As more time passes since United Wholesale Management CEO Mat Ishbia issued his ultimatum to brokers, more and more expert voices are voicing concern for what the decision may mean for the mortgage industry.
One expert, Dave Stevens, wrote in Housing Wire, warning of the dangers of UWM’s move:
Whatever the intent was behind this policy, the effect is potentially very damaging. If other wholesalers were to follow suit, the entire broker philosophy could be at risk. Brokers that align with the UWM policy are simply acknowledging that they are almost equal to becoming a retail loan officer for a single wholesaler in a monoline fashion that is not too different than working for a bank or independent mortgage banker. The core value proposition of the broker’s promise — that they provide more choices and can select the sources of mortgage finance that provide best-in-class service and price — all falls to the wayside when they are forced to choose sides.
Forcing brokers to choose sides will reduce choice in the market and could create new costs that will be passed on to consumers. The real losers from UWM’s ultimatum are American homeowners looking to possibly refinance their homes or prospective homeowners looking to purchase a home.
As Stevens concluded:
Let’s hope this is a one-off policy action and not something that spreads. If it does, I would expect others to be more adamant in calls for regulators to step in as the consumer experience and options should prevail over attempts to steer the business.