UWM Holdings Corp. in Pontiac, the indirect parent of United Wholesale Mortgage, reported today the company had a net loss of $69.8 million in 2023, as compared to $931.9 million of net income in 2022.
The company reported a 2023 fourth quarter net loss of $461.0 million, including a $634.4 million decline in fair value of MSRs (Mortgage Servicing Rights), and diluted loss per share of 29 cents. The 2023 loss of $69.8 million included a $854.1 million decline in fair value of MSRs, and diluted loss per share of 14 cents.
“2023 was one of the best years in our company history,” says Mat Ishbia, chairman and CEO of UWMC. “We were the number one mortgage originator in America, number one in purchase origination again, and, nine years running, the number one wholesale lender.
“We continue to be operationally profitable, the true measure of a mortgage originator’s health, while our financial loss was driven by the MSR markdown, which is a result of interest rate movements.”
The company also reported total loan origination volume for the fourth quarter of 2023 was $24.4 billion, of which $20.7 billion was purchase volume. Total loan originations for the full year 2023 were $108.3 billion, of which $93.9 billion was purchase volume.
The company’s plan for success has not and will not change, says Ishbia. It is currently doubling down on investing in “our people, our products, and our technology” so the company can continue to provide the broker channel with the tools needed to be successful.
“I believe that 2024 is a tremendous opportunity for both UWM and the broker channel,” says Ishbia.
Full Year 2023 Highlights
- Originations of $108.3 billion in 2023, compared to $127.3 billion in 2022.
- Record purchase originations of $93.9 billion in 2023, compared to $90.8 billion in 2022.
- Total gain margin of 92 Basic Points (bps) in 2023 compared to 77 bps in 2022.
- Fourth quarter technology and loan product launches.
Fourth Quarter 2023 Highlights
- Originations of $24.4 billion in the fourth quarter, compared to $29.7 billion in 3Q23 and $25.1 billion in 2022.
- Purchase originations of $20.7 billion in 2023, compared to $25.9 billion in 3Q23 and $21.7 billion in 2022.
- Total gain margin of 92 bps in 2023 compared to 97 bps in 3Q23 and 51 bps in 2022.
- Net loss of $461.0 million in 2023 compared to net income of $301.0 million in the third quarter of 2023 and net loss of $62.5 million 2022.
- Adjusted EBITDA of $99.6 million in the fourth quarter of 2023 compared to $112.1 million in third quarter of 2023 and $60.4 million in the fourth quarter of 2022.
- Total equity of $2.5 billion on Dec. 31, 2023, compared to $3.1 billion on Sept. 30, 2023, and $3.2 billion on Dec. 31, 2022.
- Unpaid principal balance of MSRs of $299.5 billion with a WAC of 4.43 percent at Dec. 31, 2023, compared to $281.4 billion with a WAC of 4.20 percent at Sept. 30, 2023, and $312.5 billion with a WAC of 3.64 percent at Dec. 31, 2022.
- Ended the fourth quarter of 2023 with approximately $2.2 billion of available liquidity, including $497.5 million of cash, and $1.75 billion of available borrowing capacity, which includes $1.25 billion under lines of credit secured by agency and Ginnie Mae MSRs, and $500 million under an unsecured line of credit.
The fourth quarter of 2023 was a busy time for UWM. The company launched it Memory Maker, a tool for independent mortgage brokers to send their choice of thank you items to borrowers and real estate agents. The idea is to leave a lasting impression long after a loan is closed.
The company also enhanced PA+, which now allows independent mortgage brokers and their processors more flexibility in choosing which parts of the loan process they would like a UWM loan coordinator to facilitate.
In addition, there were enhancements to Investor Flex, UWM’s Debt Service Coverage Ratio (“DSCR”) product. It now allows borrowers to close in with a Limited Liability Co. (LLC), giving borrowers an additional option to separate their personal properties and investment properties.
In the fourth quarter, the company achieved a “Net Promoter Score” of +86.5. It also reached 1.15 percent 60-plus days delinquency as of Dec. 31. Significantly better than the industry average of 1.78 percent according to the Mortgage Bankers Association.
“We anticipate first quarter production to be in the $22 billion to $28 billion range, with gain margin from 80 basis points to 105 basis points,” says Ishbia.
The company’s board of directors, for the 13th consecutive quarter, declared a cash dividend of 10 cents per share on the outstanding shares of Class A common stock. The dividend is payable on April 11 to stockholders of record at the close of business on March 20. Additionally, the board approved a proportional distribution to SFS Corp., which is payable on or about April 11.
