What Is Mortgage Matchup? And Why Did UWM Create It?

If you happen to’ve seen commercials for “Mortgage Matchup” currently, maybe throughout an NBA sport, or on the courtroom itself, you is likely to be 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 immediately with the general public.

But they promote on to customers on a regular basis, which isn’t a quite common association.

Additionally they occur to be owned by the biggest mortgage lender in the USA, an organization often known as UWM.

Happily, 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)
• Permits you to discover a native impartial dealer to work with to get a mortgage
• Utilizing a dealer is the one method to apply for mortgage with UWM (can’t apply immediately)
• The web site additionally promotes the mortgage dealer enterprise mannequin vs. going retail/direct

In a nutshell, Mortgage Matchup is a web-based listing powered by UWM that lets you discover and associate with a neighborhood mortgage dealer with a purpose to apply for a house mortgage.

When you arrive on this web site, there’s a subject to enter your tackle to “discover your native residence mortgage skilled.”

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 signify one lender, however somewhat have a number of lender companions the place they’ll ship your mortgage.

A mortgage dealer acts an middleman between residence consumers (or owners) and lenders.

Their job is much 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 very best match.

This might be as a result of greatest pricing, the bottom mortgage fee, a singular mortgage program, and/or the lender’s potential to shut the mortgage on time (or in any respect!).

An excellent 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 totally different insurers to search out the bottom fee and greatest 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 identify implies, they’re a wholesale mortgage lender (primarily based in Pontiac, Michigan), which implies they aren’t consumer-facing.

So you possibly can’t go to UWM and apply for a house mortgage immediately. If you happen to tried, they’d let you know to discover a mortgage dealer who’s authorized to work with UWM.

Whereas that may sound unusual, that is simply the truth of the wholesale lending channel.

Not like retail or direct-to-consumer lending, the wholesale channel is B2B, so it’s solely accessible through an middleman, specifically a mortgage dealer.

UWM additionally simply so occurs to be the biggest 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 exceptional given they’re #1 within the nation.

However with a purpose to drum up extra enterprise, they launched Mortgage Matchup to type of prolong their attain with out getting into the retail channel immediately.

In different phrases, a client 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 should select a special wholesale lender.

So there’s no assure UWM would be the beneficiary, though they’re those paying for the web site and the promoting (which may’t be low-cost).

Nonetheless, UWM possible hopes to get a good chunk of this mortgage dealer enterprise in doing so.

Simply observe {that a} dealer itemizing on the Mortgage Matchup web site doesn’t represent an endorsement or advice from UWM.

UWM Is Selling Mortgage Brokers through the Mortgage Matchup Model

Merely put, UWM is selling mortgage brokers through this web site, and not directly their very own firm.

They’re advocating for the wholesale channel, and inspiring customers to get a house mortgage through a dealer as an alternative of going direct.

There are many benefits to utilizing a dealer, specifically their potential to buy your mortgage with a number of lenders.

This might lead to financial savings, with the Mortgage Matchup web site citing a research 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 evaluate mortgage brokers too, these impartial mortgage originators even have entry to extra mortgage applications.

And so they additionally are usually extra educated than captive financial institution mortgage officers, who could have much less expertise attributable to restricted publicity to outside-the-box situations.

You may 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, and so they’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 prospects may apply immediately, whereas additionally sustaining their current enterprise?

In any case, they’ve a web site, Mortgage Matchup, and the attain to accumulate a lot of enterprise immediately from customers.

And so they’re already paying for the promoting. So why not? Nicely, that’s not completely clear since we don’t know what UWM is pondering.

But when I needed to guess, I’d say operating wholesale solely permit 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 lower your expenses, even when these companions don’t ship them each mortgage.

They don’t should pay them a wage or advantages, nor do they want extra workplace area.

Nevertheless, in the event that they hold offering these companions with useful instruments to make their job simpler, whereas additionally providing aggressive pricing, they’ll probably get the very best of each worlds.

And up to now it seems to be working as a result of as I stated, they’re the high mortgage lender within the nation and don’t look like surrendering that place anytime quickly.

(picture: Bernd Eckenfels)