CA Mortgage Broker Blames UWM for Mass Layoffs

In a public statement on LinkedIn, Jason Vondrak of Prospect Home Finance announced he has laid off 50 employees from his California-based company, and he laid the blame at the feet of United Wholesale Mortgage and its CEO, Mat Ishbia.

“This was one of the hardest decisions of my life, and my heart goes out to all of our team members and their families that this affected,” Vondrak wrote.

At issue is UWM’s decision last year to force brokers to sign an agreement that they will not work with Rocket Mortgage or Fairway Independent Mortgage – or else be banned from working with UWM, the largest wholesale mortgage lender.

At the time, David Stevens, the former CEO of the Mortgage Bankers Association and a former FHA commissioner, called UWM’s announcement “one of the most bizarre things I’ve seen in my career.”

Jason Vondrak, Prospect Home Finance

In his statement last week, Vondrak wrote that at the beginning of 2022, Prospect Home Finance made a decision to take a stand against anti-competitive policy created by billion-dollar behemoths.

“As a condition to doing business with our longtime partner, United Wholesale Mortgage, it was required of us to sign an addendum last March, stating that we would not do business with Rocket Mortgage if we did business with UWM. After 9 months of complying with this request, we decided to take a stand for what we believe in.”

“Our request to UWM was simple: Allow Prospect Home Finance and the entire mortgage broker community the freedom to choose whichever lender was best for our borrowers, or we would discontinue our partnership. United Wholesale Mortgage declined our request,” Vondrak added.

The result was a cutoff of UWM revenues to Prospect Homes as a “correspondent lender,” as well as a bill for $336,834.78 that UWM said was for early payoff penalties, according to Vondrak.

“As a California small business, we depend upon our partnerships and implied finance agreements to operate. On the contrary, my Prospect Team Members who were laid off depended on me/Prospect to provide them with employment and security.

“For that, Team, my sincerest apologies,” Vondrak wrote.

Mat Ishbia visits Prospect Home Finance HQ in March 2021.

UWM’s Ishbia angered many in the industry with his attempt to restrict the ability of mortgage brokers to give their customers the best loans, regardless of the source. In May 2021, the Okavage Group LLC, a Florida mortgage broker, filed a class-action lawsuit accusing UWM of engaging “in a contract, combination, or conspiracy in restraint of trade to jointly boycott Fairway Mortgage and Rocket Pro TPO to suppress competition in the relevant markets.”

The lawsuit is still pending.

Ironically, Ishbia visited Prospect Home Finance’s corporate office in San Diego a year ago, during which he praised “the leadership of your team and your culture.”

“You’ve got something special going on here,” Ishbia said at the time.