United Wholesale Mortgage has launched a zero-percent down mortgage program aimed at first-time homebuyers and those earning less than 80% of the area's median income. While the program eliminates the need for an upfront down payment, it raises concerns among experts about potential risks, including homeowners starting with no equity and the possibility of default if home prices fall. Critics draw parallels to the subprime mortgage crisis of 2008, though UWM insists that current lending standards are much stricter.
Pontiac-based United Wholesale Mortgage reported a net loss of nearly $70 million for 2023, attributing the loss to a fourth-quarter deficit of about $461 million driven by a markdown in the value of its mortgage servicing rights. Despite this, the company retained its position as the nation's top mortgage lender by volume. UWM's CEO, Mat Ishbia, emphasized the company's operational profitability and highlighted its achievements in mortgage origination, while its Detroit-based rival, Rocket Mortgage, also reported its first full-year loss. UWM, a nonbank lender, saw a 15% decrease in total mortgage originations in 2023, but set a company record with $93.9 billion in for-purchase mortgages.
