In its first financial report as a merged public company, UWM Holdings Corp., the parent of United Wholesale Mortgage in Pontiac, reported fourth-quarter net income of $1.37 billion and full-year 2020 net income of $3.38 billion, an 821 percent and 715 percent increase over respective previous year’s figures.
The company’s board of directors also declared its first regular quarterly dividend, $0.10 per share, on the outstanding shares of Class A Common Stock. The dividend is payable on April 6, 2021 to stockholders of record at the close of business on March 10, 2021.
“The fourth quarter and 2020 overall was phenomenal for UWM and the wholesale channel by any measure,” says Mat Ishbia, president and CEO of UWM. “We are very proud of what we accomplished in 2020 but have shifted our focus to 2021 and beyond.
“By going public and accessing the debt markets, we now have the capital and liquidity to not only invest in technology and service as we have always done, but also the ability to take advantage of higher profit opportunities when available or otherwise returning excess cash to our stockholders.”
Highlights of UWM’s report include:
- Record fourth-quarter originations of $54.7 billion in loan volume, a 71 percent increase from the same period in 2019.
- UWM full-year 2020 production of $182.5 billion, which is 69 percent higher than its prior record production in 2019 of $107.8 billion.
- Total gain margin of 305 bps in 4Q 2020 compared to 110 bps in 4Q 2019.
- Reported fourth-quarter net income of $1.37 billion, compared to $148.9 million in 2019.
- Closed private senior notes offering of $800 million, ending 4Q 2020 with non-funding debt to equity ratio of 0.49.
- Increased the unpaid principal balance of mortgage servicing rights from $72.6 billion at 4Q 2019 to $188.3 billion at 4Q 2020
- Increased equity to $2.37 billion as of Dec. 31, 2020 compared to $661.3 million at end of 2019.
Among the operational highlights UWM mentioned in its inaugural public financial report was that it maintained an average days-to-close of approximately 18 days in the fourth quarter of 2020, while management’s estimate of the industry average grew to approximately 52 days.
UWM said its commitment to high credit quality is evidenced by a weighted average FICO of 760 for the loans closed in the fourth quarter 2020 and 757 for the full year 2020. The credit quality of UWM originations is reflected in the MSR 60+ delinquency and forbearance rates that it says are well below industry averages.
The company’s Conquest program grew in the fourth quarter with the addition of the FHA product, joining previously released Conquest programs for Conventional and VA products. With this announcement, UWM extended access to these low interest rates to a larger consumer base. Conquest program loans represented 87.6 percent of total production in the fourth quarter.
UWM increased its number of employees from 4,907 at the end of 2019 to 7,475 at the end of 2020. It enhanced its Pontiac campus by completing a walking bridge to tie its approximately 600,000-square-foot North Campus to its recently added 900,000-square-foot South Campus.
During fourth quarter 2020, an affiliate of UWM also purchased a neighboring 378,000-square -foot facility.
Also during 2020, UWM launched InTouch, a mobile app that provides the ability for independent mortgage brokers to navigate everything from underwriting until the loan is cleared to close from anywhere they have their phone. It also launched Blink+, an enhancement to the online mortgage application launched in 2016, which includes the ability to automatically pull credit, e-sign docs, and co-browse screens with borrowers. Blink+ is a point of sale, loan origination system, and customer relationship manager all-in-one package that UWM makes available as one of its many partnership initiatives to independent mortgage brokers.
“Independent mortgage brokers are the best place for a consumer to get a loan, and as we progress through 2021, our 100 percent focus on the wholesale channel remains steadfast,” says Ishba. “We will continue to work with the growing number of independent mortgage brokers to provide the fastest, easiest, and most cost-effective way to get a mortgage, helping even more families achieve their dream of home ownership.”