Can Rocket's Other Businesses Help It Overcome a Slowing Mortgage Market?
The past year was a great one for mortgage lenders. The Federal Reserve cut interest rates to historically low levels, and mortgage rates dropped to record lows as a result. Those rates prompted people to refinance at a record pace, and Rocket Cos. (NYSE: RKT) was masterful in leading the way.
According to the Consumer Financial Protection Bureau, Rocket Mortgage was No. 1 in the country in mortgage originations last year, with 1.1 million. Of those, 87% were refinance loans, totaling $274 billion in volume. These staggering numbers outpaced second-place competitor UWM Holdings, which issued 560,000 loans.
Rocket's solid performance continued in the first quarter, but the lender has noted that the mortgage market has begun to slow down. This is to be expected as the economy normalizes and rates begin to rise once again. Rocket understands the cyclicality of the mortgage market, and it has made strides to expand its other sources of revenue. Is it enough?
Source Fool.com
