Earnings for the fourth quarter of 2023 are out, offering a view into how lenders did in the colder months and the year overall. Here’s a snapshot of how some of the nation’s top lenders handled last winter.
Rocket Mortgage
Rocket reported depressed earnings, with losses of $233 million quarter-over-quarter and a full-year net loss of $390 million. Its adjusted revenue was $885 million and registered an adjusted net loss of $6 million.
Originations totaled $17 billion in Q4. Its gain on sales margin clocked in at 2.63%.
“I’m so confident about our future and the collective impact we will make as a team, and the best part is that our journey is just beginning,” Varun Krishna, CEO and director of Rocket Companies, said during the company’s earnings call. “And we delivered strong fourth-quarter and full-year results against the backdrop of extreme market challenges as the industry faced persistent constraints in affordability and inventory.”
The good news is Rocket still managed to increase its purchase market share by 14%, and its refi market share rose 10% between 2022 and 2023.
The company is betting on AI-back technology to grow moving forward, noting that in 2023 it managed 3.1 million servicing client interactions that were increasingly supported by human-less chat and phone AI products.
United Wholesale Mortgage
UWM had a rocky year as well, seeing its best-ever purchase loan volume while still reporting a $69.8 million loss in 2023. This is its first annual loss since 2020, when it went public. The tough results were driven by an $854 million markdown in the value of its mortgage servicing rights portfolio, which UWM attributes to rising rates.
For Q4, the company experienced a non-GAAP adjusted net loss of $53.3 million.
It saw originations fall to $24.4 billion, compared to $29.7 billion in Q3 2023 and $25.1 billion the year prior.
Still, CEO Mat Ishbia played up the company’s progress and emphasized a stronger future.
“2023 was one of the best years in our company history,” he said.
“Our recipe for success has not and will not change and we are currently doubling down on investing in our people, our products and our technology so that we can continue to provide the broker channel with the tools needed to win. I believe that 2024 is a tremendous opportunity for both UWM and the broker channel.”
loanDepot
The third quarter hit loanDepot hard with a seventh consecutive quarterly loss of $27.2 million.
Revenue sank to $228.6 million, lower than forecast, and originations were down 12% from Q3.
The company ended the year with strong liquidity, however, and said that productivity improvements resulted in a 61% reduction in annual net loss.
President and CEO Frank Martell noted that loanDepot “made substantial progress in 2023, significantly resetting its cost structure and making critical investments in our technology platforms and business processes, which we believe position us to capture the benefits of the eventual rebound in mortgage volumes.”
“We are entering 2024 with a more durable revenue model built around a strong multi-channel origination business and a low cost, high-quality servicing platform,” he added.
Mr. Cooper
Mr. Cooper Group once again ended the quarter on a high note thanks to its servicing business, reporting a net income of $46 million.
Its operating income before tax came to $151 million, which included an adjustment for the cost of a cyberattack at the end of last year that cost $27 million.
Book value per share and tangible book value per share increased to $66.29 and $63.67.
“We enter 2024 with robust capital and liquidity, an extremely talented and dedicated team, and enormous energy to serve customers, clients and all our other stakeholders,” said Chairman and CEO Jay Bray.
Chris Marshall, Vice Chairman, touted the company’s “agile” originations unit and record servicing profits in the face of a tough mortgage market.
It reported a pre-tax income of $9 million for its originations unit, which funded 10,699 loans, about $2.7 billion in UPB.
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