Ishbia made it clear that brokers have until March 15th to make such a decision.
Ishbia specifically accused Rocket of trying to take out loan officers and pay real estate agents to bring clients to the Detroit-based lender.
For their part, Rocket executives deny such allegations, saying Ishbia’s move came Thursday because they felt threatened by Rocket’s growing presence on the brokerage channel. According to Austin Niemiec, executive vice president of Rocket’s wholesale brokerage platform, Rocket Pro TPO, Austin Niemiec says it now has about 10,000 brokers to work with, up from 3,000 three years ago.
“The reason we did this is because we give the brokers value,” said Niemiec in an interview with Crain. “Not by threatening them. Not by giving them ultimatums. Not by telling them what to do.
Niemiec implied Ishbia’s request to brokers to make a choice that someone went to FedEx and the logistics company and said they wouldn’t ship the package because that customer also uses UPS.
In an interview with Crain’s on Thursday evening, Ishbia stressed that he has not accused either company of illegal activity, adding that he is neither a “judge (or) jury” when it comes to violations of the Real Estate Settlement Procedures Act. Federal law aims to ban kickbacks and other abusive practices in the real estate industry.
However, Ishbia argued that both companies exhibited “sneaky” behavior, which led to his announcement.
“Fairway and Rocket are both doing insidiously to violate the lifeblood of the mortgage channel,” Ishbia said, adding that he believes the wholesale market is the better and cheaper option for consumers. “What (Rocket and Fairway) are trying to get rid of the mortgage brokers by doing what I think are sneaky.”
The UWM chief also noted that more than 90 percent of the responses he has received so far from brokers who have worked with all three companies intend to stick with Ishbia’s company only.