Wholesale
partnerships

Last
week’s
earnings
painted
an
interesting
picture
for
the
company.
While
profits
shrank,
PennyMac’s

servicing
portfolio
simultaneously
grew
to
$680.2
billion
in
unpaid
principal
balance
(UPB),
up
2%
from
the
end
of
2024
and
10%
higher
compared
to
March
2024.

The
number
of

mortgage
brokers
approved
to
do
business
with
PennyMac
at
the
end
of
last
year
topped
4,850
—
an
uptick
of
19%
from
the
end
of
2023,
the
company
shared.

The
company
is
deploying
an
“aggressive”
growth
strategy,
Nichols
said.

“We’re
hiring
forward
to
build
scale,
both
in
operations
and
sales.
We’ve
got
some
tech
projects
underway
that
will
create
additional
efficiencies
to
provide
that
scale,”
she
said.
“So
aside
from
hiring
and
building
our
sales
team,
we’re
focusing
on
deepening
our
partnerships
and
developing
repeat
working
with
PennyMac.

“It’s
interesting
when
we’ve
talked
to
partners
that
have
worked
with
the
same
lender
over
and
over
again,”
Nichols
added.
“It
takes
a
while
to
kind
of
get
the
rhythm
with
PennyMac,
but
we’re
seeing
more
and
more
of
our
partners
are
recognizing
that
[they]
need
to
diversify
their
lender
partnerships.
…
We
think
bringing
additional
competition
into
this
channel
right
now
is
welcomed
by
the
TPO/broker
community.”

Nichols
also
touted
Pennymac’s
value
proposition
at
a
time
when
large
wholesalers
are
competing
for
customer
attention.

“There’s
a
lot
of
talk
about
choice
in
the
channel.
And,
you
know,
we’re
here,
right?
We
want
to
be
part
of
that
conversation,”
she
said.
“We
have
the
scale,
capital,

technology,
and
we’ve
invested
forward.
We’re
continuing
to
invest
forward
in
this
channel,
[are]
looking
to
raise
our
profile,
and
then
obviously,
by
doing
that,
increase
our
share
in
the
channel.

“We’ve
emerged
very
strong
in

jumbo
and
in
the
TPO
channel
as
a
very
strong
source
for
our
brokers
…
the
price
is
very
competitive,”
Nichols
added.
“They’ve
been
able
to
compete
with
banks
and
credit
unions,
and
so
that’s
been
a
big
win
for
us.
We’ve
also
been
seeing
ramp
production
and

closed-end
seconds,
home
equity
loans,
and
we
think
that’s
a
great
untapped
opportunity
for
the
channel.”

Market
share
aspirations

Several
brokers
who
work
with
PennyMac
candidly
shared
their
experiences
and
observations
of
working
with
a
company
competing
with
two
big
fish
—


Rocket
Mortgage
and


United
Wholesale
Mortgage
(UWM).

“[PennyMac]
is
well-rounded.
They
cover
many
areas,
they
follow
up,
and
they
take
good
care
of
us
and
always
have
pricing
incentives
for
us,”
said
Thuan
Nguyen,
the
founder
and
CEO
of
California-based


Loan
Factory.

Nguyen,
who
said
he’s
worked
with
PennyMac
for
more
than
seven
years,
admitted
that
he
could
see
PennyMac’s
quest
to
double
its
market
share
by
2026
being
a
difficult
task.

“It’s
going
to
be
tough
for
them
because
that
is
a
big
job.
All
lenders
are
hungry
right
now,
and
[all
lenders]
are
at
a
disadvantage
compared
to
the
other
lenders,
like
Rocket
and
UWM,”
he
said.

“It’s
a
very
ambitious
goal.
PennyMac’s
not
necessarily
at
a
disadvantage
—
they’re
doing
well
—
but
it’s
just
that
to
grow
more
than
100%
and
capture
10%
of
the
market
share
is
not
an
easy
task.”

Kevin
Leibowitz,
the
founder
of
New
York-based

Grayton
Mortgage,
said
that
PennyMac’s
history
could
spell
promise
for
its
market
share
ambitions.
Leibowitz
previously
worked
alongside
Spector
at

Countrywide
Financial.

“I
think
what
makes
Pennymac
interesting
is
their
DNA,”
he
said.
“They’ve
been
around
the
block
in
a
good
way,
right?
They’ve
seen
many
markets
—
good,
bad
and
ugly.
A
lot
of
the
guys
there
are
survivors
of
the
financial
crisis.”

Leibowitz
pointed
out
that
PennyMac
has
a
unique
advantage
“against
the
backdrop
of
the

Rocket/Mr.
Cooper
deal”
that
could
help
to
increase
its
market
share.

“Pennymac
always
keeps
their
servicing,
and
they
have
the
ability
if
they
want
to
help
the
broker
channel
[because
of]
the
fact
that
they
own
their
servicing
and
they’ve
never
sold
their
servicing.
They
could
better
service
that
market
than
the
companies
that
have
sold
their
servicing,”
Leibowitz
said.

“I
think
they’re
going
to
keep
more
of
their
servicing,
which
is
what
they
want,
because
that’s
a
multibillion-dollar
asset.
Will
they
make
money
on
the

refinance?
Yes.
Would
they
make
less
money
on
the
refinance?
Yes.
Could
it
be
mutually
beneficial
between
the
brokers
and
them?
Yes,
and
again
I
think
the
fact
that
they’re
keeping
the
servicing
is
going
to
give
a
competitive
advantage.”

Brendan
McKay,
the
owner
of
Maryland-based

McKay
Mortgage,
agreed
with
Leibowitz.
He
added
that
he’s
not
surprised
at
PennyMac’s
growth
during
the
first
quarter
of
2025.

“They’re
always
making
[and]
tweaking
improvements
and
listening
to
brokers.
So
I
think
it’s
no
shocker
that
they’re
growing
as
more
brokers
are
coming
into
the
channel.
…
When
brokers
start
shopping
for
price,
PennyMac
is
an
awesome
option,”
McKay
said.

“Plus,
the
fact
that
PennyMac
is
one
of
the
biggest
servicers
in
the
country
and
retains
the
servicing
is
insanely
important;
it
gives
them
stability
as
a
company,
which
is
great,”
he
added.
“We
like
stability
in
general,
but
also
it
gives
a
level
of
control
when
interest
rates
do
drop,
and
there’s
going
to
be
refinances
available,
having
a
deep
partnership
with
the
lender
that’s
also
servicing
all
of
those
loans
can
be
incredibly
valuable
and
profitable
for
the
brokers.”

McKay
said
that
PennyMac’s
market
share
goal
is
an
“aggressive”
one
but
is
“extremely
achievable.”

“They
also
are
one
of
the
few
wholesale
lenders
that
have
the
products
to
help
brokers
compete
in
the
jumbo
market
…
where
brokers
often
struggle
to
compete
on
price,
retail
does
as
well,”
McKay
said.

“They’re
one
of
the
most
powerful
lenders
in
our
industry,
and
that
servicing
portfolio
gives
them
unbelievable
amounts
of
potential
to
do
really,
really
big
things.”