Mortgage bankers have had a rough year as origination volumes have collapsed in the face of the Federal Reserve's tightening of monetary policy to combat inflation. We have seen some big names exit business lines, and there have been a few bankruptcies. Capacity continues to get squeezed out of the system. Rocket (NYSE: RKT) is known primarily as a mortgage originator, but it is building a presence in other financial services, which will help compensate for the cyclicality of the mortgage business. 

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Rocket is known best for its app, which allows potential borrowers to handle most of the process from their phones. This app is more than a convenience, however; it is a core part of the company's cost advantage. Most mortgage originators employ loan officers who develop relationships with real estate agents, find borrowers, and shepherd them through the process. Loan officers are generally paid anywhere from 0.5% to 2% of the loan amount as a commission. Rocket doesn't need loan officers (the app handles that), which is a big cost savings. 

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Source Fool.com