that this conference call includes forward-looking statements. For more information about factors that may cause actual results to differ materially from forward-looking statements, please refer to the earnings release that we issued this morning. I will now turn the call over to Matt Ishbia, Chairman and CEO of UWM Holdings Corporation, in United Wholesale Morgan. Thanks, Blake. And thank you everyone for joining us today.

Before we start I would like to remind everyone that this conference call includes forward looking statements for more information about factors that may cause actual results to differ materially from forward looking statements. Please refer to the earnings release that we issued this morning.

I will now turn the call over to Matt <unk>, Chairman and CEO of <unk> Holdings Corporation, and United Wholesale mortgage Thanks, Blake and thank you everyone for joining us today.

Matt Ishbia: Let's jump right into a couple thoughts. First off, 2023 was one of the best years in UWM's history. It wasn't the year that stood out from a financial perspective, but it will stand out from a dominance perspective. We separated from our competitors significantly on market share, growth, operational earnings, and strategic investment. It was our second year as the number one overall lender; it was our third consecutive year as the number one purchase lender, and our ninth consecutive year as the number one wholesale lender. As I have said many times before, the best mortgage companies shine in high-rate markets, and that's exactly what we have done consistently here at UWM. While there has been a lot of commentary about higher interest rates on the overall mortgage environment this year, UWM delivered its best purchase of all time with almost $94 billion in purchases, about $20.7 of that being the fourth quarter. We ended the year with over $108 billion of overall production and record market share across.

Let's jump right into a couple of thoughts first off 2023 was one of the best years in UWS history. It wasn't the year that stand out from a financial perspective, but will stand out from a dominance perspective, we separated from our competitors significantly on market share growth operational earnings and strategic investments. It was our second year as the number one overall lender.

Third consecutive year as the number one purchase lender and our ninth consecutive year as the number one wholesale lender as you heard me say many times before the best mortgage Henry Schein and high rate markets and that's exactly what we've done consistently here at U W. M. While there's been a lot of commentary about higher interest rates on the overall mortgage environment. This year you'd have been delivered.

Our best purchase your all time with almost $94 billion of purchase about $20 seven of that being the fourth quarter. We ended the year with over $108 billion of overall production and record market share across the board in short I'm incredibly proud of our team's performance throughout the year and believe this performance is also clear evidence of the strength of the broker channel.

Matt Ishbia: In short, I'm incredibly proud of our team's performance throughout the year and believe this performance is also clear evidence of the strength of the broker channel. UWM and our broker partners have succeeded during times when many have failed, and now we are uniquely positioned to take advantage of the lower rates and increased housing inventory and demand that I believe we will see over the next 6, 12, and 18 months. Before talking about the fourth quarter, I'd like to emphasize a few key messages.

Wm and our broker partners have succeeded during times when many have failed and now we are uniquely positioned to take advantage of the lower rates and increased housing inventory and demand that I believe we will see over the next 612 and 18 months before talking about the fourth quarter I'd like to emphasize a few key messages first and foremost the broker channel is strong and continues to grow its overall share of.

Matt Ishbia: First and foremost, the broker channel is strong and continues to grow its overall share of the industry. Loan Officers continue to join the broker channel, and real estate agents, and consumers continue to see that brokers are the best choice for mortgages. Second, our investment in technology continues to give our brokers a competitive advantage in speed, price, and process. Always making the process faster, easier, and cheaper is our focus. The gap between UWM and our competitors is only getting larger.

The industry loan officers continue joined the broker channel and real estate agents and consumers continue to see that brokers are the best choice for a mortgage second is our investment technology continues to give our brokers our competitive advantage on speed priced and process always making the process faster easier and cheaper as our focus the gap between new Wm and our competitors is only getting larger as before.

Matt Ishbia: It's becoming that much harder to catch up given our relentless effort to continuously improve. Third, I've always stressed that UWM only competes for 2 out of 10 loans. The good news is the Broker Channel keeps growing, and now we're competing for almost 2.5 out of 10 loans. Soon, that will be 3 out of 10 loans and maybe then 4 out of 10 loans.

Summing that much harder to catch up given our relentless effort to continuously improve.

Third I've always stressed that UW only competes for two out of 10 loans. The good news is the broker channel keeps growing and now we are competing for almost two and a half out of 10 loads soon that will be three out of 10 loans and maybe then for 10 loves. This is a tremendous upside of the broker channel and UW M is prepared to make the most of that opportunity in the future.

Matt Ishbia: This is a tremendous upside for the broker channel, and UWM is prepared to make the most of that opportunity. Fourth, and the point I'm most proud of, is that, unlike other mortgage companies, we have continued to invest in our people and grow our team. Since the beginning of 2023, we've grown our team by about 15%. We've never laid off a single team member in our 38-year history.

And the point I'm most proud of is unlike other mortgage which we have continued to invest in our people and grow our team since the beginning of 2023 have grown our team by about 15%. We've never laid off a single team member and our 38 year history. The strength of our business gives us the ability to hire and invest in our people and we look forward to even more growth in 2020 for our culture and our team is a <unk>.

Matt Ishbia: The strength of our business gives us the ability to hire and invest in our people, and we look forward to even more growth in 2024. Our culture and our team are a differentiator, and people that have been to our office have been able to see that. Finally, we remain committed to sharing our success with our shareholders. For the 13th consecutive quarter, we will be paying a $0.10 per share dividend.

Rents yater and people that have been to our office had been able to see that firsthand.

Finally, we remain committed to sharing our success with our shareholders for the 13th consecutive quarter, we will be paying a 10 cent per share dividend as I've said multiple times before the dividend we paid out in good times in tougher times and is paying out in a year like 2023 should give complete confidence to the industry into the market that will continue going forward, both new Wm and the broker channel already dominate.

Matt Ishbia: As I've said multiple times before, the dividend will be paid out in good times and in tougher times. And if paying out in a year like 2023 should give complete confidence to the industry and to the market, then it will continue going forward. Both UWM and the Broker Channel are ready to dominate in 2024. There's no doubt in my mind that we are strategically positioned to seize the opportunity. Let's look closer at the fourth quarter.

24, there's no doubt in my mind that we are strategically positioned to seize the opportunity ahead.

Let's look closer at the fourth quarter.

Matt Ishbia: We closed $24.4 billion in production for the quarter at the higher end of the guidance, with $20.7 billion of that coming from just purchase. Gain margin was 92 basis points, also well within guidance, and after adjusting for changes in the fair value MSRs due to valuation inputs or assumptions, we generated pre-tax earnings of $39.2 million in the fourth quarter and $253.7 million for the year, both significant increases from 2022. In sum, we had a great quarter in a higher rate environment than fourth quarter 2022, and I'm confident 2024 will be a better year in this industry than 2023. Volume and margin should be higher, but whether they are or not, UWM will be successful and dominate with technology. I'm now going to turn the call over to our CFO, Andrew Huebacher. Thank you, Matt.

We closed $24.4 billion in production for the quarter at the higher end of the guidance with $20 7 billion of that coming from just purchase gain margin was 92 basis points also well within guidance and after adjusting for changes in the fair value MSR hours due to valuation inputs or assumptions, we generate pretax earnings of $39 2 million in the fourth.

Order and $253 7 million for the year, both significant increases from 2022 in sum, we had a great quarter and a higher rate environment in fourth quarter, 2022, and I'm, calling 'twenty 'twenty four we have a better year in this industry than 2023 volume and margins should be higher but even whether they are not U W will be successful in.

Dominate with technology and service.

I'm now going to turn the call over to our CFO Andrew Hugo. Thank you, Matt amidst the Doom and gloom that many others have espoused during 2023, we were pleased with our operational performance during Q4 and for the entire year.

Andrew Huebacher: Amidst the doom and gloom that many others have espoused for 2023. We were pleased with our operational performance during Q4 and for the entire year. Purchase business continued to lead the way as our total 2023 purchase originations were higher than both 2022 and 2021, even with the higher interest rate environment for all of 2023 and the significant decrease in industry-wide originality. While our fourth quarter and full year gap results were negatively impacted by the significant Q4 market rate decline and resulting impact on the estimated fair value of our MSRs, our operational income, before considering changes in the fair value of MSRs, Adjusted EBITDA for 2023 was $478.3 million, compared to $282.4 million in 2022.

Purchase business continued to lead the way as our total 2023 purchase originations were higher than both 2022 and 2021, even with the higher interest rate environment for all of 2023 and the significant decrease in industry wide origination volumes.

While our fourth quarter and full year GAAP results were negatively impacted by the significant Q4 market rate declines and resulting impact to the estimated fair value of Msr's are operational income before considering changes in the fair value of Msr's increased significantly in Q4 and for the full year.

Adjusted EBITDA for 2023 was $478 3 million as compared to $282 4 million in 2022 and for Q4, adjusted EBITDA was $99 6 million as compared to $60 4 million in Q4 of 2022.

Andrew Huebacher: And for Q4, Adjusted EBITDA was $99.6 million, as compared to $60.4 million in Q4 of 2022. With respect to MSRs, unlike some of our competitors, we have not historically specifically hedged the MSR portfolio. Rather, we maintain our portfolio at levels such that we are confident that MSRs will have fair value impacts due to interest rate declines will, over time, be more than offset by an increase in origination. We also have Jaramus, our portfolio, in what we believe to be the most efficient way by regularly selling MSRs, which we continue to opportunistically do throughout. Notwithstanding the gap net loss for the fourth quarter and full year, our capital and leverage ratios remain within expected ranges for the current year. Furthermore, our liquidity and access to liquidity, including cash and accessible borrowing capacity, approximated 2.2 billion as of the end of the year, which is a significant increase from the end of each of the last two years.

With respect to MSR is unlike some of our competitors, we have not historically, specifically hedge the MSR portfolio, rather we maintain our portfolio at levels such that we are confident that fair value impacts due to interest rate declines will over time be more than offset by an increase in origination income.

We also had Jeremy our portfolio and what we believe to be the most efficient manner by regularly selling msr's, which we continued to opportunistically do throughout the year.

Notwithstanding the GAAP net loss for the fourth quarter and full year, our capital and leverage ratios remain within expected ranges in the current environment. Furthermore, our liquidity and access to liquidity, including cash and accessible borrowing capacity approximated $2 2 billion as of the end of the year, which is a significant increase.

From the end of each of the last two years, despite what many would agree where challenging market conditions for mortgage originators in those years.

Matt Ishbia: Despite what many would agree were challenging market conditions for mortgage originators in the U.S., we believe that our current financial strength positions us well for different markets. OK, I will now turn things back over to our Chairman, President, and CEO, Matt Ishbia, for some closing remarks. Thanks, Andrew.

We believe that our current financial strength positions us well for different market cycles.

Okay, I will now turn things back over to our chairman President and CEO, Matt <unk> for some closing remarks, thanks, Andrew I'll close with a few points before jumping into the Q&A with all of you guys. We've been a public company for over three years now and that time, we hope you see that we consistently deliver on what we say we're going to do made a lot of different comments through the years and you can go back and listen in and we've always.

Matt Ishbia: I'll close with a few points before starting the Q&A with all of you guys. We've been a public company for over three years now. In that time, we hope you see that we consistently deliver on what we say we're going to do. I've made a lot of different comments through the years, and you can go back and listen in.

Matt Ishbia: And we've always hit those consistently. We believe 2024 will be a better overall year for the housing and mortgage industry. But regardless of the market, we will remain the best mortgage lender in America, and that recipe will not change. We will continue to build the best technology and provide the best service to the Broker Channel, take incredible care of our 7,000 plus team members by treating them like family, dominate the purchase business, and reward our shareholders with a consistent dividend. I'll conclude by saying I have zero doubt that the Broker Channel is the fastest, easiest, and cheapest way for a consumer to get a mortgage and undoubtedly the best part of the business for the loan officer to work in, and we remain 100% committed to the success of this channel. We expect Q1 production to be between $22 and $28 billion.

He's hit those consistently we believe in 'twenty 'twenty four will be a better overall year for the housing and mortgage industry.

But regardless of the market will remain the best mortgage lender in America and that recipe will not change we will continue to build the best technology and provide the best service to the broker channel take incredible care of our 7000 plus team members by treat them like family dominate purchased business and reward our shareholders with consistent dividend I'll conclude by saying I have zero doubt that the broker channels fastest easiest and cheapest way.

Because you only get a mortgage and undoubtedly the best part of the business with a loan officer to work and we remain 100% committed to the success of this channel. We expect Q1 production to be between 22 and $28 billion also I've always said the toughest mortgage environment that the lowest you'd ever see our margin would be 75 to 100 basis points and I have been guiding towards those numbers for a while now as I see the purchase market stable.

Matt Ishbia: Also, I've always said in the toughest mortgage environment that the lowest you'd ever see our margin would be 75 to 100 basis points. And I've been guiding towards those numbers for a while now. As I see the purchase market stabilizing and the refinery market starting to come on, I believe that margins will increase. So I'm going to take off our recent lows and move it to 80 to 105 basis points going forward. You can take that as me calling bottom or officially coming off the bottom with regard to our margin. I want to thank our amazing team members and our clients for a great year. And I look forward to growing in 2024 together with you. Now I'm going to turn it back over to the Q&A. At this time, I would like to remind everyone, in order to ask a question, press star, then the number 1 on your telephone keypad. If at any time you would like to remove yourself from the queue, please re-press star 1.

Rising in the refi market starting to come on I believe the margins will increase so I'm going to take off our recent lows and move it to 80 to 105 basis points going forward you can take that as me, calling bottom or officially coming off the bottom with regard to our margins I want to thank our amazing team members and our clients for a great year and I look forward to growing in 'twenty 'twenty four together now maturing.

Back over to the Q&A.

At this time I would like to remind everyone in order to ask a question Press Star then the number one on your telephone keypad. If at any time, you would like to remove yourself from the queue. Please read press star one at this time, we will pause momentarily to assemble our roster.

Operator: At this time, we will pause momentarily to assemble our roster. Our first question will come from the line of Kyle Joseph with Jeffries. Please go ahead.

Our first question will come from the line of Kyle Joseph with Jefferies. Please go ahead.

Matt Ishbia: Hey, good morning, Matt and Andrew. Thanks for taking my question. Just want to get a sense for activity quarter to date. Obviously, you guys have your guidance, but give us a sense for the cadence of originations, kind of pre- and post-CPI print, and potential implications for the more active spring season. Yeah, thanks for the question, Kyle. I appreciate it. So overall, I think we're, I can't go into all the details, but I think we're off to a great, great start this year.

Hey, good morning, Matt.

For taking my questions.

Wanted to get a sense for kind of activity quarter to date, obviously, you guys have your guidance, but.

Thanks for that.

Originations kind of pre and post the CPI print and how how that and potential implications for the more active spring season.

Yes, thanks for the question I appreciate it.

So overall I think I can't go.

All the details, but I think we're off to a great. Great start this year I think interest rates as we saw such a massive decline in the fourth quarter, which hit the MSR as you know a lot of it has come back up. So you obviously kept some of that income back on the first quarter, but we have not seen a decline from a perspective of business Thats why guide is actually higher.

Matt Ishbia: I think the interest rates, as we saw such a massive decline in the fourth quarter, which hit the MSRs, as you know, a lot of it has come back up. So you obviously catch some of that income back in the first quarter, but we have not seen a decline from a perspective of business. That's why I guided higher on production and guided higher on margins in the fourth quarter. And if you compare that to the first quarter of 2023, I think you'll see it very favorable based on my guidance and, hopefully, the execution of that. So I think this quarter will be a great quarter. And I think, like I said in the call, 2024 is gonna be a great year. Like everyone kind of feels, not only will rates drop a little bit, but also inventory will open up a little bit. The purchase season usually starts in March or April.

<unk> and guide higher than margins in the fourth quarter and you compare that to the first quarter of 2023, I think youll see very favorable based on my guidance and hopefully the execution that so I think this quarter will be a great quarter and I think like I said in the call 2024 should be a great year.

Everyone kind of feels not only rates will drop a little bit, but also inventory will open up a little bit the purchase season, usually starts March April we feel like it didn't even stop in January and February were pretty good from a purchase perspective and so.

Matt Ishbia: We feel like it didn't even stop in January and February. We're pretty good from a purchase perspective, and so we're feeling excited about what this year has in store. Got it. And then just one follow-up there.

We're feeling excited about what this year looks like.

Got it and then just one follow up there you mentioned kind of the refi and all of that.

Matt Ishbia: You mentioned kind of the refi channel is opening up a little bit with the rape movements in December. But just based on the forward curve right now, you know, how do you expect the mix of originations in 24 to compare to 23? And are there any sort of implications there in terms of margins? Are you guys kind of agnostic?

Up a little bit with rate movements in December.

Based on the forward curve right now.

Do you expect the mix of originations and in 'twenty, Florida compared to 23.

Are there any sort of implications there in terms of margins are you guys kind of agnostic to channel.

Matt Ishbia: Well, yeah, I mean, usually when rates go down, margins will go up. And that's because there's more action, more volume. A lot of our competitors have taken capacity out of the industry, so they're not able to handle the volume.

Well, yes, I mean, usually when rates go down margins will go up and that's because there's more action more volume a lot of our competitors have taken capacity out of the industry. Therefore, they are not able to handle the volume. So when you get a lot of volume and revised and rates dropped they slow it down by adding margin.

Matt Ishbia: So when you get a lot of volume when refis come and rates drop, they slow it down by adding margin. And so I think margins usually go up in a refi environment, and I think we've seen that in the past as well.

So I think margins usually go up in a refi environment and I think we've seen that in the past as well and so I.

Matt Ishbia: And so I do think that the purchase refi mix, I think you saw last year, you know, we're 85 to 88% in that range of purchase and having record numbers. That will change to where there'll be more refis. In 2024, we'll go down to 70% purchase or 80% or 50%. I don't know.

Do you think that the purchase refi mix I think you saw last year were <unk>, 85% to 88% in that range of purchase.

Having record numbers.

That will change so where there'll be more revised in 2024 will be will go down to 70% purchase or 80% or 50% I don't know what that depends on when rates drop and how much they drop but.

Matt Ishbia: That depends on when rates drop and how much they drop. But we're still going to continue to focus on doing a lot of purchase business because that's what the best mortgage companies do. And that's what we've been able to do even in this higher-rate environment. Got it. Thanks for taking my questions. I can hop back in the queue.

We're still going to continue to focus on doing a lot of purchase business because that's what the best mortgage companies do and that's what we've been able to do even in this higher rate environment.

Got it thanks for taking my questions I can hop back in the queue.

Operator: Thank you. Your next question comes from the line of Bo George with KBW. Please go ahead. Hey, good morning.

Thank you.

Your next question comes from the line of Bose George with <unk>. Please go ahead, hey, good.

Matt Ishbia: Matt, from your commentary on the broker share, it sounds like the broker share now is up to around 25% of the market. Is that right? And, you know, where do you see that going in the next couple of years? Yeah, so thanks for the question, Boz. I appreciate it. No, I don't think it's 25%.

Good morning, Matt.

Your commentary on the broker share it sounds like the brokers share now is up to around 25% of the market is that is that right and where do you see that going in the next couple of years.

Yes, so thanks for the question.

I appreciate it no I don't think its a 25% I think it's almost there I think it's getting there I think one of the last few years I saw was $22 eight 4% and so I've always been saying two out of 10 loans and now it's like getting closer to the 22 and a half.

Matt Ishbia: I think it's almost there. I think it's getting there. I think one of the last readings I saw was 22.84%.

Matt Ishbia: And so I've always been saying two out of 10 loans, and now it's like getting closer to 20, two and a half out of 10. And I haven't seen the fourth quarter numbers, but I expect it to be right around that 23% number of 20. So it's definitely going. But my point was really is, you know, we're competing for two or two and a half loans out of 10. And we're still in a dominant position.

I haven't seen the fourth quarter numbers, but I expect it to be right around that 23% number 20, so it's definitely going.

<unk> was really is we're competing for two two and a half loans out of 10 and were still.

<unk> position.

Matt Ishbia: As the broker channel continues to grow and get to three out of 10, or four out of 10 loans that we can compete for, UWM is going to grow as well. And so we feel like we have the upside of the market from a rate perspective, but the upside of the broker channel as well, that none of our competitors really have, at least none of the public competitors. Okay, great. Thanks.

The broker channel continues to grow and get the three out of 10 or 410 loans that we can compete more UWS going to grow as well and so we feel like we have the upside of the market from a rate perspective, but the upside of the broker channel as well.

None of our competitors really have at least another public competitors.

Okay, great. Thanks, and thanks I wanted to ask also about the Ginnie Mae <unk>.

Matt Ishbia: Actually, I wanted to ask also about the Ginnie Mae percentage that trended up a little more. Are they doing more on the purchase side? Is it streamlined refis, kind of a mix of everything, or just any commentary there?

<unk> has that trended up a little more are they doing more on the purchase side is there is it streamlined refis and if the mix of everything or just any commentary that would be great.

Matt Ishbia: Yeah, no, it's mostly purchased. The great majority of our business in the fourth quarter was still purchased. And so, streamlined refinances aren't really relevant, although they will become very relevant when rates drop a little bit. Right now, they're still not relevant.

Yes.

We purchased the great majority of our vision in the fourth quarter was still purchasing so streamlined refinances arent really relevant although they will become very relevant when rates drop a little bit right now there's still not relevant there's still a little ways out different rules and requirements around <unk>.

Matt Ishbia: There's still a little way out. There are different rules and requirements around FHA streamlines and VA earls, which are both in the government bucket, which, you know, you have to show enough savings to the consumer. I don't think the market has dictated that yet, but when rates get down to the low sixes or high fives, I think you'll see a frenzy of activity. And so, I wouldn't say it's tied to that.

Streamlines and VA, URL, which brought the government bucket.

Yes, sure enough savings to consumers don't think the market has dictated that yet, but when rates get down to the low 60, <unk> high fives, I think youll see a frenzy of activity and so I wouldn't say, it's tied to that I think it's still majority purchase but.

Matt Ishbia: I think it's still majority owned, but, you know, that will start to happen here. Okay, great. Thank you. Your next question comes from the line of Steve DeLaney with Citizens JMP. Please go ahead. Thanks. Good morning, Matt.

That will start to come here soon.

Okay, great. Thank you.

Your next.

Question comes from the line of Steve Delaney with citizens JMP. Please go ahead.

Good morning, Matt.

Matt Ishbia: You're not built around refis. You know, we've been hung up here around 7% and haven't seen a refi market for what, you know, three, four years. How low do you think a 30-year rate has to go to really spur any kind of material refi event in the industry? Yeah, thanks for the question.

Hello.

Not rebuilt around Refis.

No we've been hung hung up here around 7%.

And haven't seen a refi market for what three or four years.

How low does it do you think your 30 year rate has to go to really.

Matt Ishbia: So I think it's got to make sense for consumers, and I think it's got to be, it depends on where they did their last loan. So usually, it ties to, you know, can you save the consumer a half point in rate? That's usually how you think about it. And so borrowers that, you know, in October of this past year, that were doing rates at 7.75, right, and then rates dropped to where you're doing them at 6.75. Like those, different borrowers will have different times when they refinance. But generally speaking, when rates get to 5.75 to 6.25, you're going to see a lot of refi activity. Because it's been a couple years now that people have been doing loans at 6.5, 7, and 7.5.

Spur any kind of a material refi event in the industry.

Yeah. Thanks for the question so.

It's got a big sense for consumers and I think it's got to be.

It depends on where they did their last loans are usually it ties to can you say at the consumer a half point in rate as you think about it.

So borrowers that in October of this past year that were doing rates at 775, and then rates dropped to where youre doing at 670.

75%.

Current borrowers will have different times, they'll refinance, but generally speaking when rates get too.

Seven 5% to 6% quarter youre going to see a lot of refi activity.

Matt Ishbia: Even that's why our MSR book, we've been doing, we're doing the most loans of anyone. So I know where the loans are being done; they're being done at 6.5, 7, 7.5. So when rates get to 6.25, I call it 5.99.

It's been a couple of years now where people have been doing loans of 657 to seven five.

It's why our MSR book, we've been doing we're doing the most loans of everyone. So I know where the loans are being done are being done at 657% seven five so when rates get to six and a quarter I'll call. It $5 99, I think that will create enough of a benefit for a consumer.

Matt Ishbia: I think that will create enough of a benefit for a consumer to refinance. But beyond that, Steve, as the number one purchase lender, you'll see that when rates get to 5.99, all of a sudden, those purchases will start to pick up even more too. And so we think purchase will open up, inventory will open up, and rates will drop at refis. I think it's going to be a very, very positive environment, whether that happens tomorrow or in three months or six months or nine months, it's going to happen. We just don't know when.

To refinance but beyond that CBS is the number one purchase lender youre going to see when rates get to $5 99, and all of a sudden those purchases will start to pick up even more too and so we think purchase will open up inventory will open up in rates will drop a revised I think is going to be a very very positive environment, whether it happens tomorrow or in three months or six months or nine months, it's going to happen.

Matt Ishbia: And that also will then dictate margins will go up, which is why I guided off the bottom. Yeah, that's great color about hadn't we thought about the purchase purchase benefit, in addition, because that's a lot of people are going to qualify now that may not have. So when this when the shift comes, and it will come, will UWM continue to work with borrowers through your broker? And you seem to be resolute on that, that you work with the broker to get to the customer as opposed to creating your own call center like so many have tried to do, you know, over the years to capture the borrower. Thanks.

Don't know when.

Also will then dictate margins will go up which is why I guided off the bottom.

Yeah, that's great color about hadn't really thought about the purchase.

Purchase benefit in addition, because thats a lot of people are going to qualify nailed it may not have.

So when this when the shift comps and it comps will <unk> continue to work back to borrowers through your brokers.

Matt Ishbia: Yeah. 100% We're going to go through our brokers. It's the right thing to do. It's inappropriate what some of my competitors do and how they attack the broker's business. It's just they're downright wrong, and they run poor companies; sorry to tell you that. It's just not the right thing to do. And so, to attack your client, your client sends you a loan, and then you refinance that client. It's just the wrong thing to do.

You seem to be resolute on that that you work with the broker to get to the customer as oppose to creating your own call center like so many have tried to do over the years to capture the borrower.

Yes.

3rd%, we're going to go through our brokers, it's the right thing to do.

What's my competitors do and how they attack the brokers business, it's just they're downright wrong in there.

Matt Ishbia: And obviously, we know Rocket and some of those other guys have done that for years, and they're just doing the wrong thing for brokers. And that's why the brokers know that. So we will never, you can mark my words, never do that.

I run poor companies sorry to tell you that it's just not the right thing to do and so to attack your client your client send you alone and you refinanced the client. It was just the wrong thing to do and obviously, we know rocket and some of the other guys have done that for years and they are just doing the wrong thing to brokers and Thats why the brokers know that so we will never.

Matt Ishbia: We always give them back to the broker. We'll help the brokers. We'll show them how to refinance. We'll do training. We'll coach them.

I was never do that we always give them back to the broker will help the brokerage will show moderate refinance will do trainings will coach them will show in which clients.

Matt Ishbia: We'll show them which clients, like how to call them and how to sell them. Like we do all the things, but it's the broker's client, not ours. And that's the right way to run a business. And that's why we've been so dominant in the broker channel and this industry for years. Thanks for the comments, Matt.

Call on how to sell it like we do all the things, but it's the brokers client not ours and Thats the right way to run a business. That's why we've been so dominant in the broker channel in this industry for years.

Thanks for the comments, Matt Thank you.

Matt Ishbia: Thank you. Your next question comes from the line of Doug Harder with UBS. Please go ahead.

Your next question comes from the line of Doug Harter with UBS. Please go ahead.

Matt Ishbia: Thanks, Matt. I'm hoping, as you're seeing gain margins come off the lows, you can think about what are the different types of environments that would cause you to kind of be at the low, middle, and high end of your new range. Yeah, so the, you know, the 75 to 100, I think I said on Friday. I don't know how many quarters I guided towards it, but probably five, six, seven quarters of my guess. I don't remember exactly.

Thanks, Matt we're hoping.

As youre seeing gain margins come off the lows how to think about.

What are the different types of environments that would cause you to kind of be low middle or high end of your new range.

Yes so.

The 75 to 100, I think I've said, probably I don't know many quarters I guided towards it probably 567 quarters. My guess I don't remember exactly but the reality is in the toughest mortgage market you Wm.

Matt Ishbia: But the reality is, in the toughest mortgage market, UWM will be, we are kind of the bellwether for what happens on the margins and how the business goes. And we've said, hey, 75 to 100 is where it's going to be. Now, as the market starts to get better, I'm basically calling the bottom. It's not going to get worse than it was; we're gonna move it to 80 to 105. And then whether I stay like that for a couple quarters, or maybe I go to 85 to 110.

We are at the kind of the bellwether for what happens in the margins and how the business goes and we've said Hey, 75 to 100, where it's going to be.

Now as the market starts to get better I'm basically calling bottom it is not going to get worse than it was where to move into the 80 to 105, and then where do I stay like that for a couple of quarters and maybe I'll go to 85 to 110, and maybe I guess going to gives you didn't go eventually gets back to more normalized numbers when it's a refi environment or a more normalized market right now we're not there, but what I'm trying to signal to you and everybody else is it's on.

Matt Ishbia: And maybe it's going to continue to go eventually get back to more normalized numbers when it's a refi environment or a more normalized market. Right now, we're not there. But I'm trying to signal to you and everybody else is, it's on the way, it's on the way we're off the 75 to 100, it'll be 80 to 105 while I go to 85 to 110 next quarter. I don't know, maybe I go 80 to 105 for the next couple of quarters, or maybe I go to 90 to 115. Like it's on the way up, it's not going back And you see, we've been consistently at the middle to high range of the margin of the of the range. Now I can move the range up. And I expect that this will continue to move the range up, whether it's next quarter, the quarter after, or sometime in the near future. Appreciate that, Matt.

It's on the way we're off the 75 to 100. It will be 80 105, why go to 85 to 110 next quarter I don't know if <unk> five for next couple of quarters or maybe I got 90 to $1 15 like its on the way up it's not going back and you've seen we've been consistently at the middle to high range of the margin.

Over the range and now I can move the range up and I expect that that will continue to move the range up whether it's next quarter the quarter after or sometime in the near future.

I appreciate that Matt and then.

Matt Ishbia: And then, as you're thinking about the landscape as kind of all the realtor lawsuits and changes going on there, I guess, how do you think that impacts or does that impact the broker, and what challenges or opportunities does that create? You know, usually, real estate agents and brokers are really tied to the hip. So mortgage brokers and real estate agents do a lot of the same things. They're great for consumers because they're on the ground talking to people.

As youre thinking about.

The landscape as kind of all the reorder lawsuits and changes going on there I.

I guess, how do you think that impacts or does that impact the broker and what challenges are opportunities does that create.

Usually.

Real estate agents and brokers are really tied to hip.

So mortgage brokers and real estate agents do a lot of the same things they are great for consumers there theyre on the ground talking to people. So obviously when impacts happen to comp or potentially happened hasnt happened in I don't know if they will for years to be honest with you, but it will impact potentially happen that creates opportunity.

Matt Ishbia: So obviously, when impacts happen to comp or potentially happen, they haven't happened in, I don't know if they will happen for years, to be honest with you. But when impacts potentially happen, that creates an opportunity for the best real estate agents, the best brokers to take advantage of it and create a new opportunity to grow their business. Just like years ago, LO comp changed in the mortgage market. Brokers were supposedly going to lose comp, and all this stuff happened, and brokers have actually thrived because of it. And so I look at these things as opportunities. How in the weeds are you in that business? And real estate professionals are resilient, just like mortgage brokers are resilient. And so I'm not really concerned about them, their impact on the business. Brokers and real estate agents are tied at the hip. They will help each other grow, and help each other succeed. And hey, maybe you don't have to do this.

For the best real estate agents, the best brokers to take advantage of it and create a new opportunity to grow their business.

Like years ago, although comp changed.

The mortgage market brokers are supposedly going to lose comp and all those that haven't and brokerage actually thrive because of it. So I look at these things as opportunities how long do we is there are you in that business and real estate professionals, our resilient just like mortgage brokerage resilient and so im not really concerned about them that impacted the business brokers and real estate uses are tied at the hip they will help each other grow help each other succeed.

And maybe you don't have to do is they'll do more business and as they do more visits that helps them and helps loan officers and helps you Wm and helps consumers and so we'll see how it all shakes out I think it's too early to really get a read on what will happen, but I do think that usually people that are very involved in the business very in the weeds. There. This is like <unk> and like brokers are in real estate, it's usually.

Matt Ishbia: They'll do more business, and if they do more business, that helps loan officers, and helps UWM, and helps consumers. And so we'll see how it all shakes out. I think it's too early to really get a read on what will happen, but I do think that usually people that are very involved in the business, very in the weeds of the business, like UWM is, and like brokers are, and real estate agents, usually capitalize on change more than get hurt by change. I appreciate those insights. Thank you. Your next question comes from the line of James Fawcett with Morgan Stanley. Please go ahead. Yes, hi, good morning.

Capitalized unchanged more than get hurt by change.

I appreciate those insights thanks, Matt.

Thank you.

Your next question comes from the line of James Faucette with Morgan Stanley. Please go ahead.

Yes, hi, good morning, this is actually Jeff Adelson on for James <unk> Good morning.

Matt Ishbia: This is actually Jeff Adelson on for James Fawcett. I just wanted to circle back on some of the pricing initiatives you guys have talked about. I know about a month ago you launched this Rebuy 100 initiative. Just curious what the uptake on that has been like with your brokers and volumes, like how meaningful that has been for your volumes so far this quarter and, just maybe, your appetite for additional pricing initiatives going forward. Yeah, so first off, you know, talking about pricing initiatives and different things we've done over the years. And I think it's good because I think, you know, a lot of you guys have been following us for years and seeing when we said game on. What was that 15 months ago? And what would we do with that as a pricing initiative? And like, how's that working? And obviously, if you look at the fourth quarter of 2020, 22 versus the fourth quarter of 23, we had a game on in the fourth quarter of 22, which means half the margins.

Just wanted to circle back on some of the pricing initiatives you guys have talked about I know about a month ago. You launched this re buy 100 initiative just curious what the uptake on that has been like with your brokers and volumes like how meaningful that's been for your volume so far this quarter and just maybe your appetite for additional pricing initiatives.

Onboard.

Yes, so first off talking about pricing initiatives and different things we've done through the years and I think it's good because I think.

A lot of the guys who've been following us for years and seeing from what we said game on what was that 15 months ago.

And what we would do with that as a pricing initiative and how is that working and obviously if you look at the fourth quarter of 2000.

22 versus the fourth quarter of 'twenty three we had game on in fourth quarter of 2002, which means half the margins and we did and it was a lower interest rate environment and this year in fourth quarter 'twenty three we have much bigger margins higher interest rate environment, we still did more business. So I think it talks to some of these initiatives that create stickiness. What we know is this for <unk>.

Matt Ishbia: And we did, and it was a lower interest rate environment this year in fourth quarter 23. We had much bigger margins, a higher interest rate environment, and we still did more business. So I think it talks to some of these initiatives that create stickiness. What we know is this for facts. UWM is the best mortgage company in America.

<unk> <unk> is the best mortgage company in America, we are without question the best wholesaler in the country. The game for US is we want to get loan officer to lead the retail channel enjoying the broker channel, which they are happening all the time I talk to them all the time, it's happening right now.

Matt Ishbia: We are without question the best wholesaler in the country. The game for us is we want to get loan officers to leave the retail channel and join the broker channel, which they are doing all the time. I talk to them all the time.

Matt Ishbia: It's happening right now. And on top of that, we want brokers that are in the broker channel to try UWM. When they use UWM, they become sticky because UWM is the best.

And on top of that we want brokers that are in the broker channel.

<unk> I mean, when the UWS becomes sticky because UW was the best we help them grow their business. We help train them, we help them partner with real estate as we help them market like we do all this stuff and so it's all about getting them so pricing incentives and different initiatives are always focused on long term I'll never focused on the short term impact from focus on what does that mean long term and I think if you go back and read what I said.

Matt Ishbia: We help them grow their business. We help them train them. We help them partner with real estate agents. We help them market. Like we do all the stuff. And so it's all about getting them in. So pricing incentives and different initiatives are always focused on the long-term. I'm never focused on the short-term impacts.

Matt Ishbia: I'm focused on what that means long-term. And I think if you go back and read what I said, maybe, you know, in June or whatever it was in 2022 about what success looks like on game on, it's going to be broker channel growth, loan officers converting, which has happened. And then does UWM gain market share and also retain market share when we go back to normalized margins?

Maybe in June or July whatever it was in 2022 about what success looks like on game on it's going to be broker channel growth loan officers, converting which has happened and then does UWS gain market share and also retain the market share. When we go back to normalized margins and I think the data shows that we've done that and then some and so I look at these things all positive health.

Matt Ishbia: And I think the data shows that we've done that and then some. And so I look at these things as all positive. Help brokers differentiate. Help brokers grow. Our whole game is helping the brokers win. Help more consumers. Because, by the way, brokers are better for consumers. They save the consumer. You go to mortgagematchup.com, and it saves consumers thousands and thousands and thousands of dollars.

Brokers differentiate help brokers grow our whole game is helping the brokers when help more consumers because by the way brokers are better for consumers. They say, you've got a mortgage matchup dotcom and it saves consumers.

And thousands and thousands of dollars, it's crazy and so it's crazy consumers don't know this and so we're very excited how do we educate consumers how do we educate real data how do we help although succeed and all of those things sometimes pricing initiatives on a refi helps some nice pricing has not purchased.

Matt Ishbia: Like it's crazy. And so it's crazy that consumers don't know this. And so we're very excited. How do we educate consumers? How do we educate real estate agents?

Matt Ishbia: How do we help LOs succeed? And all those things. Sometimes, pricing initiatives on a refi help. Sometimes, pricing initiatives on a purchase. Sometimes, on a free appraisal.

Matt Ishbia: Sometimes we do none of that stuff, but I'm always open to those things. Anything to help brokers win and succeed. And that's what we've been doing, and that's why we're winning too. Great. Thanks for that color.

Reappraisal, sometimes we do none of that stuff, but I'm always open to those things anything to help brokers win and succeed and that's what we've been doing and Thats why were opening too.

Okay, great. Thanks for that color and just.

Matt Ishbia: And just on MSR, I don't think I've heard anything so far, but it seems like, from the disclosures, you didn't do any MSR sales this quarter. Is that right? And why was that?

On the MSR I don't think I heard anything so far but it seems like from the disclosures you didn't do any MSR sales. This quarter is that right and why was that and maybe what's your appetite.

Matt Ishbia: And maybe what's your appetite looking like going forward? Yeah, we did one excess trade in the fourth quarter. So, we've done some trades already this year. Like Andrew said, hedging MSRs like we had a bigger MSR markdown, I think 600 plus million dollars in the fourth quarter, which is obviously just paper moving. It means nothing.

Like going forward there.

Yes, we did once one excess trade in the fourth quarter. So.

And we've done some trades already this year.

Like Andrew said is hedging MSR as like we had a bigger MSR markdown I think $600 million in.

In the fourth quarter, which is obviously just paper moving it means nothing.

Matt Ishbia: And you'll see some of that come back this quarter. But once again, don't give me credit for that. Then, just like I hope we don't give him credit like it doesn't matter.

And youll see some of that come back this quarter, but once again don't give me credit for that and then just like I Hope, we don't give me it doesn't matter, but the truth is we have a bigger write down or write up that other people because we're actually the only we actually originate loans at these rates. So if you look at our book, we have more higher rate of our book because we actually did loans in the third and fourth quarter when everyone else does.

Matt Ishbia: But the truth is we have a bigger write-down or write-up than other people because we're actually the only one actually originating loans at these rates. So we have, if you look at our book, we have a higher rate on our book because we actually did loans in the third and fourth quarter when everyone else did. And so those loans actually took a bigger write-down, which is why we had a bigger write-off than most people in the fourth quarter. And then, coincidentally, or conversely, you'll see that in the first quarter or write-up of those because rates have gone back up since January 1st. Obviously, we'll see what happens in March. You can't I can't control that stuff.

So those loans actually took a bigger write down which is why we had a bigger write off than most people in the fourth quarter and then.

Coincidentally, youll see that or Conversely, you'll see that in the first were a write off of those because rates have gone back up since January one.

Obviously, we'll see what happens in March I can't control that but that's not relevant but we are selling msr's.

Matt Ishbia: But that stuff's irrelevant. But we are selling MSRs, and we'll continue to sell MSRs and get good prices for bringing in cash and continue to build the business when we see an opportunity to do so. Okay, great. Thanks for taking my question, Matt.

And we will continue to sell on us ours and getting good prices for bringing cash and continue to build the business when we see an opportunity to do so.

Okay, great. Thanks for taking my question.

Operator: Thank you. Your next question comes from the line of Mark Deveries with Deutsche Bank. Please go ahead.

Your next question comes from the line of Mark Devries with Deutsche Bank. Please go ahead.

Matt Ishbia: Yeah, thanks. I just had a follow-up question on the origination guidance for the first quarter. It's a pretty wide range, just given we're almost two-thirds of the way through the quarter. Can you just give us a better sense as to why that is? Kind of what scenario brings you to the low end of that range, and what scenario brings you to the high end? Yeah, actually. I think I closed the range down.

Yes. Thanks.

Follow up question on the origination guidance for the first quarter.

It's a pretty wide range, just given where almost two thirds of the way through the quarter or can you just give us a better sense as to why that it is kind of what scenario. It brings you to the low end of that range in what scenario brings you to the high end.

Yes, actually I think.

Matt Ishbia: I usually give a $7 billion range, but I think I gave a $6 billion one. So I actually gave a smaller range this time. But the truth is, I try to be consistent: six or $7 billion. Obviously, I have a good feeling of where we're going to be, and that's why I guide them to that range. And I think we'll be in the range, like I'm always in the range of my guidance from a margins and volume perspective. And so you've got to realize that compared to last year's first quarter and even the fourth quarter, I'm basically guiding that we're going to do more business in a much higher rate environment in the tough mortgage industry. January, February, and March are usually the slowest months.

I close the range that I, usually give a $7 billion range I think you have a $6 billion one so.

Could you give a small range. This time, but the truth is I tried to be consistent six or $7 billion range.

Obviously.

I have a good feeling of where we're going to be and Thats why guide to that range and I think we'll be in the range like always in the range of my guidance for margins and volume perspective and so.

You've got to realize that.

Compared to last year's first quarter, and even the fourth quarter and basically guiding that we can do more business.

Higher rate environment, and the tough mortgaging the industry January February March are usually disclose months, usually actually November December January February the toughest months, specifically January and February, especially with your purchase lender when you revised it doesn't matter when youre dealing with Youre purchases.

Matt Ishbia: Usually, actually, November, December, January, and February are the toughest months, specifically January and February, especially when you're a purchase lender. When you're refinanced, it doesn't matter when you do it. But your purchases are slower in January and February. People aren't moving while they're in school. It's cold in the northern part of the country.

Slower in January February people arent moving while they're in school, it's cold in the northern part of the country. There's a lot of reasons that purchases slowdown.

Matt Ishbia: There are a lot of reasons that purchases slow down. So I think 22 to 28 is a good guidance. I think 80 to 105 is a good guidance. And as I've done every single quarter, we always hit those guidances, and consistently we will do that. I plan on doing that in the first quarter as well.

So I think 22 to 28 is a good guidance I think 80 to 105, the good guidance and as I have done every single quarter. We always hit those guidance is and consistently we will do that I plan on doing that with the first quarter as well.

Matt Ishbia: OK. That's helpful. Thanks. Again, if you would like to ask a question, press star, then number one on your telephone keypad. Your next question will come from the line of Eric Hagen with BTIG. Please go ahead. Hey, thanks. Good morning.

Okay. That's helpful. Thanks.

Again, if you would like to ask a question Press Star then the number one on your telephone keypad. Your next question will come from the line of Eric Hagen with BTG. Please go ahead.

Matt Ishbia: Hope you guys are well. A couple more follow-ups on the MSR. I mean, are you still targeting an MSR portfolio around, call it, 300 billion UPB? And can you also remind us, does your MSR fair value mark include an estimate for recapture? Thank you, guys. Yeah, so good questions. You're obviously in the weeds. You know the game.

Hey, Thanks. Good morning Hope you guys are well couple of more follow ups on the MSR. I mean are you still targeting an MSR portfolio around call. It 300 billion of U P. V and can you also remind US does your MSR fair value Mark include an estimate for recapture.

Thank you, yes, so good questions Youre, obviously in the weeds.

Matt Ishbia: No, we do not put an estimate for recapture in there, so therefore, that's what all my other competitors do to beef up their numbers, which is a false way of doing it, but you get that and understand the business well enough to ask the question, so you know that. On the other side of it, MSR is $300 billion. We look at it... What's the right range? There's not an exact range, but I think it's important if you have an MSR book that you can originate. You know, I think at least half of your origination book, if not a little bit more.

No we do not put an estimate to recapture in there. So therefore, that's what all of my other competitors due to beef up their numbers, which is a false way of doing it but you get that and understand the business well enough to ask the question. So you know that.

On the other side of it MSR is $300 billion like we look at it.

Whats the right range is not an exact range, but I think it's important if you have a MSR book that you can originate.

<unk>.

At least half of your origination book, if not a little bit more so I think as we look at can we do more than $150 billion. Yes. We can so I wouldn't want to go much higher than $3 50 or $400 million on the book, but I probably won't go below 200 in that so I think 250 <unk> rate range, that's kind of where we will see it we're doing a lot of business right now, we'll sell some here and there, but <unk> rate range. If you want me to.

Matt Ishbia: So I think, like we looked at, can we do more than $150 billion? Yes, we can. So I wouldn't want to go much higher than $350 or $400 billion on the book, but I probably won't go below $200 in that. So I think $250 to $350 is the right range.

Matt Ishbia: That's kind of where we'll sit. We're doing a lot of business right now. We'll sell some here and there. But $250 to $350 is the right range. If you want me to tighten it up, I'd probably say $275 to $325, but I think you're saying $300.

Lightened up at <unk> 75 to three in a quarter, but I think you were saying 300, so plus or minus thats right.

Great. Thank you. Thank you very much for that.

Matt Ishbia: So plus or minus, that's right. Love it. Great. Thank you. Thank you very much for that.

We know that Theres, a lot of competition between broker and retail a lot of migration of loans going back and forth between the channels, sometimes but how.

Matt Ishbia: You know, we know that there's a lot of competition between, you know, broker and retail, a lot of migration, loans going, you know, back and forth between the channels sometimes. But how aggressive or how much market share do you feel like you could take out of the correspondent channel this year? Well, honestly, the Correspondent Channel is not really a channel. I know some of our competitors like to say that they originate loans in the Correspondent Channel, but if you don't underwrite the loan or don't originate the loan, you didn't do the loan, right? You can't do the loan twice, and so I don't really look at any volume in the Correspondent Channel.

How aggressive or how much how much market share do you feel like you could take out of the correspondent channel.

This year.

Well so.

Honestly the correspondence channel is not really a channel I know some of our competitors like to say that they originate loans and a corresponding channel, but if you don't underwrite alone or don't originate the loan you didn't do the loan rate you can't do it alone twice and so I don't really look at any volume in the correspondent channel I know some pieces report correspondent volume, but honestly there is retail and there is wholesale that's all the originations because corresponded some <unk>.

Matt Ishbia: I know some places report correspondent volume, but honestly, there's retail and there's wholesale. That's all the originations because the correspondent is some retail lenders who do the loan and then they sell it to a Chase or a Wells, and then Wells and Chase report that as their volume, and then so does the retail guy. So it's really double counting.

<unk> lenders due to loan and then they sell it to a chaser of wells and then wells and chase.

That is their volume and then sort of as the retail guys. So it's really double counting so I really don't look at.

Matt Ishbia: So I really don't look at correspondent as an opportunity to grow the business. I look at it, it's just, it's actually just people reporting numbers incorrectly. But on this website, there are a lot of banks that are getting out of the market because of different capital rules and different things. But also, people always like to blame the capital rules, and the banks will tell you, oh, the capital rules are harder to originate mortgages. My mortgage doesn't make sense.

Correspondent as an opportunity to grow the business I look at is it just.

Actually just people reporting numbers incorrectly, but on the flip side. There is a lot of banks that are getting out of the market.

Because of the different capital rules different things, but also people I'd like to believe the capital when the banks will tell you all the capitals are harder to originate mortgage mortgage doesn't make sense, but the truth is it's really hard to compete.

Matt Ishbia: But the truth is, it's really hard to compete. Like, all we do is mortgage. We live, eat, and sleep mortgage. And banks and other places do a lot of business, a lot of different things. And by the way, they're great partners, and they do a lot of great things for all of America, but it's hard to be great at 28 things. It's really hard to be great at one thing also.

All we do is mortgage we live eat sleep mortgage and banks and other places do a lot of business a lot of different things and by the way. They are great partners and a lot to do great things for all of America, but it's hard to be great at 28.

It's really hard to be granted one thing also we are not only great. We are the best at one thing in mortgage and so what we're focusing on as brokers.

Matt Ishbia: We are not only great; we are the best at one thing in mortgage. And so, what we're focusing on is brokers, you know, growing their business, building more relationships with real estate agents. We're teaching brokers how to handle scale, because when refis come, how can they double their business in a month? Like, literally.

Growing their business building more relation with real seasons, we're teaching brokers how to handle scale because when refis come how can they doubled their business in a month like literally and so we're doing things, we built PAA, possibly build different things out to help brokers handle scale, which is a big part of our initiatives and you'll hear more and more of it in the second quarter and third quarter, what we're doing by the technology and initiatives to help brokers handle.

Matt Ishbia: And so, we're doing things. We built PA Plus. We built different things out to help brokers handle scale, which is a big part of our initiatives. And you'll hear more and more of what we're doing in the second quarter and third quarter, tied to technology and initiatives to help brokers handle scale. And then the other part is converting loan officers over from retail to wholesale. And I think you'll see in the media here in the near future that some of the top loan officers in retail have converted over to brokers. And that's not been reported yet, but you'll see it come out that some of the top five, top 10 loan officers that used to be all retail, now have converted. And by the way, when you're all retail, I can get zero of your business. When you become wholesale, now I have a chance. And usually, they'll come over because they know how strong UWM is.

Scale and then the other part is converting loan officers over from retail to wholesale and I think youll see in the media here in the near future that some of the top loan officers in retail have converted over to broker and that has not been reported yet, but youll see it come out that's on the top five top 10 loan officers it used to be all retail now converted and by the way when Youre all retail I can get zero of your business. When you become wholesale now I have a chance.

And usually they'll come over because they know what's wrong UWS I've met with some of these people when they are going to get 60, 70 80, 90% of their business and so you are starting to see that transition. So there's a bunch of different buckets, but I really don't look at correspondent is one of them to answer your question, but I really look at broker and retail and that's the competition and how do we help brokers grow and succeed and that's what we're focused on.

Matt Ishbia: I've met with some of these people, and we're gonna get 60, 70, 80, 90% of their business. And so, you're starting to see that transition. So, there are a bunch of different buckets, but I really don't look at correspondent as one of them to answer your question. But I really look at broker and retail, and that's the competition, and how do we help brokers grow and succeed?

Great stuff great detail. Thank you so much.

Hey, Thanks for the question appreciate you.

Is that all the questions I think.

Operator, all the questions. So we're good so.

All of those Lee. Thank you guys for the time I. Appreciate all of you guys and gals for jumping on the call hopefully is valuable and we will talk to you. After the first quarter for the next quarterly call have a great day.

This concludes today's conference call and you may now disconnect.

Matt Ishbia: And that's what we're focused on. Great stuff. Great detail.

Please wait the conference will begin shortly.

Matt Ishbia: Thank you so much. Hey, thanks for the question. I appreciate you.

Operator: Is that all the questions, I think? Moderator: All the questions, so we're good, so all of those leave with: thank you guys for the time. I appreciate all of you guys and gals for jumping on the call. Hopefully, it was valuable, and we'll talk to you after the first quarter for the next quarterly call. Have a great day. This concludes today's conference call, and you may now disconnect. Please wait. The conference will begin shortly. Please wait. The conference will begin shortly.

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