Mat Ishbia: Yes. Thanks for the question. So I think it’s got to make sense for consumers. And I think it’s got to be – it depends on where they did their last loans. So usually, it ties to, can you save the consumer a 0.5 point in rate is usually how you think about it. And so borrowers that in October of this past year that were doing rates at 7.75, right, and then rates dropped. So we’re doing a 6.75, it goes – different borrowers will have different times they’ll refinance. But generally speaking, when rates get to 5.75 to 6.25, you’re going to see a lot of refi activity because it’s been a couple of years now when people have been doing loans at 6.5, 7, 7.5, maybe that’s why our MSR book – we’ve been doing – we’re doing the most loans for everyone.
So I know where the loans are being done. They’re being done at 6.5, 7, 7.5. So when rates get to 6.25, I’d call it 5.99, I think that will create enough of a benefit for a consumer to refinance. But beyond that, Steve, is the number one purchase lender, you’re going to see when rates get to 5.99, [indiscernible] on those purchases will start to pick up even more, too. And so we think purchase will open up, inventory will open up and rates will drop refis. I think it’s going to be a very, very positive environment. Whether it happens tomorrow or in 3 months or 6 months or 9 months, it’s going to happen, we just don’t know when. And that also will then dictate margins will go up, which is why I guided off the bottom.
Steve Delaney: Yes, that’s great color about – I hadn’t thought about the purchase, the purchase benefit in addition because that’s a lot of people are going to qualify now that may not have. So when this – when the shift comes and it comes, will UWM continue to work back to borrowers through your brokers? You seem to be resolute on that, that you work with the broker to get to the customer as opposed to creating your own call center like so many have tried to do over the years to capture the borrower? Thanks.
Mat Ishbia: Yes. 100%, we’re going to go through our brokers. It’s the right thing to do. It’s inappropriate what some of my competitors do and how they attack the brokers business. It’s just they’re downright wrong, and they run poor companies, sorry to tell you that. It’s just not the right thing to do. And so to attack your client, your client send you a loan and you refinance that client, it’s just the wrong thing to do. And obviously, we know Rocket and some of these other guys have done that for years, and they’re just doing the wrong thing to brokers, and that’s why the brokers know that. But we will never – and you can mark my words, never do that. We always give them back to the broker. We’ll help the brokers.
We’ll show them how to refinance. We’ll do trainings. We’ll coach them. We’ll show them which clients like how to call and how to sell it. We do all the things, but it’s the broker’s client, not ours, and that’s the right way to run a business. And that’s why we’ve been so dominant in the broker channel and this industry for years.
Steve Delaney: Thanks for the comments, Mat.
Mat Ishbia: Thank you.
Operator: Your next question comes from the line of Doug Harter with UBS. Please go ahead.
Doug Harter: Thanks. Mat, I’m hoping as you’re seeing gain margins come off the lows, how to think about what are the different types of environments that would cause you to kind of be low, middle, high end of your new range?
Mat Ishbia: Yes. So the 75 to 100, I think I said probably I don’t know how many quarters I guided towards it, but probably five, six, seven quarters is my guess, I don’t remember exactly. But the reality is, in the toughest mortgage market, UWM will – we are kind of the bellwether for what happens in the margins and how the business goes. And we’ve said, hey, 75 to 100, where it’s going to be. Now as the market starts to get better, I’m basically calling bottom. It’s not going to get worse than it was. We’re going to move it to 80 to 105. And then whether it stay like that for a couple of quarters or maybe I go to 85 to 110. And maybe I guess it’s going to continue to go eventually gets back to more normalized numbers when it’s a refi environment or a more normalized market.
Right now, we’re not there. But what I’m trying to signal to you and everybody else is it’s on the way. It’s on the way. We’re off the 75 to 100. It will be 80 to 105. Will I go to 85 to 110 next quarter? I don’t know. Maybe I go 80 to 105 for the next couple of quarters or maybe I’d go to 90 to 115, like it’s on the way up. It’s not going back. And you see we’ve been consistently at the middle to high range of the margin – of the range. And now I can move the range up, and I expect that, that will continue to move the range up, whether it’s next quarter or the quarter after or sometime in the near future.
Doug Harter: Appreciate that, Mat. And then as you’re thinking about the landscape as kind of all the realtor lawsuits and changes going on there, I guess, how do you think that impacts – or does that impact the broker and what challenges or opportunities does that create?
Mat Ishbia: Usually, real estate agents and brokers are really tied at hip. So mortgage brokers and real estate agents do a lot of the same things. They’re great for consumers. They’re on the ground talking to people. So obviously, when impacts happen to comp or potentially happen, they haven’t happened in the – I don’t know if they will for years, to be honest with you. But when impacts potentially happen, that creates opportunity for the best real estate agents, the best brokers to take advantage of it and create a new opportunity to grow their business. Just like years ago, all comp changed in the mortgage market, brokers were supposedly going to lose comp and all this stuff happens, and brokers actually thrived because of it.
