The lawsuit, filed on April 3rd, claims that brokers were incentivized to direct most of their business to UWM, despite marketing themselves as independent brokers seeking the best rate and terms for their clients.

According to our experience with UWM, initially, perks often took the form of pricing incentives for clients. However, over time, UWM’s offerings became increasingly expensive to comparable mortgages available elsewhere for our clients. Despite this, reportedly many brokers continued to funnel a significant portion—up to 99%—of their loans to UWM according to independent investigations while maintaining the facade of independent choice.

Long before this legal action, Ritter Mortgage voiced concerns over UWM’s business practices. When UWM issued their ‘ultimatum’ to choose between them or Rocket, initially Ritter opted for Rocket Mortgage. Broker best practices though are to play lenders against each other to secure the best deals for clients, which guided Ritter’s decision-making process later in 2022 to switched to UWM.

However, as time progressed, UWM began retracting their promises, and their pricing drifted further away from the favored pricing initially offered due to Ritter sending insufficient percentage of our volume to ‘earn’ incentives. So, despite some initial success with UWM, Ritter Mortgage, already questioning their business practices, also increasingly found their pricing uncompetitive, prompting a return to Rocket Mortgage and termination of their agreement with UWM last autumn.