UWM Holdings Corp., the publicly traded indirect parent of United Wholesale Mortgage, today announced its second quarter financial results, which saw the No. 1 wholesale mortgage lender in American report a net income of $138.7 million on $59.2 billion in total originations, a record for the second quarter.
“We demonstrated the strength of our business by delivering our best quarter of all-time in terms of overall production and purchase production,” says Mat Ishbia, chairman and CEO of UWMC. “As we have said previously, UWM is built to succeed not only when there is a refi boom and margins are at record highs, but also when margins are compressed and purchase business drives the volume.”
The record setting quarter also included $24.1 billion in purchase volume and net income, which was inclusive of a $219.1 million decline in fair value of mortgage servicing rights (MSRs).
Total originations were up 90 percent from $31.1 billion in the second quarter of 2020, and purchase originations up 288 percent from $6.2 billion in the same time. The company’s total equity jumped from $1.47 billion at this time last year to $2.69 billion now.
The company holds unpaid principal balance of mortgage servicing rights totaling $260.5 billion, up from $109.4 billion last year. It also commenced stock buyback and repurchased 790,599 shares of class A common stock for $6.1 million.
While the average days to close was 47 during the second quarter of 2021 according to the June ICE Mortgage Technology Origination Insight Report, while UWM maintained a days-to-close time of approximately 18 days.
The company’s 1.19 percent 60+ days delinquency rate and the 1.06 percent forbearance rate are much lower than the industry averages of 4.37 percent and 3.76 percent, respectively. It also launched FutureU, an internship program for children that are aging out of the foster care system to provide a career launching pad at UWM.
A document management software platform that enables end-to-end document management was launched this quarter as well, making the whole process more efficient and saving an estimated annual cost savings of $8 million.
The results predict third-quarter production to be in the range of $57-$62 billion range. Before results were announced, the UWMC Board of Directors declared a cash dividend of $0.10 per share on the outstanding shares of class A common stock, which is payable on Oct. 6, 2021.
The company will host an earnings conference call for financial analysts and investors today at 4:30 p.m.
“Consumers are increasingly coming to realize that working with a broker is the cheapest, fastest and easiest way to get a mortgage, and as long as the wholesale channel flourishes, so will UWM as the undisputed leader and champion of the channel,” says Ishbia.