UWMC - Earnings call transcript Q2 2021 | UWM Holdings Corporation

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Operator

Good morning. My name is Zen, and I will be your conference operator today. At this time, I would like to welcome everyone to the UWM Holdings Corporation Second Quarter 2021 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. you. Thank Instructions] [Operator may conference. you begin Roslin, your Matt

Matt Roslin

Corporation. Matt Thank welcome you of Legal UWM to Investor Relations. Affairs and Holdings for for call Second XXXX Roslin, Quarter EVP the earnings joining us, and

the Before we start, includes would like statements. conference everyone to forward-looking call remind I that

to morning. to For release the about results that may forward-looking from we cause that information materially statements, this earnings more actual issued factors differ please refer

Tim CEO the introducing cannot Mat, reasons. to want us both that and financial due be Wholesale Forrester, Before Holdings the CFO, today inform everyone with the delivering United updates call Mat our on will Ishbia, of I to today's Corporation, on be business Mortgage, personal Chairman UWM and call.

Mat Ishbia

you, It's call joining after thank everyone, here, at especially Thanks, for great outstanding be Matt. today. quarter here another UWM. it. the to Appreciate And

hold to the start, we QX well. we is expected an see talk big you for partner do important Company production Second I billion going our post things, many happen UWM, let our America to to in in of later last history us partners Purchase call. going on On production numbers difference we respects we numbers about We are We about what I only throughout very details what just delivered on. we the as I in explain every and in $XX.X almost how you best so results as most in it for resulted later for guys make as loans, what's know competitors measure; volume and excited not doubled will Quarter out from over but call, Before proud to we're say. we XX accountable XX and going our excited quarter guided record our above less quarterly a our purchase time, think in prior delivered do guidance independents an did when to prior want to at compared production, the XX% billion our here about in this of on that's we about mortgage up production, share time to them. perspective, talk quarter I'm team The our production all overall by of did brokers, results; UWM there, great members doing was market thank a the and significant mortgage with a at our were the to to was our and at quarter beating increase of volume, UWM. billion. amount At and less to

Our is gain actually line was number than in year and basis guidance XX with historic numbers. lower points a margin

including overall at sequential industry it as provided a has plus a I me, Second was increase out is And had the the great million More control XX% like approximately control. of QX over We posted the we're The XXX% to and earnings, as America, increase business income. interesting assessing That's to perspective company positive, mortgage kind a and is. are on it's We've from add it, the future back basis, assumptions. mentally subtract I purchase it changes change really exciting the run There's to if call to deliver great XX%. run value we make the how fluctuating glimpse me, fair sure the and of quarter-out. at the like we mortgage XXX solid our [Indiscernible] our to as I XX% asset well. in the couple a think we of on we're time business, company to The earnings of very way think elite million production. of market MSR representative production though, do of obviously Quarter was change operating same XX% times, what not with XXX.X market a overall of increase represent our all business in of the in we production proud perspective, in into in in that profit. and Second reasons. business; asset, a $XXX no in the America the proud was when looks increase year-over-year certain that MSR [Indiscernible] of on more production; as down to the noted or our it First I and actually or our really million XXX health impact move we show quarter-in of, an net I values for Quarter Quarter. We a However, fair back From asset, the When delivered can't MSR to our up the core results you, I to I a that a like already million.

off, First weighted X.XX. XX-year X.XX to went from rate, average the [Indiscernible],

point we doubled we became shut the if refi refi X%, billion flat, mix you'll volume business how see about great purchases relative lot the of people a goes and from quarter-over-quarter. billion volume purchase production a based The and for have originators. we our purchase really rates, down. purchase purchase and thought on, But That because went thing not reacted. declined, down XX Wait stayed strength rates. and of till it is UWM XX to from small refi XX across-the-board. important basis X.XX your and almost only in our the looks business on rise about you'd So rise was in more focus but mix just increased focus on to whole 's mortgage a industry actually mix

about doing really by less speak to X%, the we change when to purchase that's a all, of about refinance. about which note from is to mix to best strength And to can it's to believe not go mortgage business, we like our we're companies We're business. like really but talk or story the tell. percentage that at or shine, are companies speak when purchase trying that's it and really Some mix will And don't solely purchased X.X Company. rates important X.X, X.X trying that the or

or XXXX quarter the in how you frothy out like of in a business. such XXXX, the Just is first when tide can perform see not people

So second production. quarter, XX.XX purchase

think be way this a to we number important to time, the it do a business because share, by far had only business understand How overall Our not year, America. with. companies we that purchase in company the in service. independent we'd gained if are quarter time. model in a market? our of maintain of and of you mortgage this quarter in Simple; mortgage best best you business that very no it, purchase if refi all almost retain our one our that we which And business, we billion all about $XXX when It's would purchase growing with broker in partner a business in history is and partners prove speed our

that's continue love but profitable more we faster anyone they a the Our our we're America. never our talk to cost with estate to guess loans than broker and business. that, want with to true agents to want and Time personal Once well. brokers and us, our kills purchase as us, to Company what, business. send here closes stay is deals on about we continue our they reloaders more closing and to that, the lower is and reality referrals get how in love allows efficiently structure grow loans Real margins, us be

than We the continue to while close industry XX loans at substantially market. over is We're XX days faster the days.

client best-in-class, Our with our XX.X. service plus our members a promoter proprietary technology, proving net uncompromising at year-to-date remains team

numbers a seen bit a Third rates, and in refi is a XXXX, The future lot in QX, While reality will which gain mortgage the our be with this into shops, drop able margins what on better XXXX, UWM will our company. in post the like a QX into and the XXXX, glimpse is was little to was future lead rates sale glimpse look a of and QX the competitors heavy rising we've decent means Quarter.

Now, a media, on is -- and process. UWM I people, to that it's a negative to on positive. is very like the independent the moment with A say want brokers initiative, because initiative lot focus. Xth. been we about tune about overwhelmingly I focus consumers. mortgage on March the our to only the and wasn't not quick been everyone all-in for things clients, quick things want and lot questioning the in of talk all-in UWM of win that understands sure update make to overall The spin take that a huge announced It's decision for an

competitors dollars. love reality black spin numbers. XX%, tune need, in very UWM and course, story, of media our white clients but what is We our are to and XX the with this: XX billion and grew the to

competitors, our went was of if the to what want. whether of It's or our people it While can other successful who XX public, billion a from XXX to down billion. in discussion partner was not. not XX went Rocket network, one billion orders their or XX And spin down some is training, channel the the But success, competitors' within It broker they think it an want a are to because you non-growth, from reality of UWM's way. overwhelming that this, culture, growth and licensing. only of line from not

share our like like just and year, positive is, our one we're just some but being across they're strong And independent channel in help under for in in it with as of the look very lead decision be Quarter, wholesale exceptional and market and solid made with that as brokers UWM throughout Xth, forward the independent UWM, a client's us foundation, America. to that that the a summarize the saying future. established consumers in day, about will growth excited position, a with that all-in proud capture production partner are the mortgage was the and and consecutive more and for country, continuing clients mortgage changing broker country. by we back many the for channel wage all XXXX, whole Xth on in March to going to so was the service number Second and channel very did I'd beyond broker in brokers [Indiscernible] the of all the factor America. year Our we're overall This the

same So at. the on. of we're At a things good proud of where lot we have other very going time, we're

some Return work. now, to let's So about talk highlights. other

July June, a of Michigan. our By all team here back we of we had our members Pontiac, back lot in in So members. welcome XXth, team

more alive At XXX-acre to ever. we're X,XXX. than Our plus all culture excited is have campus,

our have coming clients We in.

office clients how coached, get their hundreds to coming have trained, get to flying every of business. to Michigan, into our grow Pontiac, week, We learn to to

a that's And UWM grow, story, part channel every big and they As will grow. single the grow, happening day. it's of broker our will and

to done reinvest on areas and have innovation we're leader estimated some to mortgage our can people proprietary that business in We've actually a the And and forward learning, excited team save company an years, excited. will in hopefully, $X be game-changing once growth and us technology will this recruiting some been Third document to document in in that our We for something you're to looking members, That's UWM. on and It's some execute things continue and committed Quarter, our we've about and been things going We're some very we've again, on, first leader not mortgage year hear the technology, the that We are innovation. done. have that we've the other We the with that announced proprietary big in people. best storage trying in built X,XXX being rolling we out. million that feasibility, before to we done. and we to some we're We're a we're docs, that generation, in to Third we've payments. that cryptocurrency remain evaluated be at Quarter. here as got environment things collaboration because the satisfy for over America working anyone accept QX, country and technology

through going take our to Matt shift, the today wrap will some not up could CFO, about with talk questions. of that before this call, financials our stuff, all and about available I details Now, Forrester, for but go mentioned, Tim our we and I'm as and financials be

with like I'd start thing, our First buyback. to

filings, but by As Directors buy the details we a authorized were to shares purchased in back announced the quarter, last exact Board lot QX in our summary, and we more XXX,XXX under shares since. of on the in just

wasn't more If these you back, more, big X,XXX,XXX have a all honestly, float even it, -- concern more buy our buy and but purchased float, at and prices, aware continue to our we'll add why back the the investors' it we we even and at issue shares, we if could more, deal, at than look of are just well we we that's authority very time. can't shares and obviously to about buy this

we'll MSR XXX However, really $XXX we comparable is rather than within remember, of that highlights, opportunity reduction million do last fair so, do MSR, XXX continue accounting for when million, to have to net reduction that do placed and quarter in of revenue the ability million revenue, a was there. and so value of But year. the just our change expense. QX

a change. really to million it's So $XXX difference there

our overall increasing was growing filed production due over periods. volume, higher prior Our and our income to substantially servicing that portfolio income interest

instances but production we remain billion which in per than remained agencies, fair on XX.X entry from value the over a market readily equivalents program, our June has which than about On is year-end years. to the at as prior the as longer is success—doing at loans Loans sold agencies, balance due increase of to Mortgage liquidity certain the markets remain through are billion more cash front, garner jumbo two been selling execution fully of X.X the sell loan operated hedged loans sheet XX. into This in production, better month. cash a billion-plus renewal a through overall significantly our and of dollars, and bit billion PLS that with marketable. huge than private on the well

our The from X.XX%, you billion this our way something as risk billion and billion, support average strong. over It's from quite of prior encumbers XXX.X from XXth on unpaid billion. XXX.X evidenced believe authorized note A billion, on of by line X.XX MSR was our interest benefit Credit weighted me, fact extinguished any of quality a business. MSRs, to is which in a value I is seasonal Board quarters. credit the and is Directors record of compared fair MSR very has to service in to Delinquency $XXX as closing debt principal increased X.XX materially, perspective. months, The dividend in an X XXth. has So -- our from as over balance billion increase net increase X. see be further the originated added Xth. increased the our In -- issued days our income, per profile September call, a approved over book on the XX last in as can to mortgage roughly our QX, rate of investment that excuse June X.XX% portfolio prior XX of rates $X.XX quarterly noted X.XX%. in paid young on The share down XXX we to October shareholders common stock business to well UWM

such But is from points. Our basis don't This talk to XXXX. that about. want key improved that's to from loan XX up -- costs a point $XXXX people about per data

our even pressure proprietary So our around profitable of gain to quarter, put and and as second and them we low in with about originated cost technology, across in competitors on because to saw excelled same to technology. some points, continue competition, our in volume, in going our our XX money, the board. all you the These can is XX time, at we our and we're our markets. most succeeded lost And the down cost, our profitable with our sale and cost all and continue we proprietary went when of of of of as can margins, very we're on win all-time we in are talk be basis basically, originated win cost

Now, not exceptional we across Last place put set did realized of higher very it We guidance. Quarter we also record-breaking board. we we results. in and set guidance, at number's producing solid foundation set And and The only UWM, proud it, beat as but we're it. the we

and our strong, We're is getting the channel very, proud and members, strong. doing. what platform, team it's they is of broker and UWM we're all Liquidity that our we the technology doing what Our get going the a to is stronger, in matter and make committee. The operations, we're very impact big consumers as and the serve, well. to stronger broker to continue for Realtors, as on continue channel

UWM. the UWM, points we're And we environments, is guide win One the continue of else basis to excited quarter, everyone production take you XX last to the about a struggling, We're I'm in XXX between to excited third points. margin I with to billion from questions. going XX profitable very wanted to in one very, and XX and leave margins, looking the of we market at were here won. and ahead, perspective, and, to gain we're [Indiscernible] We're toughest in

you turn results back our about playing we to any have going going the and questions I'm second-quarter over So forward. market take guys it to see or you out mortgage UWM how and

Operator

like a in At Steve I from Instructions] question, Securities, ask would to this LLC. remind first [Operator comes JMP everyone question to order line of of Delaney time, the Your

Steve Delaney

afternoon, and say what, than that impact it need Thanks. on quarter. was on constricting lot us, -- generally we going I had didn't of everyone, or a we actions ongoing guidance you're markets terms pricing but to it the others, of this the with and Thank strong. just and to call really for heard there with reason management get you lot share guess, clarity, could was at welcome, Fannie. you and I for business guess we going capital you how I terms you. a how May heard we and there, on do -- had may GSEs XXth of less you changes. one in lot was it a but congratulations volume the one beating meeting in It would much for could this on appear, is obviously of Good of other of your a that Very Matt, or time pipeline what on much impact know Freddie be of

Mat Ishbia

for the Thanks question.

everyone be you. follow-up are handle to week; for available for or hear this next questions want First his you there off, I that available week, any any will financially so knows, he's can't Tim Forrester perspective, if questions

thing happening compressed of cost growth, so way situations. but really important prepared some Mac changes, and companies as gain do with on in have control sometimes of and more sale, some Freddie a to known some from are know happen, our for in that is So a and be he and specifically, to look this how get reality things to lenders, in Fannie us becoming to what I happens that competitors question originate, that on that see at and market the the obviously, you also way, consumer is a an on talked from changes all. a of opportunity these Fannie best always I takes one, But in most a Mae. is and strong those There your even that gives available. business, sometimes, quarter profitable about we answer spoken mortgage. and there kind other it and I Mae think quality wholesale what this: retroactive for and like impacts at positive way this won't we're Obviously, types also the our there's things all and about that's be I so positive our it's things retroactive. can't that really see or the more

or to the that mindset places that's legacy, that future. said, of around some with the of around a some a the of legacy, so in near right take very the actions being going we wholesale pricing these are thing think lot be And past of or the around brokers the if way,

a so report? a process, join adjusting many best Now, to but through of as does independent know channel markets to I all of Everyone and mortgage going in it's the and get in people third-quarter because broker, that wholesale trying and we are brokers industry. strong a mortgage way that it's channel. know, are that the other an mean to the aspects mortgage the -- happen lender, the the people do are the future the a is -- that's through quality sees to such why mortgage wholesale don't

where some think And the might the that of so talked and one all too. day we legacy those in think about they we'll up happen recently, and money that our of things way, a have be quarter some of lenders talking I other have positive will reversed picked the sudden, and then it some rules a imposed on GSCs I got are and short-term,

Steve Delaney

in defense. time, and about that. like release, keep Thanks doesn't forward. today, follow-up it a that but $X.XX trading on press just the nice quick like they including Whatever did, will look, third some it the just we'll where sound the Well, comment. interested. X% That's for puts in guess And stock definitely people sure. dividend I is and hear what the for a moving I quarter you it keep it one over yield, think I That's a year. all

assessment? the it's this dividend Board the Third and least but decision will the both, allocate Quarter, look, dividend, you capital quarter, shares. a was in -- that But also, to I the Board quarter paying shares. is more make unusual it's about it little, on let paying Is like others completely board change -- buyback, on doing its that buying a view be the and I So talk not every to somewhat shares. a be possible, a the guess cash back buying think concerned company and the would more looks maybe dividend little back not it's may fair a the hand, Do for I'll one but a at for it's

Mat Ishbia

The on the to shareholders, that single plan every dividend as that it we it don't I concern lot repay no Obviously, on a again, see for XX more reason talk this was have a to or -- the the no and I dividend. if I meeting, at point, don't advantage about right way the The about $XXX going vote and but it fair, because there's good and is Board our we price of now. million, Chairman forward. we any it buyback would I a That's pay forward. was There and larger, on it. float have the execute. to a continuing inclination. We executed of once discussion be And share months would is was approved amount taking at not

a the to you With it's well our forward. we're ridiculously yield, reward and are to high so as going to dividend, aware loyal continue of. happy do And we're way, that going shareholders

Steve Delaney

comments, Thanks for Matt. the

Mat Ishbia

you. Thank

Operator

comes The Coffey of next question from Henry Wedbush. the of line J. Jr

Henry Coffey

afternoon for and votes taking my collecting for you call here. Good and thank

to is one stock [Indiscernible]. your given challenges, return I think to aspects and float of the more of the terrific book, a how attractive It capital. way the Given is dividend it's trading seems relative the the

On if technical highly in area. I So dividend. you're favor of taking the vote a votes,

Mat Ishbia

me. that I'm use and shareholder Henry, the were same you large to and you, on with a team, agree I

Henry Coffey

right. Yeah,

item to I think that in March, was one we overall expected, XX.X. Even we lower I wondering June, G&A you all can and more than about. get and in expense I but XX.X was get -- Smaller expenses this if into it what was your item, was vote then were it's though offline million, do, than just sir.

Mat Ishbia

Yes.

can we it was but offline quarter. think just go in a on the it, I reversal first

had which item. QX XX million, reversal -- went XX on around XX, the you as expenses We it. that line actually us puts just about of are on was We if down aligned I XX a same with remember saw. correctly, So

that's as it basically and So cost have our down, originate expenses apples-to-apples, down gone overall was our well. why and has gone

Henry Coffey

other the obvious. very but it and one, direction, that was the numbers thank about just was other all in was curious I That -- moved That you.

Matt Roslin

a when there flat. was that In million one-time a item X QX, out-of-period net but you was added, line reversal is out, QX contingency. over basically

Henry Coffey

-- built, growth lending interesting more if seeing which quarter. you which an topic, a foundation a from particularly manufactured bit renewed also some in for in housing those the release area I'm began wondering assuming the time. made little in been manufactured return the the the purchase or housing. On tell more we've Jumbo, products business, you is of was government We you. is securitization, two focus the a and Jumbo Thank about that's I could comment on press second about FHA, and PLS of us lending, a and then really both quiet legs;

Mat Ishbia

continue serve looking their ways our We're at to clients help to clients.

And Jumbo product a out. so, the been rolled We has success. huge it

I think March announced came out it. on It I XXth.

month full loans at the So really you average, we it. April really, I because in $X two second of close -- to quarter, really we about get quarters a think quarter a -- did, full on middle it don't until didn't that end a of on billion product. But the

in it's and growing months July. just So under head those X my of billion, I think in X.X up the three top

product, like is, nice And The product. big as consistency and purchase, of of a smaller have housing XX% to continue want so homes, we it's They care it's consumers. is but to that purchase Equitable our wasn't to lot of use like loans the their do to and all that product FHA a good about focus process much take it quite brokers to throughout things about is talked a UWM. of just want submit nice good part way UWM. how our really a honestly, the XX%, product ours, almost manufactured big feel how it about but quite we just so was just and going be And we well, country. a

the they come brings them due. in days in They a XX, so and the the they reloader out their UWM. have FHA conventional due, XX, can comes, And they loan have consistency Jumbo know that closing XX, of that the UWM, their when loans confidence their course, and XX VA, a with a transaction,

a bit. XX.X products and billion, in of And obviously as our have well. going rounded we're so We quarter by all-time a to record little out year we our history are lot biggest company

fell the rates focus, to value our tad once the till great lender and off, everybody with And up will ticked only not a of continue UWM products a these and Wait great show see the up to you'll become purchase And is else investors. our just not slowing will returns bit, or a market X.X point, of but at number along down. and one tick again, and lot a grew. gains rates overall growth so, UWM we share and

Henry Coffey

is a yard has someone the ability housing on and give the of Given very house housing security, because a it manufactured plays role housing Fannie with group Mac the it us in know been in, -- housing how bullish and in affordable I Freddie in playing to and somewhat, the -- that has what's United manufactured lender from your forward? with going role what perspective, can a be GSCs going on we'll own tell you and

Mat Ishbia

with to affordable the Yes. We're become hopefully products on GSCs and product. We're to the the we less think offer to the aren't an more people. become to the more continue home And more and available housing -- affordable make going they're going market. working going of manufactured homes more to of market;

inroads it the And into we'd our sure we figured just success had processes actually we in a -- rolled get of tight. out it, making we in make it, so in good mid-April. And are lot

and to perspective of But homes still it's more a you'll commitment forward America. affordable quarter it new the in of business. our very throughout more it is see So from third of and going our Ecuador --

Henry Coffey

quite have primary, but know a us competitive what in We the The July. give environment to what the August, gain front? reasonably than like don't spreads stable can on the August expect gain in sale on sense of you secondary looks improved margin for actually competition,

Mat Ishbia

feel We good monitor can is looking at a comfortable in competition, with feel everyone. to We're that really We cost other place. play the feel are and on our our really on are. along on margins guided can't place reality we're we where the given to you we sale -- and Yes. continuing volume places But that good numbers. guidance in a gain about base the originate. We with I've really both guys

competitive becoming don't more And think so, less or I it's competitive.

of what and volume leader, margin is I are think obviously is, increase. market the compression lot drives which the a market the or that we and

we're volume, and on down. gained about million We we highly the good main $XXX way substantially, XX%, profitable. competitors of share made The in feel went market it. quarter, where so at core at, And earnings, I our of we're billion really look we're all and $XX it our controlling grew over grew our is

before is good a XXX, then this. I that can the so really $XXX see these everything make when the margin, feel to we're in where make quarters huge numbers quarter, really couple you million And you'll I And opportunities little come saw core more at. at. in a last about earnings We about of where feel big good and

Henry Coffey

and solid on Well, thank congratulations a quarter. you,

Mat Ishbia

Thank you.

Operator

from The of of question Harter comes Doug Credit line the Suisse.

open. is line Your

Doug Harter

price Mat, talk will about the of hoping think you gains in running. you following a Thanks. been could a need be word of the these some keep market share you've bit sticky to all-in for kind better [Indiscernible] matches some of in the or little how desire field lacking

Mat Ishbia

are sticky which right not. all-in extremely include or things sticky. doesn't the even we're the on Those not It's and that pointed doing which wholesale lenders includes the for that whether we That's people it's brokers. The channel, loyalty for Yes. black white. out two UWM -- is not broker all-in and

has significant you to made going build And to clients. The country. aspects significant and our where, than that's so help alignment in hey, business we're the of the we're succeed, has training, the those all with grow, your the faster there to stance. growing if your what's are continue just clients help to grow we're been give clients and for you going rest working, the going But with help channel, business, you to broker and all-in And you clients. quite of the been the across your honestly, we with growth board our that stickiness

had all-in will few that's as we companies the weren't very forward. and amounts a why great all of to grow are, majority perfectly mortgage grown, and fine. so and continue the that And partner mentality, we've in independent that's great, their going we But

of And so that's a it. big part

clients best, things. those the the really is of price how aren't great, is 's is our the for feel about volume. technology Those and best, more talking things our a Those prices confident our UWM service are driving to partnership confidence, are the things stickiness, explanation and so great, And best. our products say, our the match

overwhelmingly And helping not and with understand to work it's with where continue we're your and you they grow. also grow been they in are Let's them, only it, we can and positive business. with UWM, help resonated all it's us, but them

sharp. have you amounts honestly, because, our prices our nominal I those things? very Those margin. price so saw Do And are matching to continue with are quite very things very,

margins are good. Our pretty

good. really are prices Our

channel think quarter, X be we and of UWM. growing I to number in with best and the out the billion seeing, for our number spot. the XX gains because the And consumers, are best And of now were we're billion so it's we're spot. brokers, we broker it's continue going it's out market for substantial XX for X the And share best aggressive were to first

X, gap see a different up went if one $XX X.X So, Imagine in closing very bad. you of billion soon. wasn't whole the so to would a quarter or rates game

Doug Harter

of need following just of the environment kind to up basis basis upper the the range go do XXX the towards margin to end what guidance points then, XQ points? see you And guess, on outlook, of of XX from type I

Mat Ishbia

why actually, down. Yes, I don't and XXX, will XXX, again? going to I guided a I XX be so to XX got to I No, it I think XX see think think but so think XXX, we that's margins we do

However, I don't see much them going up either.

quarter, more of will this quarter. And quarters. the in is reality third in to guys down don't second, happen see it normalized there's not the until along on it's When And gave base where low here going which averaging quarters to off fourth you could think mid-XXX in to far range right for not are you normalized, It X it third, that our happening and fourth, see opportunity going lower at the overall to to But I and end comes is going numbers. that believe low back this: the gets the the with between And it's to long. it X the very the these be quarter. but back I we quarter. so, year, not as you stay foresee as don't But I in think now. be And first lows. last margins told quarter, I all-time it's I be

think go at And how the the of we so into shareholders, we same what Company. to think grow it, we there's to vision and how a best that goals about our price, lot of way the market dynamics taking while continue and and and on and share to time meet deliver value our

Doug Harter

Thank you, Matt.

Mat Ishbia

Doug. you. Thank

Operator

from Ryan line The line Sachs. of of Nash comes question next The the Goldman open. is

Ryan Nash

guys. Good Thanks. evening,

Mat Ishbia

how Hey, are you?

Ryan Nash

group. see eventually when Big margin, picture, don't gridlock others a quarters, And like Matt, think guess. at to what Good. quarter, this of can quarters, than at about do to peer we next I little just in for so four put to us lower it need break at margins for drive pricing to expectations some the this you then, going and two, X that to the talked X I you stay sounds bit last quarter, It the think you fact that it's look and is these the ease. levels your will for higher?

line volumes? still eventually increases margin is, question price you a with drive my also hold can but achieve as and the in volumes on Thanks. others, So to

Mat Ishbia

lot. a Ryan. Thanks Yeah,

off, our are lower margins not anyone peer group. So first my in than

able profitable as at It's the margins really We know, who well those be, page. numbers. are lower as business, actually So, match substantially below broker was Point, us they you broker than book. on and mix be their same not we're Rocket you Home and their to know. and ours. not partner would

data, them. XX south However, them kind plus XX. all of together. margins margins of well not they They're points well around they basis are affiliations, right or wholesale Their their have XXX jumbo on whatever call they And basis XXX points. our from

it, comparison. put to an just So apples-to-apples

see we the shrunk. be, are grew, that what's that since they get businesses, across board, that's the And and substantially to couldn't can than have they going the they better other is, be way you'll priced to leader, lenders And so we all us. happen

to You're that again. going see trend

they And lower. still Home they Rocket, be both was substantially lower who lower, declined. and so substantial substantially point Even unless can

not and purchase strategy so on along sensitivity our gain with And focus strategy. as is there's the around there of business a purchase differentiator. combination The a big on sale, business they Price purchase. points, place what, on on much even lenders to were it. X a price no was can't Brokers certain if And you because making XX actually matter deliver. purchase basis won't your is

go compressed, telling everyone depending where to maybe billion XXX, Wait That's less us. rates they to rates doing business, below everybody basis why did that's points. up be points. going will everyone basis everyone keep else Margins when exactly and up so And billion, crazy. be XXX everyone went $XXX well And $XXX XX we're when went till on are, struggled.

about loan on And so cost originate we structure. we're our at. margin, gain feel sale where No a can great at one

it Other a will be get record volume had places bit we got in little concept our the to we're successful. decision so, And to the better was for And I'm type all-time it going where shareholders. bit rates a them. technology will to and going in And we I to whenever and and better see quarter use business an proprietary quarter, little leverage our as that. as be quarter, will our again the second enhance third right fit because continue that similar for use

is 'XX quarter-in, UWM it and prove most the or up, So they shines, with XXXX so. going plan everybody the is quarter-out. you're what a can a sales feel or were into that's quarter or ' WM Ryan why There when good and just about to Company rates for reality and glimpse was U to when to strongest like see QX glimpse, do is else, mortgage that's we and look back going 'XX a elite it. But go that

Ryan Nash

to think Thanks think rationalize to you and I quarter it. in a said the as go originate to investments expense X,XXX. had guys going just cost technology opportunities further to for And that think you've X,XXX do the Thanks. then expenses? side. I you nice business you could guys from you Got about made leverage the you Can Where you color. on about continue the down developed? talked talk the that you've I'm maybe curious.

Mat Ishbia

drive competitive people to right lot of don't basis a further of a there's that actually that's huge, lot think key working that that down. real to a number now And I things is is. points, part recognize even a XX that It's that on advantage. originate huge Ryan, whatever Thanks, Yeah. we're cost

mean does that see, We're the to quarter different technologies were after next wait up Now, in it quarter the or doing going rolled out. we that? will show we next but and that

And opportunity could of there. feet, d million. X a million to how which miles, us $X others add a we that's of those say couple One year. up was save I win. There's that to up all X add them million the spoke A and inches year,

every on advantage, lot UWM. every is things, here, not competitive confused There is day are of which but about we our technology. inch a focus we So our

which but It technology elite. well. originate, elite Our our our is makes a cost that best for And in is the big clients It too. difference. as is to only internally country, the not drives

but you America, these when future. regardless it. places as little a that originate, to And and But of up go costs. you isn't struggle to fixed little them and you you that so all bit cost pay volumes great, have for, a different going you lot bit to a are everyone know of in will They can have look that is when there's We your good out to a infrastructure, they not have bloated cost see will originate more, because and throughout rates different bit. see choke don't locations little the

Ryan Nash

Thanks for all Matt. calls, the

Mat Ishbia

you. Thank

Operator

comes the question of next The from McJoynt Thommy line of KBW.

Your line is open.

Thomas McJoynt

guys. our afternoon, Yes. for Thanks taking good questions. Hey,

to levels? signal your able bit to production, a be the As X,XXX. up Is continued a market normalized you to we've amount seen, team that guys member to when have after now dollar you continue moderates to headcount the grow the of more to even add expect that about

Mat Ishbia

team our in Company. thousand The great hire Nine depend continuing around question. and reality the we're have to families that joining for not a we're are people, aggressively. think proud of we and position team that lot us, we many members got thanks members, any we Yes, concern is that pretty on of to

I right? people don't the X,XXX always we're we're some that people from of -- year. going happens, size have that think not XX,XXX Now to this attrition at And you go X,XXX, so to

more and believe, or we this So we I've after that mortgage in year think that. I year, America, And might whether only the number X will before, become about it's year after, feel next stated good -- really overall company the the X,XXX where handle I better we're add I volume. with technology between people same and to don't have things XX,XXX we the We our to more right headcount at do now while make volume to continuing actually can need the time because at and efficient.

And so, stand do we're more to today. able we as business

the not accounts really going team And member growing be to good aggressively, spot. we we're so but feel a

which of our our is them a is And don't expenses, much XX% think we so about members, going tie to costs, that see I XX% team where be which today. from up are to going

Thomas McJoynt

a different then And Yes. topic. on thanks. Great, just

looking increase, interest to longer to held obviously times. just the significantly attributed saw over from partly that for And and what the income jumped pretty X sale the the billion quarter balance can hold see loans period sheet, you warehouse at you XX You reasoning facilities. billion. just are if that for s. and period And noted also longer increased you post-quarter the some those time the then, all funding interrelated I of kind see want temporarily is to you hold end,

Mat Ishbia

for Thanks question. Yes. the

out income's And so tied interest to that. there's opportunity Obviously, there. the

sense. makes that So

have Freddie to loans You Mac, got didn't efficiently. programs go right. with them. for But to not always Fannie We been very so could opportunity that our the any Ginnie Mae even that efficient us, selling we've Mae,

have prior we So, to jumbo back this. didn't then

were that And PLS accessing. market the so, and was then something we not also

of process can in done Now, aggregate can where and of generally homes to market, the loans; have we so couple same sold. a billion actually things And that to play. those dollars which to have investment be arbitrage we profitability. them actually deals they directly take we of aggregate just in More That month. go time, the hold and we market out the the have couple we're and have to an GSCs, longer takes We've although properties, hold pick the can [Indiscernible], is a jumbo, in can all a also second are then, we PLS where some we at those out.

up we up. or where pennies XXX,XXX of interest lot there's pick quarter, That's pennies, went speaking can gain business. them the in what a adds would but really so loans whatever different is, of the income spots that are the people a And of. response of think arbitrage times a it month our There's on one lot Not margin, only by XX,XXX little some you're on in sale. number pick up a loans up

so And opportunities for those us. are

up, and some the one that of that, maybe at and look them we we gain at you can have looking saw we are income great on financing these capital market of these a so private-label securities. arbitrage inches of the and all pick was and interest sale on that And some on on

Thomas McJoynt

I appreciate great. [Indiscernible] Thank that

Mat Ishbia

Thank you.

Operator

Next line the question Instructions] is Jefferey's. comes open. line from of of The [Operator Carr Ryan

Ryan Carr

good question. Hi, and afternoon, guys, thanks taking for my

volume capital all-in a you'd the initiative. of terms the in returning; respect really is being had momentum that lot following First you've able expand the to and of expanding progress with to have purchase

dividend from where buybacks curious between in you priority of that and and your the is maybe thinking where making kind are reinvesting Just in the about respect. a business going decision forward standpoint

Mat Ishbia

Yes. Thanks question, the for Ryan.

think low right the it's dividend business an as to and the planning the on business. the has based going the our reinvesting a way earlier on very That's to strong, right returns off, now, for growing I who's the continue. that continuing stable reward stock yield how to we're that to Then on shareholders because we're And price anyone and investors. of sure loyal main as capital, amazing first our always it's in the great we're focus going buying we're mentioned of, proud our we of So make is return I business for there's stock.

a now, right don't that's I I once on great float again, of so well. the the buyback, the lack opportunity now. And all of because can levers And as have

on I get figure price, less. think so float that's how actually have there, some and to stock of our the out drag I not to more

majority ways I'm because provide to roadshow that's I something therefore, to out people creative being very looking help -- provide as float told at float different that would market. And the I, figure to and during I'm our more so, ways, owner, all obviously, more very the

so, I'm on that. working And

prices going it's a shares And $XX I $X, kind like able because buy below be it's a to maybe so, to at to shares they lot counterintuitive And at back are love below buy I right back. even where of now. little of love

cognizant said However, in of I what have to flow I would do. honoring the be I

are our scale. what done, float at ways -- to in and our we'll to So provide And at a we're at we've to get going to dividend as technology. is invest and same out in investing looking business more as shareholders. creative in looking the market, we continue pay we announced. all continue opportunities we reward around to creates differentiation different time, a and we're in the business always to major It continue But grow moat the

Ryan Carr

forward, and the in do growing forward, frankly, the business have makes seeing the That you're going sense. perspective, kind of to in going balance think of the going in of the play that, into to in, the that was a going these of success cost savings margin-wise? Got also we've for of really from kind environment savings But the it, invested And that When million the especially of it. especially investments from a mentioned in we're X lot a you really very expanding some seen that this how going year. point. quite you the release off amazing, growth this given you

Mat Ishbia

million it's the on know but couple small, the is think here, is, sounds thing is X huge, does add million I big and there. And going be but of up, one couple that the gains. to I so that efficiency a on difference stuff actually is the a

some And to our members. building team technology so, have proprietor we That's going we're ins house. help

increase. X% to continue just increase X% of to Well, Let's hire have means members, say don't to call conservatively team our We'll grow. as to XX% it. which you to much XX%

team we'll doing. billion XX not difference, a do have So month, hire our call do of That's XX above exaggerated; a big month to billion instead a more with really billion's XX% And little people. we and could now it a right we're maybe XX what right? potentially maybe in we could

So we'll now billion comfortably at UWM. call billion, right to XX it XX

technology our they gives And does someone's And everyone Well, them close us so because the huge, technology. to got know upside, huge people of because take don't you technology. that is says a our it great got how days, great whatever great cost We're at just recognize long way And technology it at at. a sales everyone XX, you or and loans? those factors XX, that the then a what are if determine is pitch. XX originate. really two they're it's else And have whether

And so, people. be costs and we're basis this our that going to we on about pressure hard put It's where help drive really going feel want it, to good really compete work points. it's in so if we to our how we somebody us with and with and play going really can technology to for XX

the not Now being to nice ability we're this make is to mortgage able highest we the going biggest where on sale on the the to business. company And good with But again not margin. market We compete planning grow doing about have but level the anyone best only at America. being that. and feel in

Ryan Carr

anyone this have half in, the of point, sees how do in what of the say I why question you kind demand and where consumer on quarter? -- -- saw where a at would kind at last and like second the and are do see the curious for what come they're to the we and in of given you volume you at visit that point the did Absolutely technology, agree. you just at? And through think on Did the see would least month, Final built pickup of throughout in me, this demand it's quarter. they side through rates just trends hear that ti to kind brokers, momentum back they the comes rates to in a

Mat Ishbia

demand. huge see We

know people people And houses lot like there inventory's inventory's So And to yeah, major a are but will I tight. level of now. it's a tight, at major, buying the the say right out there.

quarter UWM I this $XX seeing one in I quarter, you XX quarter, we billion said was first year. to the the the the think ever so get in if And that at billion purchase guys of maybe

those is, don't to the to close brokers. are seems billion, and fast brokers and Because so And other massive it aren't local, those going it brokers the go demand, lenders. seeing XX the want are the loans They efficiently. people because other to key the get people realtors,

quotations the reason the that's we in And inventory so the when inventory continues like good the that's reason had quarter. is a grow. And reality to as why purchase why not pretty

every provide? do have we [Indiscernible] But constraints. people day, buying does could the homes out more could more, single Now, You are we not there and inventory but

days XX take they get informed And an out away it XX which our broker borders which grew XX in purchase hey, say, houses, our -- However, many bars getting for to a business so constrain there business for thinking purchase We is they're sale a and that and get contingency. if the offer does being in our XX, is us, in selling appraisal from that's cash fast, why doing brokers business lot, houses days, the And because are you people that that our more only second closed to no from because or can We're quarter. contingencies giving XX, big are offer. not days. offers, successful business. you grew close that differentiator they're they're getting overall

Ryan Carr

as thanks, Matt you, right, the quarter. congrats thank and well, on and Matt, All Roslyn,

Mat Ishbia

Appreciate Ryan. Thanks, it.

Operator

Michael from The is coming Kaye of of the next line Fargo. question Wells

is open. line Your

Michael Kaye

wholesale industry. in up the Pick competition and

offered broker -- rates the proposition channel with mortgage would that lower value to that seem You to of enhance consumers. still would

months, the that data. employment views employment look When over wanted to on at of have been when surprised industry you is saw poised stalls mortgage to out I've access hear growth, confidence broker market why and somewhat the your slowed, So we think last you growing? mortgage I continue I couple do employment broker is broker

Mat Ishbia

Michael; Yes. question. Thanks, I the appreciate

that guarantee sure around It's what as lower last because you -- stuff. pricing kind on on the [Indiscernible] alone loan point a officers, loan but have say me. in have means margins actually as when a shop infrastructure don't rates can't to good I the they're doesn't you those about month, know in is the the So It talked astute models, find have their having loan job, us are sale going the I'm models. -- that a next of brokerage of zero broker in a officer retail perspective shops, to stop XX our leaving mind in the pulling to, hold. shop is no America intention X data officers latter, the the and the me cross X even broker from visiting channel my are the X retail. don't calling own have the which and I've data here competition, thought. speak almost relevant growing, just but reports The I they data loan loan all a [Indiscernible] have independents; I like rates and confidence out retail that even Michael, sitting the that thought broker not personally mortgage that XXX is where strategies up my the the are Those of to actually -- zero on of It months, labor those branch say, a and growing, brokers the and any data models on very is started employment I I but but starting isn't up. is officers a down And have offering is we problem help higher which data one is have it's margins reaching long. question gain as really campus. that the that, to of fairway because I'll retails the the at top XX companies all last depots rates, right? go lower reality caliber won't reality happening. consumers I up, are those in lenders a dinosaur is the dinosaur don't nice here, that they I to [Indiscernible] know of I it's do think know talk companies I

officers mortgage shop loan is their listen, reason quarter-point my commission could [Indiscernible] better I an a to I or be more The retail offering a offering rate at full. move. saying, be so only can't are that hey, independent higher pipelines the consumer don't making move broker; while I this want they So, are rate working and as

to my rates right so man, like, messy pipeline. And XX down, from now. loans when this I'm walking move. got go away I It's it's in not

And pause so more quarter, is, early differentiation out. quarter the between so retail second only more likely lot pricing that, that is wholesale, it a people there but what the Rates second wholesale got quarter of third the we reality saw and the that will little a on end of in officers at the in these loan better reaching that and channel. to our from the retail the grow is, and pricing migrate people

XXXX, X to by the X XX% so out going brokers of And or happen. that's being mortgages

are that making We happen.

officers working transitioning loan are a that. is We and of with them the big part

Michael Kaye

make that lot a Banks, of banks, sense. and

but I been you to I to slated expire it That's question more extended second wanted perspective The little I touched bit, in June. promotion originally was matching believe a you that get have. on price that multiple times. on

of help an broker you way a How or negative rather to marketing more sale this again, margin it your on of is than actual end plan extend math, utilizing actually this you once account do is clients to broker the the often Thanks. think from tool And this I August. execs lastly, again? perspective. see do

Mat Ishbia

for Thanks the question. Yes.

if not I so, extend And I'm once gonna have it again. decided

question. So, answer I is on that It gain to a prices I'll big yet. it drag made not the our very negligible your reality call not good. have is because the sales on decision

confident. are Our brokers very

about UWM. using good feel brokers Our

the confidence have salespeople Our to call them. out go and

a couple And much And why of continued it It dragon. I've so that's it's really it more extended times. and of a been has of positive. not been a

if it UWM business. be to happy something it. if see as build we to there's to then growing, our Or And at grow and to doing mortgage And growing, has business we're value the if else if our we is continue growing. they're look continue help continue and so look continue at brokers our to it we'll their shareholders

Michael Kaye

Matt. you. you, Thank Thank

Mat Ishbia

Thank you questions. the for

Operator

Deutsche the of Bank. next line Kalucha Sameer The comes question of from

open. Your line is

Sameer Kalucha

Hi, thanks my for taking question.

you on investments change process it is it closing what more provide period launched software. and management talked that. efficient? way? make the how technology, that? more the QX, second, in wondering You does of document you in And Does the if about the any impact proprietary I could color in And was

Mat Ishbia

out not made basically millions will I we but different paying is for we a monthly bigger. our grow, the only clients you're Yes. is there, for that about just of continue them, fee. paying us I of our as it. example saving the because savings. for And -- we're it's little for It's used we question, that mostly Thanks because it couple The It's people it things there's a -- think anything. clients, that to example for on one internal way Sameer; members, one-time monthly internal. a spoke it does our of a our because have it better be dollars, not we're our the a made if team multiple are will those bit call but These -- and savings more today appreciate more made earlier we one a agile actually the little way just taught but saved built savings And you vendor, speaking system efficient, it and affect of continue. it basically proprietary, we an

$X estimate. low think the I million is a

impact our trying are know an make in on the does We efficiencies be too. just work on that not put to the place only line conservative. but we bottom But technology we

Sameer Kalucha

Got it. Thank you.

Mat Ishbia

you. Thank

Matt Roslin

question, operator. one We for have time more

Operator

one Yes, we final question. only have for time

Morgan comes James from the of final Your of Stanley. question Faucette line

Your is open. line

James Faucette

resonate. you share be Is you brokers itself, very glad go I your idea in I'm the wanted those then broker relationships. any and at much. to other it'd think better U.S. incremental doing And of the to of better sense as channel able and potential wondering whether you're around, things. of as Thank couple should the your wrap to that operations. here. you or the of back argument ones may kind share wondering to even the about some I'm if, brokers, kind there that of I'm up first, lot. up secondly, if are direct could of own or a where or support investment areas growing service, and a to think advertising with the But I Thanks and you the that brokers things beyond cases, brokers of that add be pricing to other to in some even their be look growth these or new mentioned, set support

Mat Ishbia

Yes, thanks for question. the

be the think we're because XX% but on the out So of come will QX. to market soon, numbers I north think I share, our going well -- in

up think three about top or down, all competitors the you four and went ours of it, If went we substantially.

UWM weren't being ballpark we're long surprised because of on same the They And well at so delivering coming choose technology, at will be our into growing, we with prefer us. I'd service, our price be the brokers to all very as if years partners. in time work as and the the 'XXs in while XX% that we and great

called them build how Now we We side, have website partnership on grow? obviously Please the help can a to helped More. continue Find broker.com.

in. right can that's call and area day, every in where them we - in, call also people consumer. to that They where in a their them local us phone We -- brokers the a that help have to they number call where consumers we find broker broker of -XXX warm can person actually a transfer community

consumers, I'll you educating it on can if because to consumers it's get reality and want cheaper. and reality more things so are grow. faster, there is more marketing can continue But more this; me going guys help But is and XXX%, ways brokers three on doing easier that through. to doing it's One we're and things, right more it's and you we're the And is we is the side. the help will, [Indiscernible]

for deal for to fact retail better going go consumer. data. I'll to large lenders. So want say. consumer say be the opinion; of the an any cheaper up it's, It's XX%, say through I with whatever me But It's broker go a a not to correct. you XXX, backed through than it's won't That's these to that's factually a

from big they it's have consumer. last piece pricing. best many reason earlier happening second refer out is They loan realtors, rates a and I is when going places, they warning fix they're officers. Because They you and who talked happen, obviously, so Well, best because people these our then up those go and We The really And that. about their right? certain they're just in will LO, close only there -- in are right who little won't That's was of the bit educated, thing places officers and want a in done why realtor because happen? the because lot are It's it's of only loans lot find a refi can't call a loan for busy fixed migrating quick. loans so know for and purchases. to lenders; Why difference wholesale you second leaving they And business. not their can retail that. we've wouldn't know And now the refinancing that's that doing a they're servicing pipeline. to the that's going not book. it wasn't how are business and retail

tick rates over. a see when So up, major migration will you

thrive. to proud move independent them. brokers, rising be brokers the lift boats, will in will a things positive for way and these we're help to all all grow all the part a that And of continue channel so, and with will tide And and

questions. I your for we're it the will operator, so, you don't going all if I to Tim questions. just do, talk to to available want And that's turn I anything thank all if want Forrester to you before but think the about be -- know say I back else.

always results I my and for our share here Matt talk you Thank the to think Investor again at I available Relations Roslin, the record-breaking to after quarter share but is as and the UWM we're support, for here we're answered glad everything as anyone needed, to and again. you you excited EVP But and well. third time. another guys, we appreciate quarter

Operator

This concludes today's call. conference

now may You disconnect.

UWM (UWMC) 17 Aug 212021 Q2 Earnings call transcript