Normally, the mortgage-brokerage business doesn’t make headlines beyond trade publications, and yet sometimes, news from the industry is so provocative that it punches through to the general-interest media. That was the case for Mat Ishbia, CEO of Michigan-based United Wholesale Mortgage (UWM); on March 4, Ishbia demanded that independent mortgage brokers sign a pledge to stop working with two rival companies to UWM, Fairway Independent Mortgage and Rocket Mortgage. Independent brokers not acceding to this demand, the UWM chief declared, could no longer do business with his firm.
Ishbia’s words — which seemed to go beyond blustery bravado and into the territory of actually harming competition — got the attention of The Detroit Free Press, which reported “it’s uncommon to see CEOs of publicly traded companies call out competitors and issue ultimatums in the manner Ishbia did.”
Indeed, David H. Stevens, former CEO of the Mortgage Bankers Association and also a former commissioner of the Federal Housing Administration, a unit of the Department of Housing and Urban Development, under President Barack Obama, was moved to write in Housing Wire, “I was astonished, frankly.” Continuing, he added, “UWM may have stepped onto the proverbial slippery slope . . . In my 38 years in this industry I have never seen a policy implemented that penalizes you financially for doing business with the competition.” Pointedly, Stevens further added, “Whatever the intent was behind this policy, the effect is potentially very damaging.”
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