If you happen to’ve seen commercials for “Mortgage Matchup” currently, maybe throughout an NBA sport, or on the court docket itself, you is perhaps questioning what they’re all about.
That is truly an fascinating query and reply as a result of they’re an organization that doesn’t work instantly with the general public.
But they promote on to shoppers on a regular basis, which isn’t a quite common association.
Additionally they occur to be owned by the most important mortgage lender in america, an organization referred to as UWM.
Fortuitously, I can absolutely clarify how their enterprise works so you can also make sense of all of it.
Mortgage Matchup Is an On-line Mortgage Dealer Listing Owned by UWM
- A web based mortgage dealer listing owned by wholesale lender UWM (nation’s #1 lender)
- Means that you can discover a native impartial dealer to work with to get a mortgage
- Utilizing a dealer is the one approach to apply for mortgage with UWM (can’t apply instantly)
- The web site additionally promotes the mortgage dealer enterprise mannequin vs. going retail/direct
In a nutshell, Mortgage Matchup is an internet listing powered by UWM that lets you discover and accomplice with an area mortgage dealer so as to apply for a house mortgage.
When you arrive on this web site, there’s a area to enter your deal with to “discover your native dwelling mortgage professional.”
However what’s unusual is a few of these specialists could not even work with UWM, which pays for and maintains the web site. I’ll converse extra to that in a second.
First, let’s speak about mortgage brokers and wholesale lenders.
The massive distinction between a direct lender and UWM is that the latter depends upon mortgage brokers, that are third-party mortgage originators.
Brokers don’t symbolize one lender, however moderately have a number of lender companions the place they’ll ship your mortgage.
A mortgage dealer acts an middleman between dwelling patrons (or owners) and lenders.
Their job is just like a mortgage officer that works at a financial institution, however they aren’t captive to a single financial institution.
They’ve the power to buy your mortgage with all of their companions, then select the one they really feel is the most effective match.
This might be as a result of finest pricing, the bottom mortgage fee, a novel mortgage program, and/or the lender’s capacity to shut the mortgage on time (or in any respect!).
A great analogy is an impartial insurance coverage agent, who represents a number of insurers, not only one firm.
These brokers can store your fee with 10 completely different insurers to seek out the bottom fee and finest protection.
In the meantime, a captive agent who works for say State Farm will solely have the ability to promote you a coverage from State Farm. That’s it.
So brokers have extra selection and the power to buy in your behalf, with out you having to elevate a finger.
Who Is UWM? And Why Did They Create Mortgage Matchup?
Now again to the proprietor of Mortgage Matchup. As famous, it’s owned by UWM, which is brief for United Wholesale Mortgage.
Because the title implies, they’re a wholesale mortgage lender (based mostly in Pontiac, Michigan), which suggests they aren’t consumer-facing.
So you’ll be able to’t go to UWM and apply for a house mortgage instantly. If you happen to tried, they’d inform you to discover a mortgage dealer who’s permitted to work with UWM.
Whereas that may sound unusual, that is simply the fact of the wholesale lending channel.
In contrast to retail or direct-to-consumer lending, the wholesale channel is B2B, so it’s solely accessible by way of an middleman, particularly a mortgage dealer.
UWM additionally simply so occurs to be the most important mortgage lender within the nation by mortgage quantity, beating out its closest rival Rocket Mortgage.
Nevertheless, in contrast to Rocket, they don’t do any retail or DTC lending. It’s wholesale solely, which is definitely fairly outstanding given they’re #1 within the nation.
However so as to drum up extra enterprise, they launched Mortgage Matchup to form of prolong their attain with out coming into the retail channel instantly.
In different phrases, a shopper can go to the Mortgage Matchup web site, discover a dealer to work with, then apply for a mortgage at UWM.
However provided that the dealer recommends that they ship the mortgage to UWM. Brokers could have a dozen lender companions or extra, and will select a special wholesale lender.
So there’s no assure UWM would be the beneficiary, despite the fact that they’re those paying for the web site and the promoting (which might’t be low cost).
Nonetheless, UWM possible hopes to get an honest chunk of this mortgage dealer enterprise in doing so.
Simply be aware {that a} dealer itemizing on the Mortgage Matchup web site doesn’t represent an endorsement or suggestion from UWM.
UWM Is Selling Mortgage Brokers by way of the Mortgage Matchup Model
Merely put, UWM is selling mortgage brokers by way of this web site, and not directly their very own firm.
They’re advocating for the wholesale channel, and inspiring shoppers to get a house mortgage by way of a dealer as an alternative of going direct.
There are many benefits to utilizing a dealer, particularly their capacity to buy your mortgage with a number of lenders.
This might lead to financial savings, with the Mortgage Matchup web site citing a examine that discovered working with a dealer can prevent $10,662 on common.
Whereas your mileage could fluctuate, which is why I all the time say to check mortgage brokers too, these impartial mortgage originators even have entry to extra mortgage applications.
They usually additionally are usually extra educated than captive financial institution mortgage officers, who could have much less expertise as a consequence of restricted publicity to outside-the-box eventualities.
You’ll be able to learn extra about banks vs. mortgage brokers for an in-depth comparability.
Why Doesn’t UWM Simply Enter the Retail Mortgage Enterprise?
This all begs the query, if UWM is the nation’s #1 mortgage lender, they usually’re already promoting to the general public, why doesn’t it simply enter the retail lending enterprise?
Couldn’t they make much more loans if clients may apply instantly, whereas additionally sustaining their present enterprise?
In any case, they’ve an internet site, Mortgage Matchup, and the attain to accumulate numerous enterprise instantly from shoppers.
They usually’re already paying for the promoting. So why not? Nicely, that’s not fully clear since we don’t know what UWM is pondering.
But when I needed to guess, I’d say working wholesale solely enable them to economize on operational prices, worker overhead, and so forth.
As a result of they’ve a bunch of impartial companions they work with, they’ll get monetary savings, even when these companions don’t ship them each mortgage.
They don’t should pay them a wage or advantages, nor do they want further workplace area.
Nevertheless, in the event that they maintain offering these companions with useful instruments to make their job simpler, whereas additionally providing aggressive pricing, they’ll probably get the most effective of each worlds.
And up to now it seems to be working as a result of as I mentioned, they’re the highest mortgage lender within the nation and don’t seem like surrendering that place anytime quickly.
(picture: Bernd Eckenfels)
Earlier than creating this web site, I labored as an account government for a wholesale mortgage lender in Los Angeles. My hands-on expertise within the early 2000s impressed me to start writing about mortgages 19 years in the past to assist potential (and present) dwelling patrons higher navigate the house mortgage course of. Observe me on Twitter for warm takes.
